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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Friday, April 27, 2012

How Goldman Sachs Delays Tax Payment

Wherever there is a loophole, you will find Goldman Sachs.  This time it is a "timing difference" which, by the way, allows Goldman to keep its money and make more money from it before using it to pay taxes.  Apparently, Goldman is capable of paying the tax in full with cash on hand.

 Maybe Goldman should set aside a yearly sum for tax money just as it sets aside large sums for "legal" payments; that is, to pay fines for malfeasance.

Goldman Sachs pays £4.1m tax on £1.9bn profit
Wall Street giant attacked for deferring 99 percent of its tax bill
By Gideon Spanier - The Independent

The London arm of Goldman Sachs paid only £4.1m in corporation tax to the Treasury last year despite making pre-tax profits of £1.92bn, annual accounts have revealed.

Goldman Sachs International (GSI) had a corporation tax bill of £422.3m but it deferred £418.2m – or more than 99 per cent of the amount – that it had to pay immediately in "current tax". The Wall Street giant, presided over by Lloyd Blankfein, was able to postpone payment because of "timing differences", according to the accounts.

Goldman's decision will be a blow to the Treasury's coffers as the Chancellor George Osborne battles to reduce the Government's deficit. There is no suggestion that GSI is seeking to avoid corporation tax by deferring payment. However GSI's tax activities have come under scrutiny after it emerged last year that the Inland Revenue boss Dave Hartnett had "let off" the bank to the tune of £10m.

Mr Hartnett insisted to MPs that "a mistake had been made" and he is retiring early this summer.
The bank's UK corporation tax bill fluctuates yearly as it can be skewed by the value of its bankers' share options, which oscillate in tandem with the stock market.

The £4.1 m GSI has paid in "current" corporation tax in 2011 is in stark contrast to the £336m it paid in the previous financial year.

The accounts showed revenues slumped 31 per cent to £3.19 bn last year because of eurzone jitters and "lower global equity prices". But profits jumped, partly because the "paper" value of share options paid to staff fell by more than £1.1 bn, thus cutting the bank's wage bill.

Labour MP John Mann, a member of the Commons Treasury select committee, said Goldman Sachs should not defer tax payments when it could hand over the cash now.

"It's morally and ethically wrong. These are people who are at the heart of the problem in the financial world who've paid extraordinary bonuses to their partners and aren't prepared to pay a fair amount of tax. It's pure unadulterated greed."
Read the whole article here 


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