It comes as no surprise that the Hong Kong and Shanghai Bank (HSBC) have been merrily helping many hundreds of greedy businesses and private citizens to dodge their tax responsibilities. Billions of pounds have been lost to the British Treasury. It is of course a national disgrace but it is one that has been happening since the idea of taxation was first conceived.
Many of the great stately homes of England with their associated country estates were built on the back of tax evasion. Lots of wealthy people arrogantly resent paying their dues to society and do whatever they can to reduce their tax bills. They open offshore bank accounts in secretive places like The Cayman Islands, Switzerland or Jersey and they employ financial advisers and accountants specially to deprive The Exchequer of its just deserts. Tax evasion or tax avoidance are both the same to me. With regard to taxation, bending rules is as bad as breaking them.
The Musketeers' motto - "All for one and one for all" should be the principle of taxation for none of us exist alone. We all belong to societies that need roads, social services, schools, hospitals, police, soldiers, museums, libraries, cemeteries, relief for the unemployed, parks, airports and railways. These things cost money and we must each play our part in proportion to our earnings, following the rules. If we don't do that we are cheating our fellow citizens.
There can be no doubt that the HSBC bank is not the only one that facilitates tax evasion. They are probably all at it. Recently Her Majesty's Revenues and Customs have been working harder than ever to claw back unpaid taxes but unlike the pauper who steals a loaf of bread from a supermarket, the rich tax evaders have generally not found themselves facing criminal charges in a court of law. HMRC seem to imagine that it's getting back the money that is the important thing. So these dodgers have been getting off scot free instead of going where they belong - into jail.
When this week is over and the brouhaha about tax evasion and Swiss bank accounts is over, the tax dodging and creative avoidance of tax will carry on just as it always has done. There will also be men and women in the Houses of Parliament whose tax affairs will remain very suspect. Probably the same esteemed representatives who happily abused the expenses system.
Meanwhile ordinary workers like me and Shirley have paid every penny we were meant to pay. We had no choice but even if we had had some leeway for avoidance we would not have gone down that route. Cheating is wrong and tax evasion is a heinous and extremely selfish form of theft. The guilty ones are indeed like pigs with their snouts in the trough.
My mother (1908-1983) used to say that she was happy to pay her taxes, that she was glad she had enough money to be able to pay taxes. She was a good woman!ReplyDelete
Taxes are like the price we pay to be members of the club we call society.Delete
I completely agree with you. One percent of the people should not control 50% of the world's wealth.ReplyDelete
Now I know why you are called Red!Delete
This was (and stil is) a BIG issue in Germany in 2013 and last year, when serveral tax evasion/avoidance scandals rocked the national lsndscape. It came to light that someone had sold the government a CD with the account data of many citizens who were hiding their money outside Germany. This had been going on for years already, but only now it was hotly disputed whether the tax boys had the right to follow up on the data others insisted were illegally acquired.ReplyDelete
Then, some big names started come out with voluntary disclosures, hoping for amnesty (or at least reduced punishment). The most famous of them was Uli Hoeness, who is immensely popular in Germany due to his contribution to football (see the wikipedia article about him).
When he "gracefully accepted" (!) his (much reduced) punishment, even Mrs. Merkel was daft enough to say she "respects him for accepting" it. Hello? Respect? For accepting a judge's verdict who merely acts on what you already know you've done anyway?!
RJ and I were often talking about this when it was the top story in our news. Things seem to have calmed down since then, but all this is still going on.
Like you and Mrs. Pudding, I always pay what I'm due. It's not very nice to see what my monthly earnings amount to after tax, but it's still plenty enough for me to afford everything I need - and more.
The pigs are everywhere. These revelations and court cases are like hiccups to them. They will carry on feeding from the trough.Delete
I am intrigued by your last word - "more" and wonder what that might be.
It simply means that I have enough money left after tax to afford more than just the bare necessities: I can have nice clothes, go on holiday, host parties, buy presents for friends and families, and so on.Delete
Oh, I shouldn't have been so suspicious. Sorry.Delete
I paid/pay my dues, too, and have never fed at the trough. I wonder what people would say or do if no one whatsoever paid their taxes? I've often wonder what the complaints would be then! We'd be living in a third world country and they they really would have something to whinge about!ReplyDelete
The pigs habitually complain about governments wasting money in order to justify their selfishness.Delete
Like you YP I was a public servant in the UK and as a result had no opportunity for tax evasion or avoidance because tax was deducted by my employer. I also had my own business for many years and was scrupulous about tax matters. However it's not just the fat cats who indulge in tax evasion and avoidance. The number of tradesmen I know who insist on being paid cash and quite openly boast about not paying tax is staggering. Just as staggering is the number of people who openly boast about claiming every penny from the State whilst still working in the cash-only economy. I resent the fact that they regard honest folk with contempt and thus I resent them every bit as much as I resent the very wealthy doing it.ReplyDelete
Good point Graham. When a tradesman winks and suggests I can pay him less if I pay by cash I always want to say, "Excuse me? I am a tax inspector and you are nicked my son!"Delete
If you did that YP it would soon get around and you'd never get anyone to work for you!Delete
I agree tax evasion is evil. I suggest it starts at the very top with the monarchy and filters down to the plumber. The working man is only emulating his betters.ReplyDelete
As you say Shirley is not one of them but NHS nurses are regular moonlighters as are some teachers who offer extra tuition after school.
