Tax shockers ramp up India investor risk premium

April 17, 2015

The country wants $6.4 billion in what it says are unpaid taxes from foreign funds. Private equity firms could be the next target. The frequent adjustments to tax policy raise a red flag. Investors will have to demand higher returns to insure against future fickleness.

India’s “tax terrorism” proves hard habit to kick

March 13, 2015

The government could honour a campaign pledge to make taxation more certain by scrapping a rule that allows it to seek payment for past transactions. That is politically fraught but may be less damaging than pursuing the likes of Britain’s Cairn Energy for old deals.

HSBC’s operating woes trump Swiss tax furore

February 23, 2015

CEO Stuart Gulliver’s offshore accounts bring new scrutiny of past fiscal fiddles. They also raise the bar for future good behaviour. The main concern for investors, though, is the bank’s lacklustre financial performance. Even a reduced 10 percent ROE target is some way off.

China’s offshore empires go from help to headache

November 25, 2014

Authorities have launched an assault on evasion, extracting $137 mln in taxes from a multinational company. Anonymous offshore havens and convoluted ownership chains make enforcement complex. Without them, innovative Chinese companies like Alibaba and Tencent might not exist.

Boris should pay up but not shut up over U.S. tax

November 24, 2014

The London mayor, an American citizen, objects to paying a U.S. capital gains levy on his UK residence. Uncle Sam’s ex-pat tax laws are worthy of reform. But if Johnson really cares about that, the way to show it is to clear his debt and then campaign for change.

How to make Japan’s tax timetable more credible

November 19, 2014

Prime Minister Shinzo Abe is seeking a fresh political mandate to delay next year’s planned increase in the sales tax by 18 months. But fragile demand means investors will be sceptical of the new schedule. A better strategy would be to link the tax hike to growth in real wages.

AbbVie U-turn shows Shire was mostly about tax

October 15, 2014

The American group has cooled on a $55 bln bid for its UK-listed peer. The change of heart was prompted by U.S. opposition to “inversions.” That shows how much, despite AbbVie’s earlier protests, this deal was driven by tax. A recut takeover looks unlikely.

Cameron takes deficit amnesia to a new level

October 1, 2014

The UK prime minister crowed when opposition leader Ed Miliband forgot the deficit in a keynote speech. Yet David Cameron has gone further, insisting on the need to tackle the country’s biggest problem and then pledging a tax giveaway. It’s an electoral bribe he can’t afford.

Behold the unversion: an inversion in all but name

August 8, 2014

U.S.-based data protection firm SafeNet may slash its tax rate as part of a cross-border deal. Instead of doing so by acquiring overseas, though, it is simply selling itself to Dutch digital security company Gemalto. It shows the limitations of a possible ban on inversions.

Walgreen encounters uncommon inversion boundary

August 6, 2014

The drugstore chain will keep flying the U.S. flag even after buying the rest of Swiss-based Alliance Boots for $15 bln. A backlash against corporate emigration may have affected Walgreen’s decision, but harder numbers probably mattered more. Expect more tax arbitrage deals.