20 2 mins 9 yrs

I will be on the BBC in about an hours time debating the current Jihad by the Conservative led Government against what they call “tax avoidance”. What, you may ask, is tax avoidance? Well, it appears it now is being stretched to include those who employ accountants to legally minimise the tax they pay to the State. Indeed it now is being claimed that it is “immoral” to pay cash in hand to tradesmen since that too avoids tax. On this logic, are ISA’s also immoral? This is a lunatic argument that is being proposed by Conservative Mark Gauke and irony of irony can you guess what his wife does for a living? Yes, she’s a tax avoidance lawyer!

The way to deal with this issue is to simplify our incredibly complex tax laws. People will naturally seek to avoid paying tax if they can – and a good thing too so long as done legally. But if Government wants to increase tax yield then introduce a flat tax and enforce it.

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20 thoughts on “THE FAUX MORALITY OF THE POLITICAL CLASS..

  1. From the BBC link:

    “The government has highlighted its desire to clamp down on tax avoidance.”

    Erm, tax avoidance is legal. Recently, someone in here predicted that as economies and taxes decline, the savage beast will become more deseprate and imaginative in how it loots us. This is the context in which this must be seen. It’s not about the law and morality; it’s about the State’s relentless campaign to take as much of our lives as it can.

  2. Exactly a flatter fairer much simpler tax regime properly enforced with huge penalties for transgression. We would need far less civil servants to administer it as well. They know this which is why our mandinarate masters will NEVER permit mere governments to introduce it. Smaller cheaper better government is poison to the ruling elite.

  3. I agree that a simpler tax code is required but that doesn’t mean a flatter one. There is no evidence to suggest that a simple, flat tax would be less harder to avoid than a simple, progressive tax. The principle reason for tax avoidance is the huge number of ill-defined exemptions from the tax system. That is how these systems work. Remove those exemptions or tighten the definitions for them and tax avoidance will go down.

  4. Caught the tail end ten minutes David. Well reasoned, and I hope someone will reform the tax system soon Ha Ha!
    BTW
    There then followed a debate on selling alcohol.
    Was that because of you, or was it scheduled anyway? 😉

  5. I think Bumper would fit right in with the democrats here in the states, everytime you brought up the fact that the top 10% pay 50% of the tax he basically said it was a lie, and the way he scoffed at a flat tax showed his complete lack of understanding.

    good segment

  6. There has been a requirement for several years for promotors of tax “schemes” to report full details of the schemes to HMRC as soon as they are devised. The schemes are then given a reference and anyone using them has to disclose this on their tax return.

    The “jihad” is against rogue accountants who are devising these schemes but ignoring the disclosure rules.

  7. Seamus: flat tax is normally presented as a lower rate across all income spectrums with no legal loopholes. Flat tax hypothetically raise more taxes because tax avoidance drops – the wealthy don’t seek the expense and complication of legal tax avoidance if the expense of paying the tax is equal or less than the expense of avoidance.

    Even though individual rates drop in some instance with the flat tax, the drop in tax avoidance makes up for this and the flat tax results in greater revenues for the government.

  8. Immoral = government abuse of power with its punishing tax code and its waste and corruption, favoring of friends and special interests.

  9. All sensible people agree that a country’s tax laws should be written on ONE page of A4 paper – simple, without exemptions, and low rates. But every year when the numpty who is the UK’s Chancellor of the Exchequer produces his budget, it is a veritable tome of uselessness and stupidity – and worse, it’s deliberate.

  10. “Even though individual rates drop in some instance with the flat tax, the drop in tax avoidance makes up for this and the flat tax results in greater revenues for the government.”

    Theoretically. In reality less likely. Considering the bottom rate of income tax is 10% a flat tax would either massively decrease revenues (if set at 10%) or massively increase the tax burden of some very struggling people (by setting it higher than 10%).

    The fact is that a simplistic, progressive tax system is possible as well. It doesn’t need to be flat to be simple.

