Firm chose haven, let's give it hell

Paper calls for boycott if publisher does not pay UK tax 'lost' after Swiss move. Paul Jump reports

November 1, 2012

Academics should boycott Taylor & Francis Group journals if its parent company does not pay the money lost to the UK Exchequer when it moved to a tax haven, a forthcoming paper will argue.

The strongly worded paper, "What are we to do with feral publishers?", has been written by four academics from the University of Leicester's Centre for Philosophy and Political Economy.

It highlights the case of Informa, a multinational publishing and conference company, which moved its corporate headquarters from the UK to the low-tax Swiss canton of Zug in 2009. This has cost the UK Treasury "something in the order of £13 million", the authors state.

The paper, which has already been published in the online version of the journal Organization and is forthcoming in print, notes that according to its 2010 accounts, Informa's publishing division recorded an adjusted operating profit margin of 35 per cent.

Gross profit margins, which exclude overheads and which the authors say might give a more accurate indication of profitability, were not available, but the paper estimates them to be more than 70 per cent.

It adds that while "Informa's tax avoidance does render it as something of a moral outrider here, it is far from alone in scalping the public purse for private profit in pursuit of disinterested truth".

Based on an analysis of recent accounts, the paper puts the operating profit margins of other large commercial academic publishers at up to 41 per cent.

It says this makes journal publishing the most profitable of all industry sectors.

It adds that academics should consider boycotting the Informa imprints Taylor & Francis and Routledge if the tax lost to the UK Treasury since the firm's Swiss move is not paid. In that event, they should also "consider offering support, even if only verbal, to those who would more freely distribute [Informa's] copyrighted material".

But a spokesman for Informa said the paper's credibility was undermined by a number of factual inaccuracies, and pointed out that the company still pays full tax on its UK profits as well as employee contributions for its 2,500 UK staff.

He added that the company's move to Switzerland was prompted by fears about proposed tax regulations - since abandoned - that could have led to firms being taxed in the UK for their global profits, even if they had already been taxed in the countries in which they were generated.

The paper also calls on Organization's publisher, Sage, to lower its price to that of comparable society journals. If it does not, the authors say, Organization's "editors, writers and readers" should desert it and establish their own identical journal. The paper puts Sage's operating profit margin at just under 19 per cent.

Ziyad Marar, global publishing director for Sage, confirmed that after a "long, slow start", the 18-year-old journal was a "commercial and academic success". He added that the profitability of some Sage journals "enables us to continue to take further, long-term commercial risks in launching other titles that represent important, marginalised or emerging voices".

"Even if we are one of the subjects of this particular article's critique, we strongly support these authors' right to free expression as we would their right to set up an alternative journal," he added.

paul.jump@tsleducation.com

http://tinyurl.com/8nvezjs

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