I know a couple of teachers who provide extra tuition and they declare their extra income to HMRC though I expect there are some dodgers in the teaching profession too.Delete
The only part of your post I fundamentally disagree with is this, 'in proportion to our earnings'. If we want a truly egalitarian society, why should one man pay tax at a higher rate than another? If we want growth, why punish success? EVERYONE should pay the same rate of tax (too high at the moment) and the tax allowance should be set at a realistic level (too low at the moment) to help low income earners.ReplyDelete
If a country sets certain tax rates you might disagree with them for philosophical reasons but the law is the law and we cannot pick and choose which laws we will obey be they to do with thievery, driving or taxation.Delete
I certainly get where you're coming from but I have a question. Evasion is bad, certainly, but what do you mean exactly by "tax avoidance"? Are you talking about legitimate, legal (as in government-concocted and government-approved) deductions such as we have in the U.S. on home mortgage interest and being over 65? I don't consider those as "avoidance" when we're simply following the rules as laid down by the gummint. Should I be adjusting my gross income upward by the $5,000 or so that I paid to banks as home mortgage interest when the government itself tells me I needn't? Or saying "Yes, we are over 65 but let's not check that box so that we can pay a bit more to Uncle Sam? Finally, is putting money in such places as the Cayman Islands (not that I ever have done or plan to do such a thing) "avoidance" or "evasion"? I need definitions.ReplyDelete
P.S. - If you think the first two deductions I mentioned constitute "avoidance" then, with all respect, I think you are daft.
The distinction between evasion and avoidance is not entirely clear to me. Evasion is clearly deliberate wrongdoing but avoidance seems to be about stretching the rules to the limit and maybe hiding funds in foreign lands or in other people's names through dubious financial gifts. Government approved deductions do not fall into either category.Delete
I wouldn't mind paying my taxes so much if I could file them with a form that had things checked off that I want to support. I resent that most of my money goes to wars, bailing out banks, and subsidizing things I don't believe in. My vote counts for nothing, the Koch Brothers buy half the candidates. I consider it taxation without representation. It's even worse at the county level where my horrendous property taxes go to subsidize improvements that developers want so they can turn thousands of acres of farm and grazing land into a profit for themselves.ReplyDelete
I must say that I have never resented paying tax though I do resent the fat cats who dodge it and therefore effectively increase the tax bills of honest citizens.Delete
Everybody should pay their fair share to ensure the less able, the sick, the uneducated, the veterans of foreign wars, etc. will have food to eat, a hospital bed, books to read and proper care from our government for mental and physical wounds from those wars.ReplyDelete
But, I have wondered for years and years why the richest of us get to pay less for Social Security. I heard on the news yesterday that the top 2% of earners in the United States will reach their maximum payment into the Social Security system this week. That means that they are exempt from that tax for the rest of the year while most of the rest of us will never reach that maximum yearly income.
We too have lots of people who "moonlight" in this country. Usually people who do not get paid enough in their regular jobs....a lot of time they are public servants....firefighters, policemen, teachers, etc.
Are you moonlighting as a quilter Mama Thyme?Delete
I think that most of the super-rich are the same the whole world over. "I'm all right Jack - pull up the ladder!"
Wise words! Couldn't agree more. Apart from rich businessfolk and politicians, what really winds me up also is when those who pretend to be our role models, or live off our adulation, also do it - I'm referring to superstars in the world of music (yes, Bono, that's you too) and patriotic sports people. Everybody has a go at politicians for fiddling the books but when it's Messi or Wayne Rooney, it's a different kettle of fish.ReplyDelete
As some of you say, it's an illness reaching through all levels of society, though. Being (sort of) self-employed myself, I have also had many a chance to fiddle taxes (skip VAT for example) but so far (touch wood) have stuck by my principles and kept the books (and my soul!) clean.