A Cheeky Welsh Town Goes 'Offshore' To Avoid British Taxes : Parallels Frustrated with large multinational corporations that escape British taxes, the town of Crickhowell has decided to make a point by doing exactly the same thing.
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A Cheeky Welsh Town Goes 'Offshore' To Avoid British Taxes

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A Cheeky Welsh Town Goes 'Offshore' To Avoid British Taxes

A Cheeky Welsh Town Goes 'Offshore' To Avoid British Taxes

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ROBERT SIEGEL, HOST:

In the United Kingdom these days, tax avoidance is a big issue, especially when a large multinational company goes offshore by using creative accounting methods to reduce or avoid paying U.K. taxes on its profits. In a small town in Wales, local businesswomen and men have decided to try the same thing to make a point. NPR's Peter Kenyon takes us now to the town that went offshore.

PETER KENYON, BYLINE: The town is called Crickhowell, and it's nestled in a Welsh valley surrounded by rugged mountains with a river tumbling passed the remains of a fort dating from the Iron Age. Crickhowell is the hub for surrounding villages. It does a fair tourist trade given its picturesque setting inside a national park. But these days, it's also known for something else - local activism against big companies like Starbucks, Facebook and Google that pay little or no taxes in the U.K. It's not hard for a big corporation to declare it's headquarters in another lower-taxed country. Lots of folks complain about that kind of tax avoidance. But people here decided to do something about it.

MICHAEL CASHEL: My name is Michael Cashel. I've been here 40 years.

KENYON: Cashel runs a local butcher shop right next door to a pub that recently closed. Cashel says when a chain-store proposed to move in, hundreds of people turned out not just to protest but to work out a plan for buying the property themselves to keep the town local. Crickhowell is gaining a reputation as the town that defends its independent businesses. Cashel says there's just one chain here, a pharmacy called Boots, owned by the U.S. giant Walgreen's.

CASHEL: Very rare - very rare, yes. Boots, yes, don't talk about Boots. (Laughter) They - they're so mean, they wouldn't put a Christmas tree up last year.

KENYON: Across the street, at the Number 18 coffee shop, proprietor Samantha Devoss says she and a few other businesses have put forward a plan that mimics some of the tactics used by multinationals to avoid paying taxes in the U.K. The point she says is not to deplete the British treasury even further but to force the government to crack down on big tax avoiders such as Facebook, which Devoss says paid less in taxes last year that her waitress.

SAMANTHA DEVOSS: We're really angry. And it's totally unfair because we pay all of our tax so we're - we're revolting in Crickhowell.

KENYON: (Laughter)Yes, well we won't touch that one but - so you don't really want to pay your taxes to some other offshore entity?

DEVOSS: No, we don't really. We want to pay our taxes, and we want to have our taxes to stay in the U.K. Small businesses are the backbone of the country and the Exchequer relies on us to pay our taxes. And if we weren't to pay our taxes, I believe he would have to close the loopholes that the big companies have.

(SOUNDBITE OF MUSIC)

KENYON: Rebelling against central authority is something of a British tradition. Fan's of the old British comedies may recall "Passport To Pimlico" in which a London neighborhood finds a document that seems to say it's legally a part of France.

(SOUNDBITE OF FILM, "PASSPORT TO PIMLICO")

UNIDENTIFIED ACTOR: (As character) A British passport for Pimlico - there must be some mistake.

KENYON: What's happening in Crickhowell is less dramatic than that. But the town could be risking penalties from her Majesty's revenue and customs office if its tax plan isn't accepted.

ANN JEREMIAH: You want - do want milk - yes?

UNIDENTIFIED MAN: Yes, please.

JEREMIAH: Sugar?

UNIDENTIFIED MAN: Actually, that would be great.

KENYON: As the mayor, Ann Jeremiah, serves coffee to visitors, she says it's a constant struggle. No sooner had they launched their fundraiser to promote the closed pub from turning into a chain-store than a bank announced its closing, the one with the town's only ATM. On top of that, she says, budget cuts are getting worse.

JEREMIAH: One of which was the toilets. They were going to close the toilets in Crickhowell, which is taking us back to pre-Victorian days. So the town council have had to find the money to keep those toilets open. We're now facing library closures.

KENYON: If nothing else, the town is now getting more attention than it has a long time. The BBC plans to air a documentary on the so-called town that went offshore next year. Peter Kenyon, NPR News, Crickhowell, Wales.

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