After months of Hullabaloo over the US elections, they finally have sworn in Joe Biden as the 46th President of the USA. And Kamala Harris made history as the First Indian American Vice President.
🕺 The Intriguing Waiver of MJ’s Concert
📅 1996. A 35,000, fully sold-out, 17-song Michael Jackson concert created an immense uproar in India. Bombay was one of the destinations in MJ’s 83-show History World Tour and he came in with a Bang. The governing party – right-wing Shiv Sena waived off entertainment tax on the show on the grounds that it was a ‘classical performance and the earnings were meant for a philanthropic and charitable purpose.’ And the tickets went as high as INR 5,000 ($68/£50) which was not cheap for the time.
😵 The Chaos. Right before the concert, the authorities had increased sales tax on medicines. A Consumer Protection Group aka Mumbai Grahak Panchayat could resist but shout it loud…how making a music concert attended by affluent people ‘tax-free’ and ‘raising taxes’ on medicines for the ordinary was impeccable. Shiv Sena faced the music when a legal battle began. The participants? Government, a concert organizer (Wizcraft Entertainment), and a consumer protection group.
🤔 Intriguing. Was the performance eligible for a tax waiver? Also, MJ had “for reasons known to only a few, waived his performance fee.” He had promised to donate profits from the concert – which eventually ran to more than $1M – to a Shiv Sena-run youth employment project. With this turning into a fundraising event, this waiver would benefit the private event management company and the ruling party-backed youth employment project.
⚖️ The Action Plan. INR 30M in ticket sales was frozen and the Shiv Sena was asked to examine the merits once more. There a minor debate too…whether pop music should be given tax favors. After 24 years of battle and endless court hearings, Shiva Sena decided to reinstate the waiver.
📢 The Final Statement. State minister Subhash Desai said on Tuesday (19th Jan’21) evening that the cabinet had passed a resolution to “waive INR 3.3M (about $45k/£33k) of entertainment tax for Michael Jackson’s 1996 concert”. The money is likely to be now claimed by the private event organizer.
Yet another example of how the wheels of Indian bureaucracy grind so slowly.
👇Ah! And Also This.
What went down in the Netherlands last week? Prime Minister Mark Rutte and his entire cabinet resigned. The reason was a child welfare fraud scandal. More than 20000 families were damn of committing tax fraud over the course of years leading them into financial ruin. They were told to pay back tens of thousands of euros. The Tax Authority gave in to singling out dual nationality families and was alleged of systematic racism. “Fundamental principles of the rule of law” had been violated. Rutte said “mistakes have been made on all levels” and found it “fair” that the cabinet steps down. It will stay on as ‘caretaker’ until new elections are held in March. What’s next? The gov will cancel debts owed by those families and pay them over $36,000. And several of the families are reportedly suing for racial discrimination, among other things.
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⚽ The FIFA Tax Bubble – Crazy Tax Story
📜 SA’s Revenue Laws Amendment Act 20 of 2006. This is what FIFA demanded as a price for allowing South Africa to host the 2010 World Cup. The legislation stated: “The Act creates a “tax-free bubble” around FIFA-designated sites so that profits on consumable and semi-durable goods sold within these areas will not be subject to income tax; neither will VAT be applied.”
🏗️ What are these sites?
- the ten World Cup stadiums
- any FIFA-designated exclusion zone
- any official tournament parking area
- press and television centers set up for the tournament (including the International Broadcast Centre)
- certain training sites during official FIFA-sanctioned training days at those sites
- official host city public viewing venues (also known as fan parks)
- certain areas for VIPs
- any other area or facility utilized for official 2010 events as agreed in good faith between FIFA and SARS
😩 Hurting Poor Countries. World Cup preparations cost South Africa an estimated £3B($4.9B). This also applies to the various organizations designated as FIFA’s commercial affiliates, licensees, host broadcasters, broadcast rights agencies, merchandise partners, service providers, concession operators, and providers of hospitality.
While you might be focussing on FIFA’s extravagant tournament, you might never know about FIFA’s corrupt practices.