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Wednesday, 19 December 2018

Raab wants to throw UK taxpayers' money at Airbus and Renault

There's a half decent article in the Telegraph this morning by Dominic Raab (£) in which he sets out many sensible measures we should be taking in advance of a clean break with the EU in March. However, he ruins it with an ill-considered and ill-disguised suggestion of a massive bung from UK taxpayers to the global corporates, including Airbus, Renault, VW and Fiat;
Third, the Treasury must prepare a Brexit budget to identify businesses – including ‘just in time’ manufacturers – most at risk from a departure on WTO terms. We should cut business taxes to boost them as they transition, and offset the cost from the £39 billion the UK would have paid the EU.
It's disingenuous and mendacious.

First, the UK will not avoid having to make a very large payment to the EU. It may not be in 2019 with a clean break, and it may not be as much as £39bn, but even if we kick it over to the International Court in the Hague, I suspect we may have have to end up paying as much as half, say £20bn. 

Second, compensatory tax measures should be limited to UK owned and headquartered firms. We know Airbus, whose aircraft wings are made here, is not one. Nor should we compensate any EU firms with satellite plants in the UK - it has been the EU's bloody minded intransigence that has precipitated a clean break scenario. 

Raab's Telegraph piece appears to have been co-ordinated with the global corporates, who are this morning whining at full chat and demanding taxpayer cash to enable them to continue paying multi-million pound bonuses to their bosses, or they sack Welsh workers. 

My own view is that in the end we won't get a Clean Break Brexit. May's government is now orchestrating a full scale national panic - the end play of Project Hysteria - that will act to terrify the Commons into submission early in the new year. Some minor concession from Brussels and MPs, and the symbiotic Axis pact between government and the big corporates will continue - and bugger the people of Britain.


rapscallion said...

We owe them nothing. NOT ONE PENNY.

They've been taking money of us for 40 years under false pretences, and then what little we do give back, suddenly it because of the good ole EU.

And just who pray, is going to make us pay anything?

Stephen J said...

As you say Raedwald, if any companies are due tax reductions, it is the ones that do not conduct business overseas.

But since the real tax payer is the individual anyway, why not keep a keen eye on personal taxation, rather than worry about the businesses...

Perhaps something can be done about the EU tax... VA bloody T?

Regarding the clean break...

The government is being so bloody obvious about it, that with a bit of luck it won't fool anyone with anything more than a "room temperature IQ"... Hopefully there are enough MP's out there who will qualify on a good day.

DiscoveredJoys said...

I've not yet heard a convincing reason from Remain groups for staying in the EU. A surprising lack of evidence in the debate.

So I ask myself Cui Bono? Who benefits? Apart from the post Parliament jobs for politicians I suspect the group that derives the most benefit from EU membership are big businesses. Not only do the get to 'manage' their tax affairs to pay tax in the most favourable country in the EU, they are able to lobby the 'civil service' of 28 countries in one place, one set of people to influence. And they lobby in their own interests (naturally) with little risk of unexpected change and few smaller firms being able to compete.

So Raab proposing tax rebates is best explained not as natural justice, nor a pragmatic adjustment, but a bribe to soften the blow of economic privileges foregone.

I would prefer that the Government just got on with a clean Brexit, a Sovereign Brexit, and let any corporate adjustments flow naturally.

Budgie said...

Despite the threats by the corporates to exit the UK if we did not join the euro they are still here. Now they at it again with threats that unless we remain in the EU they will quit. Actually these corporates don't care about politics, they care about the money - they want the bungs to continue. If we were a little bit more robust as a sovereign nation - a little bit more nationalist, shall we say? - we could tell them to eff off. One of the many advantages of leaving the EU.

Budgie said...

Anyone who has read Theresa May's Draft Withdrawal Agreement can see that it is bad law badly written with the aim of keeping us tied to the EU.

Remaining in a customs union with the EU, aligned to the EU's single market, the entire UK (rather than just exported products) subject to EU rules, subject to the CJEU, sharing "fishing opportunities", in military unification with the EU, etc, etc, means that the DWA is quite definitely not Leave.

Thick MPs do indeed show every sign of being swayed by Project Hysteria. And as I have been saying for months the most likely outcome is that the majority Remain MPs in the HoC will vote for the DWA - the current version of Chequers. Mrs May will be propped up by Labour MPs, and we Leave voters will be stuffed.

John Brown said...

Raedwald, I agree with everything you say...except that I would be prepared to bribe the CBI and the corporates if it meant we could leave the EU completely with a "no deal" on WTO terms and no longer in the SM/CU/ECJ.

