thanks, yes, i agree with you, and this is why the UK must abide by the recommendations of the "Revive British Industry" campaign...
https://massey276.wixsite.com/revive
WARNING: This post has been created in a light-hearted (semi-joking style), and only vaguely, if at all, represents reality. Hopefully the jist is still partly correct.People sort of have to accept, lots of hard business facts and realities.
The 1950s has been and gone, and probably is not going to return, anytime soon.
For example, let's say I had an identical twin brother, and we both were as good (or bad), at high tech stuff, as each other. So we jointly, invent, this wondrous new type of LED lighting system, which is assembled out of normal electronic parts, but otherwise is a great invention.
We each have £100,000 in cash (bank loan), to start up a new business.
So, I start one such business in the UK, and my identical twin brother starts up a completely separate company in the best Electronics part of China for doing stuff like that. The Chinese government agree to this business, with no strings attached. (unrealistic, I know, they will want approx 49%/51% of the company and/or significant Chinese involvement, plus they will want its IP). N.B. All figures very approximate, and NOT 100% realistic, I know!
So, in the UK, I would have to pay, something like £1 for a suitable set of transistors for the device.
My Chinese identical twin only has to pay £0.05 for the set of transistors.
I have to pay an additional £5 for the device to be manufactured in the UK.
My twin only needs to pay £0.25 for quality Chinese manufacturing (he found a good quality factory there).
I have to pay £3 import and other taxes, he only has to pay £0.10 taxes and fees.
So the LED lamp, made in the UK, costs £20 per lamp.
But my twin brothers lamp, in China costs £1 per lamp.
We both sell the lamps mail order.
I need to charge £50 to the UK customers. Cost breakdown, £20 per LED lamp, £10 profit, £10 delivery charge, £10 VAT. Total = around £50.
My identical Chinese twin brother needs to charge £3 via ebay, to deliver them to the UK. Doesn't pay UK taxes, such as VAT. Should, but in practice I think Chinese sellers get away with it.
At £50 final sale price, I manage to sell 2 LED lights. So I received £100. Made £20 profit. Had to pay £10,000 to hire the unit and busines tax rates and Electricity bill.
Total profit = -£9,980 over 12 months.
The Chinese company, my identical twin brother, sells 100,000 of the LED lights, £3 each.
Makes £1 x 100,00 = £100,000 profit.
After paying £500 in Chinese taxes and £0 in UK taxes/VAT, and £200 for the rental of a unit in China.
Total profit = £99,300
So a question.
Which one of the twins, is driving round in a shiny, Red Ferrari, with a nice wife/girlfriend, while driving to their nice luxury home, in China ?
And which one is being man-handled by court bailiffs, over £9,980 they owe to the bank. Sleeping rough and getting very cold and wet, in the British weather ?
WARNING: This post has been created in a light-hearted (semi-joking style), and only vaguely, if at all, represents reality. Hopefully the jist is still partly correct.