SSE, the orangutan…and ‘tax-wash’
The latest SSE ad raises the ghastly prospect of brand owners turning to advertising to project their whiter-than-white tax credentials, just as they have with green issues.
Readers of this column will know that I have a strong view about Scottish and Southern Electric (SSE) and its orangutan ad.
Now they’ve gone and annoyed me again. This time, SSE is using our furry friend to claim it is a decent corporate citizen and pays its taxes as it should.
You can see it here in this endframe, as well as in various press ads. “Proud to be the first FTSE 100 company accredited with the Fair Tax Mark,” SSE claims, without offering any explanation of what this actually means, or what the Fair Tax mark is.
Hmm, you wonder, says who?
It has not exactly covered itself in glory of late, but the implication is that this little Fair Tax badge is like a gold star handed out by HMRC.
After all, when it comes to paying fair tax, its view is really the only one that counts.
On closer investigation, however, it turns out that the Fair Tax mark has no official status whatsoever. No, the Fair Tax mark belongs to an organisation called the Fair Tax Campaign, a self-appointed, soi-disant arbiter of whether companies pay their tax as they should.
And while the Fair Tax Campaign is a not-for-profit organisation, the Fair Trade mark is actually a business.
Yes, companies can apply to the Fair Tax Campaign, pay a fee to have their taxes looked at, and then pay a licence fee for the right to use the Fair Tax mark. You can see it in the Ts&Cs here. That fee is a percentage of turnover: in SSE’s case, it turned over £30bn in the year to end-March 2014.
Even a tiny percentage is a sizeable sum. And call me a cynic, but as with all these unofficial, unaudited certification bodies, you have to ask yourself: what incentive do they have to deny companies like SSE? Answer: not very much.
One answer might be reputation and credibility. But the Fair Tax Campaign has only been going a year or so, so it hasn’t got much to lose.
And nor is it as if it is really possible to challenge their methodology, since this appears to be pretty opaque.
Ah well, you think, maybe they have a formidable team of forensic tax accountants trained, let us imagine, by HSBC Switzerland but acting as poachers-turned-gamekeepers.
Er no. It has a team of seven technical advisors, only four of whom are accountants or tax specialists. Put them up against the tax department of a £30bn company, plus its tax accountants and lawyers and, well, it’s like sending out a team of under-11s to play West Germany.
Besides, it seems to me, it is impossible to define ‘fair’ in tax terms. One man’s fairness is another’s outrageous avoidance. What is the difference between ‘legal’ and ‘fair’?
As Chas Roy-Chowdury, head of taxation at the Association of Chartered Certified Accountants, says: “Even tax experts wouldn’t necessarily agree with each other.”
All this raises the ghastly prospect of brand owners turning to advertising to project their whiter-than-white tax credentials, just as they have with green issues, sustainability and corporate citizenship.
We’ve had ‘green-wash’. Now it’s ‘tax-wash’.
And when it is melded into an advertising campaign, the implication is obvious: that SSE, or whoever, is trying to gain a competitive advantage over its peers.
From that, it can surely be only a short step to advertisers slugging it out at the Advertising Standards Authority, with each trying to belittle the other’s claims. But how on earth is the ASA supposed to decide?*
The trouble is that it doesn’t do the advertising industry any good to be seen to be a part of, or to be complicit in, this kind of chicanery. Except that it can’t really help it if it is what clients insist on.
*Let’s see what the ASA decides. I have made a complaint (first time for me) and I’ll update you on its progress.
P.S. In case anybody wonders if I am an SSE customer taking my revenge, I’m not. I used to be a customer but I changed when I moved house. And my experiences with SSE were perfectly OK.