Avoidance and evasion is like chalk and cheese

Avoidance and evasion is like chalk and cheese

by Brian Monteith
article from Wednesday 22, November, 2017

OTHER THAN DEATH ITSELF, there are few things as nauseous as the stench of hypocrisy when politicians talk about tax evasion.

I shall choose my words carefully, for it is clear that the BBC and most of our political elite do not, and words mean a great deal. For instance, they can mean the difference between having a well-deserved reputation as an upstanding citizen, or being branded a cheating rogue deserving of a criminal record.

Today is budget day and there can be no doubt that the issue of tax evasion and avoidance will be mentioned – and mistakenly conflated. It will be intentionally so and is an example of politicians at their worst. A few weeks ago we were assailed by the allegedly scandalous and shocking stories of tax dodgers ripping apart Britain’s public services while making the poor poorer and our austerity ever harder to bear.

In particular the BBC, cheered on by the Guardian, banged on about how the “Paradise Papers” reveal the secrets of tax dodgers, and the lengths such scoundrels would go in pursuit of “evasion and avoidance”.

When speaking to the Confederation of British Industry, Jeremy Corbyn ripped into the Queen, by suggesting that all who, like Her Majesty, take advantage of tax shelters should apologise to the public, and are the cause of everything from NHS queues to housing shortages.

Not to be outdone, the Prime Minister (who should know better but revealed a degree of ignorance or mendacity that is highly worrying) claimed that some £160bn had been recovered from tax “evasion and avoidance” since 2010.

They are all at it, you see. Corbyn, Theresa May, the BBC, and so many of our legislators are meant to understand how words are the bricks that build laws, and yet they repeatedly conflate “evasion” and “avoidance”. These words, along with the term “tax dodgers”, are thrown around as if they were similes used to lighten their limited vocabulary.

The impression given was that, short of stealing from food banks for a Buckingham Palace soiree, our Queen could not have betrayed us more. Formula One world champion Lewis Hamilton could not have become a greater target for our envious bile.

Then there are those three actors from Mrs Brown’s Boys, who, after being confronted with microphones shoved in their faces, had to take advice as they hadn’t understood the questions hurled at them.

When we step back and look at what has happened in these last few days, what we have is the criminal theft of private information. Were it to happen to any of us mere mortals (as opposed to the super rich), this would leave us personally outraged – and with good cause.

Do you want your bank statements, pay slips, credit card bills, pension arrangements, and wills made available for your work colleagues, the sister you no longer speak to, or those nosey neighbours to read?

Even with that bonanza of information that fed accusations and allegations aplenty, no criminal law breaking has thus far been demonstrated. While their internet security may have been hacked, Appleby’s financial advice appears to have been watertight.

When launching such a series of news breaking “investigative” programmes, one expects a real ball-breaker early on to get everyone interested. So, the super rich have money stashed away legally. Are we to conclude that this is the best the BBC and its cohorts can do?

It is when there is the least law breaking that the sanctimonious come into their own, talking up an accusation and lathering on their moral indignation. This is where the reek of rotting hubris pervades our body politic. For example the holier-than-thou tweeting of Gary Linacre – then almost immediately exposed as having used an entirely legitimate scheme to avoid tax on purchasing a Caribbean home. And then there’s the Guardian itself, which used a tax-exempt shell company in the Cayman islands to avoid paying corporation tax when it sold its 50.1 per cent share in Autotrader for approximately £650 million in 2008.

Want to know more? The Labour party made a £4.3m profit last year but paid no tax. It benefits from renting its HQ from an offshore trust located in Jersey. The shadow chancellor has a personal pension worth £14,000 per annum managed by a Guernsey firm.

Yet still Jeremy Corbyn seeks to shame those such as the Queen, who still works at 91 and has paid tax voluntarily for the last 25 years, even though she is not liable to. She has no offshore tax shelter, for she is also Queen of Bermuda, the Bahamas, Gibraltar, the Channel Islands, and any other Crown dependency you care to mention. (The clue is in the name.)

Tax evasion is a crime, and should be chased down and dealt with.

Tax avoidance is retaining what is rightfully yours within the law – and it is the government itself that provides the greatest encouragement for avoidance.

It suits the government to encourage people to save, so it establishes ISAS – and offers thousands of other tax-efficient schemes and allowances to try and direct our behaviour. And, perniciously, amongst this morass of rules it creates traps to tax us more, so lawyers find loopholes around them. That’s avoidance. It. Is. legal.

Move along now, if it’s avoidance there’s nothing to see or hear, today in the Budget or when future tax records are stolen – just a bad smell of political hypocrisy based on envy and greed.

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