By Kevin Reed NewsHas the Starbucks tax avoidance controversy taught us anything?22 Jan 2014 The corporation tax political circus has swung from fiasco to debacle, with some big companies dragged over hot coals by the Public Accounts Committee (Starbucks), while others appear to get off scot free (Vodafone). Accountancy Age Editor, Kevin Reed, weighs up whether we have learnt anything at all from the tax debate.There’s nothing like the festive holidays to take a break from the drudgery of life – the work that has been never-ending … and the Public Accounts Committee’s interminable and often embarrassing forays into questioning how companies and advisers game the tax system.The committee, chaired by Margaret Hodge, has achieved little more than political point-scoring. There has also been many a cringe-worthy moment when the parliamentary inquisitors have questioned tax strategies based on legislation that the same MPs had voted in. Hypocrisy rules.Does Margaret Hodge deserve the moniker ‘Tax Prat of the Year’?The level-headed editor of Taxation, Mike Truman, awarded Margaret Hodge ‘Tax Prat of the Year’ last February, perfectly reflecting the thoughts of many in the tax community. But let us not forget that there are self-interests at play: without complexity there can’t be tax strategies, and without strategies there’s no work for tax advisers.While many of those questioned by Hodge and her colleagues – particularly those from the tax profession itself – spoke sensibly and openly, some of the corporate representatives were more evasive and less convincing.So where are we in this farcical saga? Grab a coffee. With the highest-profile case, Starbucks, we may have reached the endgame. Or perhaps it’s just the end of the first set. It’s still not particularly clear who won the game that is Starbucks’ tax affairs (although you don’t see many empty Starbucks outlets). What we do know is that Starbucks finally paid corporation tax – £5m of it.The payment, for the company’s first UK tax bill since 2009, wasn’t a charitable donation – heaven forbid what tax-deductible PR disaster that might have led to. Instead, the mega-coffeehouse decided to ‘forgo certain deductions’ and so create a £10m tax bill, with the remaining £5m to be paid later in the year.Were Starbucks right to create a £10m tax bill to appease a PR disaster?Whether such a move will be appreciated by shareholders of a public company is highly questionable. Some may even wonder whether such a tactic could be considered a breach in the duty of care to shareholders in relation to minimising the tax bill.That said, taking egregious measures to avoid tax can cause such reputational damage that avoiding avoidance could be for the best, strategically, for the company’s fortunes and therefore its stakeholders.Nobody can deny that the aggressive tax avoiders, using schemes that were contrived to create arcane mechanisms entirely tangential to the business being undertaken, deserved a good kicking. But the collateral damage following the political games played by Hodge and her friends runs wide and deep.Why tax advisers take the brunt of tax avoiding furoresTax advisers, many of whom have long ago been put off endorsing schemes that pushed the boundaries too far, have seen their profession take yet another knock in the fallout of the credit crunch.For their part, MPs have cemented the view that they have little understanding of how businesses work – and I reiterate my concern that their take is borderline anti-capitalist in a capitalist country.But, as the seeds of economic growth take root, we can only wait and see whether the perception that the UK is a great place to do business has been damaged. Few come out of the whole debate with a better image than when they went in – although perhaps Hodge et al will happily take the flak if it means the debate is aired further.How did Vodafone get off scot free with its Verizon sell-off?Some of the faintly moronic media questioning of how Vodafone is left without a tax bill for its sell-off of its Verizon shareholding – when it is clear that the deal structure clearly leaves Vodafone without a tax bill – shows that few of my colleagues in the press have learned or taken on board the nuances of the tax debate.And as for Starbucks? The company will have to be whiter than one of its vanilla lattes if it is to avoid another roasting by the hypocrites on the Public Accounts Committee. Kevin Reed is the former Editor of Accountancy Age.