  11. Seamus, to be perceived “fair” income tax has to be flat – everybody pays the same rate, no exceptions.

    If tax is perceived “fair” there is less motivation to cheat – and if its on the low side, the cost/benefit of cheating is reduced.

    If a tax is progressive – some paying more than others – in addition to outright cheating, there will be legal exceptions and loopholes because the government/taxing authority is already picking winners and losers and politics are politics.

  12. Fairness is a subjective idea. What one person considers fair another won’t. Maybe to perceived by you as fair it must have everyone paying the same rate. I think asking someone with £10,000 a year to pay 20% (leaving them with £9,200 a year) while also asking someone with £1,000,000 a year to pay 45% (leaving them with £565,900) is a lot fairer than asking both to pay 30% and leaving the less well of person with £400 less.

    Also, why will there be legal exceptions in a progressive system. If you got rid of a the complexity in the tax system, but kept a progressive system with no exceptions how would that not be immune to tax cheats?

  13. Seamus Why?

    I mean that seriously. Why should there be a different rate?

    If a one man earns 10,000 and another man earns 1,000,000. The man who earned the million worked harder, better, and more profitably than the one who earned 10 thousand.

    Why should he be punished by a higher rate?

    Should the better Soccer player where 15lb ankle weights because he is better than other players?

    People are created with equal rights, not equal abilities or talents.

    Your inadequacies are no one elses fault, so why should they have to pay more of a percentage than you?

    What makes you better than them that you should pay less of a percentage?

  14. Its not a punishment or a penalty or an attempt to even the playing field a bit. The reason why the person who earns more should pay a higher proportion of their income is due to the fact that services cost money. They have to be paid for. I would prefer they are paid by the richer person who will no longer be able to buy that Ferrari rather than the poorer person who will no longer be able to buy bread and electricity.

    “The man who earned the million worked harder, better, and more profitably than the one who earned 10 thousand.”

    That isn’t necessarily true. The person who earned a million simply works at a job that the market has valued at a higher rate than the person who gets paid 10 grand. The market value is developed by supply and demand not hard work and ability.

  15. supply and demand are the keystones of hard work and ability.

    You don’t even understand that what you just wrote is marxism, do you?

  16. “supply and demand are the keystones of hard work and ability.”

    Supply and demand have in some cases links to hard work and ability. In other cases they have nothing to do with it. Demand is based simply on demand. On how much people want it. Supply can have some link to hard work and ability but it also isn’t quanitified by it. A doctor who is talented, works hard and works 70 hours a week is less likely to get paid as much as a major athlete. Is Lebron James’ ability to put a ball in a hoop more important than a Doctor’s ability to save lives? Does he work harder at that than some doctors? Yet because of supply and demand his salary is significantly higher than that of the doctor.

    “You don’t even understand that what you just wrote is marxism, do you?”

    Oh no not the big bad M word. While some people (Petr and Pete) take extreme positions when it comes to Marxism vs Capitalism others take a more nuanced approach and merge both doctrines. So yes some of my beliefs will have both elements of Capitalism and Marxism in it. The fact that I care more about a family struggling to heat their home more than I do about a millionaire struggling to re-gild his mansion is something I’m quite happy with.

    So I do understand that it has Marxist undertones. What you fail to understand is that I’m not bothered by that.

  17. I care just as much about that struggling family, I don’t believe that because a family is struggling it has the right to steal from their neighbor.

    A doctor in the UK and maybe here in the next few years may be in that position, but as of now a doctor that has spent 12 years of his life in school earning and that’s what he or she is doing by dedicating those 12 extra years to school they are earning the right to perform a job that others can not do. and here right now a good doctor can earn as much Lebron James. It’s also why when the richest people in the world get sick they come here, not england.

    Capitalism is not cold hearted to the poor, and the last people anyone should appoint to take care of their needs is government.

    You may not be bothered by the theft of your property by the government in the name of others, but I am.

    Your looking at this from a point of view that people need to be forced to provide aid to their neighbors. I call that Tyranny. and from personal experience I have found that my fellow man is both more generous and helpful than any government. If that has not been your experience I’m sorry.

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