Wednesday, 18 March 2009

The sharp end

The Barclays tax evasion scandal is certainly at the sharp end of the battle between investigative journalism and corporate cover-up, as today's Guardian shows.

The Lib Dems are very much on the case and other MPs are very critical of Barclays tactics:
Paul Farrelly, MP for Newcastle-under-Lyme, said: "It is worrying that Barclays should resort to the courts like this to suppress genuine, investigative journalism. Now more than ever the public interest demands that a free press should investigate tax avoidance, especially where it occurs on a grand scale ..."

"The Guardian should be allowed to publish in the public interest and if Barclays wishes to contest the accuracy, it can always sue after the fact."

Richard Shepherd, Conservative MP for Aldridge-Brownhills, said: " It in the public interest that the Guardian wins. The gag should be lifted."

In arguments to the high court yesterday, Alan Rusbridger, the editor-in-chief of the Guardian, said: "I considered these documents to be of the highest significance in the debate about tax avoidance. They revealed at first hand the processes involved in structuring extremely complex and artificial tax avoidance vehicles; how lawyers and accountants worked together to exploit loopholes in government legislation; and the degree to which they are sanctioned at the highest levels within Barclays."

I'm calling this tax evasion rather than tax avoidance. Strictly speaking one is illegal, the other legal. But tax evasion is the only phrase that adequately describes using an army of lawyers and accountants to create artificial vehicles that are so complex that no-one can work out whether they are legal or not.

If Barclays has nothing to hide, why the need for the injunction?

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