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  • Konrad Werner: Legal tax-dodging is a lot worse


Konrad Werner: Legal tax-dodging is a lot worse

Everyone hates rich people, so why don't we hate rich companies?

Image for Konrad Werner: Legal tax-dodging is a lot worse
Bayern Munchen president Uli Hoeneß. Photo by Alexander Korchik (Wikimedia Commons)

I get jealous of rich people too. I can’t help it. I feel bitter and inadequate and bitter about my inadequacy when I read about people owning lots of money. Consequently I always cheer up when something bad happens to them. It makes me feel better still when the bad thing that happens to them illustrates how greedy they are, because then I have the added bonus of being able to imagine that this is the reason why they are so rich. I can tell myself that their wealth is just a sign of how sinful and weak they are. That feels so good.

Top football director Uli Hoeneß and top feminist Alice Schwarzer are both getting done for tax dodging at the moment. Hoeneß kept a lot of money in a secret bank account in Switzerland and is said to have made “well over €30 million” from the investments there without mentioning it to the German tax authorities, saving himself about €3.5 million in taxes. Schwarzer similarly made some money in Switzerland and recently admitted it and then reported herself and paid about €200,000 back. She probably won’t have to go to prison, but because €3.5 million is so much money, Hoeneß is looking at ten years in the clink. 

His case in particular seems to have done Germany’s state finances some good – when his case was splashed everywhere, about 25,000 panicky tax dodgers reported themselves. In fact, ever since 2010, when the first reports of stolen tax-data CDs from Switzerland came out, about 60,000 people have reported hiding their taxes and now the German government has got an extra €3.5 billion to spend on kindergartens and hospitals, or armed drones – whatever we need most.

But really, seeing that Germany’s tax income for 2014 is expected to be €640 billion, that’s just loose change that slipped under the fiscal sofa cushion. The real money gets lost in totally legal ways and no one ever gets arrested for it. Because it’s done by Apple and Amazon and Starbucks, rather than rich fat men who sell sausages or wrinkly feminists, it doesn’t poke a stick into the sore wound of my personal failings. I don’t find it so immoral and don’t get angry about how unfair life is.

Everyone knows the tricks that these big companies do – funnelling profits via subsidiary companies in Luxembourg where you just keep an office, or selling products to your own company at ridiculous mark-ups. Something like that. I don’t have a clue how it all works, but the tax workers’ union estimates that the state loses around €50-€60 billion a year this way. Of course individuals do all they can to avoid paying tax – but the way our system is set up, the bigger the company, the more tax it can avoid paying, because it’s in a better position to take advantage of national borders. But, I don’t know, I find it so hard to get worked up about it. I like iPhones and foamy coffee and getting books sent to my door in one click.

Then again, think of the brilliant kindergartens we could have for that extra money though. And the drones! We could make amazing drones for €50 billion. They’d be better than America’s drones and not rubbish like the one we made that didn’t even work properly. We could really blow things up and then rule the world.