UK Government To Use PayPal For Identity Assurance 74
judgecorp writes "A UK government contract has confirmed earlier reports that British citizens will have the option to use PayPal to accredit themselves for public services such as the new Universal Credit benefit system. Using PayPal might be a public relations goof, as PayPal's parent eBay is notoriously clever at avoiding UK taxes, recently paying only £1.2 million on profit of £789 million (around 0.15 percent)."
All banks do it. (Score:4, Insightful)
It's not their fault, it's the Parliament making crappy laws, albeit most of them are lawyers, they either suck or are bought.
Paypal is a bank and like all banks they avoid paying taxes like the pest.
"Barclays Bank told by Treasury to pay £500m avoided tax"
http://www.bbc.co.uk/news/business-17181213 [bbc.co.uk]
http://liberalconspiracy.org/2010/10/18/banks-to-avoid-19bn-tax-bill-despite-bailout/ [liberalconspiracy.org]
http://goodbanking.org.uk/archives/684 [goodbanking.org.uk]
More interesting than tax rate (Score:5, Insightful)
Far more interesting than their effective tax rate would be how much of that money was stolen from their users?
These folks love to freeze accounts and sieze money for any reason they can find. Paypal should be regulated as a bank.
WTF? (Score:5, Insightful)
And when paypal puts your account on hold or someone deletes it then what?
Re:More interesting than tax rate (Score:5, Insightful)
PayPal is NOT a bank (Score:2, Insightful)
Hmm... strange. If you Google a bit for a list of banks in Luxembourg, PayPal does not appear on any of those lists. Can't find a BIC [wikipedia.org] for PayPal either. Which is not surprising, really.
If a (Dutch) bank where I have an account folds, my government guarantees the money in my account. At least up to a big minimum, in the order of 100k Euro or so (perhaps more, I dunno). Example: when Icelandic banks folded, the Dutch government covered losses for Dutch account holders. Perhaps except a few that had very large sums of money parked in those banks, but I'm not even sure about that. And that wasn't even Dutch banks folding.
I don't know what the rules in Luxembourg are, but you expect similar guarantees to hold for your PayPal account? Think again. And in fact, there's a number of stories around of examples where PayPal f**ked a customer, and they had essentially no recourse. Also I can directly transfer money from my bank account to any other bank within the EU (and outside EU too, with a little more patience), for any amount I like. Not so with PayPal.
So I guess the above statement doesn't mean what you think it means, and in any case doesn't mean the same as "bank". PayPal provides a service, that service deals with money, and to many it's a useful service. But that's all, it's not what we normally refer to as a "bank".
Trust (Score:5, Insightful)
Why would anyone trust a company that pretends to be a bank, but is not regulated like a bank, and so can disappear your money in an instant and leave you whistling in the wind for YOUR money? Did the government somehow find if difficult to find a company more trusted?