Is Virgin Atlantic’s claim for a bailout legitimate? – Miles Dean
Miles Dean, Head of International Tax, comments on the news that church leaders have said that tax dodgers should not have access to the government bailout, in International Accounting Bulletin.
Miles’ comments were published in International Accounting Bulletin, 27 April 2020, and can be found here.
“Following news that senior clergy including Rowan Williams, the former Archbishop of Canterbury, have said companies registered in offshore tax havens should be refused government bailouts, Miles Dean, Head of International Tax at Andersen Tax UK offers a comment
“Virgin Atlantic is a British airline. 49% happens to be owned by the American airline Delta (who have said they will not bail Virgin out, as they have their own house to look after). Sir Richard Branson’s offshore holding structure owns the balance. Branson’s personal tax affairs and the fact that Virgin Atlantic is foreign-owned appear to be the reason why the request for a government bailout has been met with such scorn. But this doesn’t add up – either Virgin Atlantic qualifies for a bailout from the Government or it doesn’t.
The “campaigners”, up in arms at the bailout request, are myopic in their agenda pushing. The fact that a UK headquartered airline has foreign shareholders should have no bearing on whether the company has a legitimate claim for a bailout. The business is quite clearly headquartered in the UK and was, until the Covid crisis, reportedly on the way back into profit. It employs hundreds of staff in the UK and provides economic benefits, not least in acting as a major competitor to British Airways. It also changed the way in which we fly – for the better. Unlike many of the low cost airlines that are so prevalent today, Virgin Atlantic sought to provide a superior service, from providing limos to shuttle you to and from the airport, to lounges that really were VIP. For these reasons alone, Virgin Atlantic deserves a hearing.””