Mistakes such as these should disqualify the wealthy from pontificating about taxation or redistribution.

That is, of course a quote from Polly's new book. If we replace "weatlhy" (which Polly is of course but no matter) with "journalists" we have a handy stick with which to beat those who don't understand what is goin on around them but insist nevertheless to pontificate upon such matters. Like, umm, Polly:

(Incidentally, the US has a hefty exit tax, punishing companies that leave: why not here?)

That would be because we're members of the European Union dear. You know, this free movement of goods, labour and capital? It applies just as much to companies as it does to individuals: the freedom, the right, to change domicile as one wishes.

It's true that we used to have a hefty exit tax (roughly speaking, the company had to dissolve and reform, requiring the crystallisation of all of the decades worth of unrealised profits, a very expensive tax manouvre), but our membership of the EU has put paid to that.

Something old of mine on the subject here but while the name of the Directive underlying this might have changed the basic concept is inherent in our membership.

It's a basic requirement of case law from the European Court that companies, being legal persons, should be treated in the same way as natural persons and there has been a preliminary judgment from the Court that companies should be able to move in the same way as individuals. We'll all have to wait another year or so to see whether the full Court upholds that judgment but in the interim we have EC 2157/2001 which comes into effect on 8 October this year (2005-Tim).

You want to change that then we have to leave the EU, simple as that. I'm all in favour of leaving, of course, although not for this reason, but I have a feeling that Polly might think the cost of preventing companies from leaving to be a little high.

But the much more important point is this: mistakes such as these should disqualify the journalist from pontificating about taxation, no?

Update: I've just had an email back from Polly thanking me for pointing this out to her. Rather spoils the fun when such ranting is met with a polite response. Sigh.

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