u2 bono tax avoidanceProtestors from the direct action group Art Uncut crashed U2’s long-awaited headline performance at the Glastonbury Festival this past Friday, June 24th.  A group comprised of artists and musicians, Art Uncut organizes creative events in opposition to major public service cuts – which involve music, comedy and short talks – in order to inform, inspire and motivate the public to action.

The group is accusing U2 – whose front man, Bono, is well-known for his anti-poverty campaigning – of hypocrisy for tax avoidance.

Art Uncut protestors attempted to release a 9ft-wide, 24ft-high inflatable balloon with the words “U PAY TAX 2?” written on it over a crowd of 50,000 people.  The demonstration was part of the group’s “Bono Pay Up” campaign, which is intended to raise awareness of what the group sees as celebrity tax dodging while the UK is in a time of austerity.  Unfortunately for the protestors, rain, mud and a team of 10 security guards deflated the balloon and ended the demonstration.

After the Irish government began limiting tax-free earnings for artists back in 2006, capping the tax-free exemption on royalties at €250,000 ($315,000), U2 moved its publishing company, U2 Ltd, to The Netherlands, where the tax rate on royalty earnings is far lower.  Basing U2’s operations in Amsterdam means that the band is only liable for a nominal royalty tax, as opposed to the multi-million-euro tax bill that they’d face in Ireland.

A number of artists in the UK – including The Rolling Stones – have taken similar steps to avoid paying income taxes.  Legal tax-dodging is commonly exploited by both celebrities and taxpayers who have substantial income that they want to shelter from their local and national taxing agencies.

By “shopping around” different countries for the best tax deal, individuals and corporations put pressure on governments worldwide to lower their tax rates, meaning less money available to improve schools, hospitals and public services.  Given the financial difficulties that Ireland currently faces, the tax revenue denied to them by U2 and other bands that have moved their businesses out of the country hurts badly.

The 2011 Glastonbury Festival went from June 22nd to June 26th and, in addition to U2, featured artists such as Coldplay, Beyonce, B.B. King, Paul Simon, Wu-Tang Clan, Mumford & Sons, The Chemical Brothers, Kool & The Gang, Big Boi, Cee Lo Green, Jimmy Cliff and Jessie J.