Thanks, James for your remarks and for looking at the blog.
It is interesting why we can't seem to get to grips with tax avoidance and evasion. I think what you suggest is fundamentally true - that policy makers are frightened of driving away investment if tax is collected too effeiciently or at too high a rate. You are also right to mention what is, I think, called the 'Laffer Curve ' effect by economists. This is that, the higher the tax, the less is collected because people have a greater incentive to avoid high tax rates. It may work, though I am sceptical as I suspect the culture of tax aversion is too deep seated here.
How about, though, an idea that operates in Norway, I think ? The amount of tax each individual or compant pays each year could be publicly available. This might, just might, create a climate in which more people might be more willing to pay the tax due. I am not wealthy but pay a good deal of tax because I earn a good deal, and I am proud of how much tax I pay because I am contributing to the country's services and welfare. I don't like paying it, but recognise I should contribute. If I learned that a premier league footballer paid, say, £2 million income tax last year I might feel more kindly disposed to him and his ridiculously overblown salary. Sadly I suspect that most of them pay considerably less through legal avoidance schemes.
Finally there is the American system. We could do away with tax exile status. If you are a British citizen you should pay tax on what you earn in the UK, wherever you live. As soon as you set foot on British soil, the tax authorities wil present a tax demand and you cannot leave until you pay it.If anyone wants to avoid UK tax I think they should live abroad permanently.
There is here, by the way, an obvious link with events of the last week in our city centres, isn't there ?
1 comment:
Thanks for your reply.
Both of your ideas are vaild- especially the public avalablity of tax recipts. Like the MPs' expenses- more openness of the system and enabling citizens to view such recipts/figures certainly aids transparancy.
What i just cannot fathom (and again excuse me from repeating myself) is the fact that the goverment's refusal to change the way that tax avoidence can (easily?) be achived by companies and wealthy individuals- and, moreover, even 'every day' folk partake in this activity on a smaller scale (employees belonging to a union having a professional subscription,,,nursing times etc) can claim a bit back in the tax system- ditto academics getting a bit back from purchasing of books etc.
In summary, I just cannot fathom (and sense some dark ulterior motive) that the government can't/won't crack down on what is potentially 2X the revenue that is spent on the NHS in a year!!
I'm all for cracking down on those that are too idle to do a decent day's work and leave it to tax payers like you and I to put food in their mouths, as they go through life sponging off society (acknowledging the fact that there are genuine people that have unfortunately become unemployed due to losing their jobs, but usually contribute to the system- it could happen to any of us), but what is spent on welfare is a fraction of the lost revenue to major tax avoiders.
It don't take a genius to see that this needs sorting,,,,we hear politicans talking about cracking down on this and that,,,spending cuts etc, but HARDLY ever hear them discussing major tax avoidence. Perhaps one day the media/news will really start to push it- as, after all, the media's agenda setting potential- and how they frame issues is potent.
Post a Comment