Bono Creates A Stink With His Dutch Lovin’
In the good old days of rock-star tax-dodging, anyone hoping to avoid the government simply had to to hole up in a private French estate with a bag of heroin and Gram Parsons. But as U2 and the Rolling Stones have discovered, it’s now much easier to
launder funnel money through Holland, where the government is eager to set up new “mailbox companies,” and where artists can enjoy extremely liberal royalty-tax laws. That’s all well and good if you’re a greedy git like Mick Jagger, but it’s created something of an image problem for saint-in-traning Bono:
Last June, with the Irish tax break [for artists] about to shrink, U2 heeded the advice of its longtime business manager, Paul McGuinness, and moved its most lucrative asset — a song-publishing catalog with hits like “Where the Streets Have No Name” and “It’s A Beautiful Day” — from Mr. McGuinness’s firm, located near the Liffey River in Dublin, to Promogroup, which operates beside the elegant Herengracht canal in the heart of elegant, old Amsterdam…
“Ethically in my opinion, Bono’s tax arrangements are entirely inconsistent with his calls upon government to support anti-poverty drives,” said Richard Murphy, who runs Tax Research LLC, a research institute based in Norfolk, England, and was one of three co-authors of the SOMO report on Dutch tax shelters. “You cannot be demanding that resources be allocated to anti-poverty drives and then deny those resources to government.”
Other tax experts say that such views are overly prim and that rock stars are simply following the leads of some of the world’s biggest companies. U2 and the Stones “are taking advantage of this in the same way that all the drug companies are putting all their patents in favorable tax jurisdictions,” said Prof. Michael J. Graetz of Yale, an authority on tax shelters and a self-described die-hard Rolling Stones fan. “I wouldn’t go so far as to say it’s fair, but it’s not shocking either.”
We’re sure Bono will cringe at that last quote–nothing hurts your cool-guy cred more than being compared to a Pfizer CEO–but don’t expect him to pull out of Amsterdam anytime soon: As much as those limousine-liberal accusations may sting, not even Gandhi himself would turn down the opportunity to make a few extra pennies on those Zooropa baby-tees.