Tuesday, May 03, 2016

Compass: Tax cheats

Surprise, surprise: it turns out that Compass, best known for endangering hospital staff by serving inedible slop to hospital patients, are tax cheats:

Compass New Zealand has lent its British-based parent millions of dollars while the fees and royalties it has paid to the UK have quadrupled over the last four years.

Tax experts have said such transactions are commonly used by multinationals to shift profits between subsidiaries to avoid paying tax.


Auckland tax consultant Terry Baucher described the loans as "unusual", especially given the interest rate of between 2.9 percent to 3.8 percent was a lot higher than what Compass would pay for borrowing money in the UK and none of the money had been repaid.

So Compass screws us at both ends: they take government money to deliver a service, then fail to deliver it to an acceptable standard. Meanwhile, they're using dodgy accounting tricks to avoid paying taxes on their profits (and telling the IRD something different from what they're telling their shareholders). Their contract should be cancelled, and they should be banned from further government business until the IRD has given them a clean bill of health. Our government should not be giving business to tax cheats!