By paying extra tax Starbucks is doing exactly the wrong thing

A "moral taxation" system would be deeply weird.

So Starbucks has caved to public pressure and opted to pay more tax. It doesn't have to - it has paid its legal dues - but is chosing to, as a moral gesture, in order to appease public anger. It is also trying to appease MPs, who have been keen to tap into this public anger by declaring tax avoidance "morally repugnant".

Good thought, but any "moral repugnance" is in the tax laws they themselves continue to approve. No actual changes in legislation have been planned. Instead the government has opted to pressure companies not staying within the "spirit of the law" in a £77m crackdown.

This is odd. When government spots something "immoral" going on that is not yet illegal, common practice is to change the law (rather than simply moralise). It's also common practice for companies make money by working out how they can cut costs while staying within the letter of the law.

If these practices are abandoned, a deeply strange system starts to emerge. Namely, a tax system which relies on public pressure to a few high profile firms. This looks unappetisingly vague and inconsistent to outsiders. As Alex Henderson from PWC told City AM:

"It is important that we have stability and simplicity in the tax regime if the UK is to attract foreign firms - if there is uncertainty in the system that is concerning."

Admittedly, there are a few places where simply urging people to keep to the "spirit of the law" works - places like China, where laws are occasionally kept vague (but with huge penalties) to scare people into behaving extra well. It may not work so well here.

Starbucks. Photograph: Getty Images

Martha Gill writes the weekly Irrational Animals column. You can follow her on Twitter here: @Martha_Gill.

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The economics of outrage: Why you haven't seen the end of Katie Hopkins

Her distasteful tweet may have cost her a job at LBC, but this isn't the last we've seen of Britain's biggest troll. 

Another atrocity, other surge of grief and fear, and there like clockwork was the UK’s biggest troll. Hours after the explosion at the Manchester Arena that killed 22 mostly young and female concert goers, Katie Hopkins weighed in with a very on-brand tweet calling for a “final solution” to the complex issue of terrorism.

She quickly deleted it, replacing the offending phrase with the words “true solution”, but did not tone down the essentially fascist message. Few thought it had been an innocent mistake on the part of someone unaware of the historical connotations of those two words.  And no matter how many urged their fellow web users not to give Hopkins the attention she craved, it still sparked angry tweets, condemnatory news articles and even reports to the police.

Hopkins has lost her presenting job at LBC radio, but she is yet to lose her column at Mail Online, and it’s quite likely she won’t.

Mail Online and its print counterpart The Daily Mail have regularly shown they are prepared to go down the deliberately divisive path Hopkins was signposting. But even if the site's managing editor Martin Clarke was secretly a liberal sandal-wearer, there are also very good economic reasons for Mail Online to stick with her. The extreme and outrageous is great at gaining attention, and attention is what makes money for Mail Online.

It is ironic that Hopkins’s career was initially helped by TV’s attempts to provide balance. Producers could rely on her to provide a counterweight to even the most committed and rational bleeding-heart liberal.

As Patrick Smith, a former media specialist who is currently a senior reporter at BuzzFeed News points out: “It’s very difficult for producers who are legally bound to be balanced, they will sometimes literally have lawyers in the room.”

“That in a way is why some people who are skirting very close or beyond the bounds of taste and decency get on air.”

But while TV may have made Hopkins, it is online where her extreme views perform best.  As digital publishers have learned, the best way to get the shares, clicks and page views that make them money is to provoke an emotional response. And there are few things as good at provoking an emotional response as extreme and outrageous political views.

And in many ways it doesn’t matter whether that response is negative or positive. Those who complain about what Hopkins says are also the ones who draw attention to it – many will read what she writes in order to know exactly why they should hate her.

Of course using outrageous views as a sales tactic is not confined to the web – The Daily Mail prints columns by Sarah Vine for a reason - but the risks of pushing the boundaries of taste and decency are greater in a linear, analogue world. Cancelling a newspaper subscription or changing radio station is a simpler and often longer-lasting act than pledging to never click on a tempting link on Twitter or Facebook. LBC may have had far more to lose from sticking with Hopkins than Mail Online does, and much less to gain. Someone prepared to say what Hopkins says will not be out of work for long. 

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