In the long run it would be worth it.

Domo said...

"First, the UK will not avoid having to make a very large payment to the EU. It may not be in 2019 with a clean break, and it may not be as much as £39bn, but even if we kick it over to the International Court in the Hague, I suspect we may have have to end up paying as much as half, say £20bn. "

I'd be interested to see the logic there,

Budgie said...

Domo, obviously I don't speak for Raedwald, but the way I see it is the UK committed to the EU's Multiannual Financial Framework (MFF) in 2014 for 7 years - expiry December 2020. Blame Cameron for that.

We are probably liable for two principal (MFF) amounts: our annual net cash gifts; and the authorised spending not yet incurred (RAL - reste a liquider). So we pay full annual subs up to 29 March 2019. Then we owe 1.75 years net subs and any RAL. The ICAEW indicates a total owed of about £44bn (£16bn + £28bn RAL) in its central scenario, less our rebates and what the EU owes us. The final c/s is a charge of about £15bn (scenario range is £5bn - £30bn).

That we have agreed provisionally to pay £39bn shows how useless our civil service negotiators are.

Raedwald said...

Much more scientific than my guesstimate Budgie - I bow to your knowledge

I based my figure on three things -

1. Estimates of legal liability range from a House of Lords opinion of zero to the government's last estimate of ACTUAL liability of £36bn
2. In fairness, we should really pay our share up to the end of the budget cycle in 2020 - say £10bn a year
3. My long experience of construction adjudications is that a claimant gets something just for putting their name at the top of the paper. I reckon the International Court would award £5bn minimum plus a year's subs (£10bn) plus some odds and sods - so say £20bn

Of course by kicking it over to the Hague and flooding the place with lawyers, judgement could be delayed by two to five years after we left - a punch in the balls to the EU, whatever the final figure.

DiscoveredJoys said...

The biggest question in my mind is which metaphor is appropriate for working out the size (if any) of the leaving payment.

If Brexit is a 'divorce' then we should perhaps meet our commitments but also receive a share of the assets.

If Brexit is 'leaving the club' then we have no claim over the assets but no liability for future subscriptions.

I expect that in reality the actual situation is somewhere in between - but since the 'trade agreement' has not been agreed yet I would withdraw the £39 bn offer until the trade agreement is resolved.

jack ketch said...

most likely outcome is that the majority Remain MPs in the HoC will vote for the DWA - -Budgie

I'm sure they will. Got to hand it to May, announcing that the army was standing ready to 'assist' would have had Goebbels smiling, confirming every Remainer's worst fears about a car crash Brexit. But to be fair, the 'leadership' of the parliamentary Leavers have already demonstrated time and time again that they have absolutely no spine, no personal values, no strength of character so I dare say quite a few of the more Brexity MPs will also fall into line.

Mr Ecks said...

NOBODY believes ANY of the Project Fear cockrot. NOBODY.

Scum Tory MPs think they can use it as a excuseOh I just couldn't expose the people to all those horrors". Utter bullshit.

Get ready for trouble.

Dave_G said...

Project fear is project collusion.

I have no doubt in my mind whatsoever that problems will be MANUFACTURED to 'prove' the issues over a WTO exit. We need to look for these fake events and expose them.

As ever we are betrayed by a corrupt media working against everything democratic. I don't know who to loath mosst - politicians or the media.

But if we analyse the situation then if the media were truly honest and did their job then the politicians wouldn't be able to do what they do.

jack ketch said...

We need to look for these fake events and expose them Dave G

I find the problem is that the very real dangers of a car crash brexit are either under reported OR over reported; underplayed or overplayed, either by the media,by the politicians and by 'activists'. A balanced view is hard to find but personally my Go-To for sensible explanations/analysis on anything Brexity is Ed Spalton, who has usually written a medium size volume on almost any aspect of Brexit one might care to mention. And yes I am aware that Ed is a committed (committable?) Leaver, but I don't hold that against him.

Budgie said...

Jack Ketch, Remains have never explained why the UK is intrinsically incapable of being as independent as New Zealand, or any other nation similar to the UK.

The nearest they've ever got to addressing the fundamental flaw in their position is to sneer that we will become like Albania, or N.Korea, something that given our geography, law, democracy and culture is near impossible.

You blustered that our politicians were incapable, going for the easy laugh. That doesn't stand up to 5 minutes scrutiny either. And politicians are replaceable anyway.

Of course there will be problems to sort out when we change from one system (the EU) to another (independence). But those problems are surmountable for the obvious reason that nations such as NZ have already surmounted them.