Something is deeply disturbing about a government which steam-rollers controversial changes to higher education funding through yet shows no inclination to reform regulations which allow British companies to avoid millions in tax.
It is easy to see why the student protests are spilling over into demonstrations against companies such as Topshop, Vodafone, Boots and now Cadbury because of claims they avoid paying their share of tax.
Yet, the strategies used by these big companies to reduce their tax are perfectly legal. There are two main methods: in the case of Topshop's Sir Philip Green, his retail chain is not actually owned by him but controlled by his wife, Cristina, who is a resident of Monaco, a tax haven. Green pays some corporation tax in the UK but he doesn't pay tax on the enormous dividends he and his wife earn because they are paid via offshore companies.
It's a different scenario for companies such as Boots, now privately owned with a registered head office in Zug, Switzerland. Even though most of its business is based in the UK, it pays only a fraction of the tax it would if it were still listed here. Kraft is also turning Cadbury into a new subsidiary of its Swiss holding company; last year, Cadbury paid £200m to the Chancellor. They are not alone; over the past few years list of self-exilers has been long; WPP to Dublin, Brit Insurance to Amsterdam and Wolseley to Switzerland.
Who can blame them? They follow the money, saving tax for themselves and their shareholders; they can pay between 8 and 15 per cent in Switzerland and 28 per cent here. Let's be honest, most individuals would do so if they could. Successive governments are to blame for allowing such a complex system to develop, particularly during Gordon Brown's last term which saw tax rules more than double in number. Experts warn the system could implode under the weight of its complexity.
Companies need predictable tax regimes as well as attractive rates. If Switzerland offers the low rates, as well as stability, you can see why companies are racing to the Alps while others are contemplating Hong Kong and Singapore; just wait till Barclays announces a move to New York or Standard & Chartered to the East; that will set the hares running.
In the meantime, the Government should do what it can to make our tax regime as attractive as possible, but without alienating the public or showing bias towards the privileged corporate world. So long as companies can escape paying tax, they will. And so long as countries can see a competitive advantage in offering a more attractive regime than another, they will.
The onus is on the Government to introduce fairness. It should order a review of the tax system, stop all tax alterations, halt all tax credits and investigate a much flatter system for both personal and business tax – the tax take would probably increase. It should also stop allowing companies to set interest payments on debt against tax; another big loophole for corporates that is not allowed to the individual.
On coming to office, David Cameron claimed this government would be one of "freedom, fairness and responsibility – we're in this mess together." It's time to show he means business or the protests may turn really nasty.
Indian Summer: Retiring CBI boss floated as Britain's man in Delhi
The hotline from Dehli is burning with the latest news that Richard Lambert, the retiring director-general of the CBI, is about to be made High Commissioner to India – the title applies to ambassadors between Commonwealth countries. Apparently, the choice of Lambert for this top spot comes directly from David Cameron, who recently led an enormous delegation to India to boost Britain's trade relations with Lambert at his side. Cameron believes Lambert is the perfect man to further improve relations with the country that has now become Britain's second biggest inward investor after the US. There's a nice symmetry to the appointment, too – it was Lambert who opened the CBI's first office in Dehli two years ago because he foresaw how strongly India's industrial revolution was taking off.
A word in your ear, says the man from the racecourse, about a 'stonking good' bet
My man from the races called with a hot tip on Friday – time to buy Betfair's shares, he says, a "stonking buy".
At first I thought I'd misheard him as not only is my broker friend one of the most cautious investors I know, but someone who detests the dizzy hype surrounding floats, usually equating the amount of dizziness to how much the stock is overvalued. Indeed, just having Goldman Sachs and Morgan Stanley on side to do the marketing would normally be enough for him not to touch the shares with a barge pole.
But Betfair has been unfairly hammered, he says, and shouldn't be confused with other recent floats such as Ocado or Promethean. The collapse in its shares to £9 came after its chief executive, David Yu, said profit hadn't grown as fast as expected, blaming both the weather and the delay on a new poker platform and the one-off float costs. Yu's warning was certainly not what you expect from maiden results after a float and he will need to be more careful about handling expectations.
So is my racing man right? He likes Betfair because of its top technology, which offers punters transparency when they place bets because it works like a stock exchange. Being a first mover will give it the edge for some time to come. But the big shadow hanging over Betfair – and one that was highlighted in the prospectus – is that it needs both regulatory clearance and a benign tax regime in its overseas markets. At present, it's got that only in the UK and Ireland, but if it gets clearance in the world's biggest markets, then it could be worth a fortune.
Until that's sorted, I'm not sure it's worth taking a punt. However, that didn't stop Betfair's finance director, Stephen Morana – who made a £582,000 profit from the float – from reinvesting around £10,000 when he bought 1,000 more shares on Thursday at just over £10 each. Is there something he should be telling us?