THE FOURTH OF JULY

[Keith Cocker]

There is a fundamental difference - avoidance is legal and evasion not!

An example - ISA's were originally established to encourage saving, particularly for retirement. Any income or withdrawals are free of tax. Assume I have £10k to invest at a rate before tax of 5%.

The cash ISA generates £500 tax free interest. If I put the money in a normal savings account interest generated is also £500 but tax of £100 or £200 is charged (tax is either 20% or higher 40% rate).

Is avoiding tax through investing in an ISA rather than normal savings account illegal.

IMHO absolutely not. We should all have the freedom to organise our affairs as we see fit. I am not condoning evasion, but the definition of that which is illegal needs to be very clear.

It is the overly complex nature of the UK tax system which encourages efforts to avoid tax. IMHO a radical reform is required to simplify, rather than continually tweaking the rules in every budget.

The distinction between avoidance and evasion is clear. The problem is that to take advantage of legal avoidance you already have to be quite rich. So it’s fundamentally unfair.

 

[selectortone]

There is a fundamental difference - avoidance is legal and evasion not!

I think most of us understand that. I believe Spectric is saying (and I am totally in agreement with him), that morally there is little difference and avoidance should be legislated against. And I'm not talking about ISAs. The huge industry of corporate tax avoidance lawyers and all that goes with it is IMHO morally reprehensible and a sad reflection on modern society.

 

[evildrome]

We had a guy that worked with us in sales who had been privately educated.

He had been a Forex salesman in London.

He was thick as mince. He used to say the damndest things... like "are sheep mammals?", is "Ecuador in Europe?"

Lovely, lovely boy. Very well spoken. Reminded me strongly of the "Tim, terribly nice but dim" Harry Enfield character.

I asked him what the maximum number of pupils per class were in his school.

He said, in his final year, the maximum number of pupils per class was six.

He said the teachers were "very, very helpful". Especially at exam time...

Honestly, he was barely smart enough to stock shelves.

He left us to sell insurance for a "private wealth management company".

 

[evildrome]

I think most of us understand that. I believe Spectric is saying (and I am totally in agreement with him), that morally there is little difference and avoidance should be legislated against. And I'm not talking about ISAs. The huge industry of corporate tax avoidance lawyers and all that goes with it is IMHO morally reprehensible and a sad reflection of modern society.

Its funny... no one ever asks... what legitimate place do tax havens and secrecy jurisdictions have in a modern democracy?

AFAIK there is no legitimate purpose.

You're either avoiding tax or hiding the proceeds of crime.

Or both.

And yet... everyone just accepts the existence of such places without question.

There seems no impediment to simply requiring all such UK territories to conform to normal UK reporting law.

People will say... if we ban it, it'll just go elsewhere.

Not so fast Mr. Bond.

The big attraction to UK tax havens is the rule of law. UK Law.

Are you going to put your ill gottens someplace that could have a coup tomorrow?

Ask the Medellin cartel what happened to their money in Panama.

 

[John Brown]

Perhaps the Rev Vennells began her management meetings with “Lettuce pray “

As a keen gardener, I think she said "Lettuce spray".

 

[RobinBHM]

What exactly is it you have against Jeremy Corbyn, Robin ? Has he harmed you in some way.

I cant give you an answer as Ive been warned not to turn this thread into a Robin -Jacob PMQS (which is a fair point)

All I would say is that 2017 election shows this country needs a new electoral system -FPTP combined with a media owned by billionaires + a parliamentary system that allows the very wealthy to influence policy, means we cant stop the rot of the last 40+ years

 

[Jacob]

Realistically? They produce id iots and talentless leaders. Johnson, Cameron, Sunak...etc.
This is the problem. In fact private education should be a bar to public office. The ones with talent go off and succeed, it's the ones without who end up in politics, finance, law, management.
Paula Vennells is a particularly extreme example but not untypical - privately educated, completely out of touch with ordinary people, an ingrained confidence in her own ability, a sense of entitlement to massive salaries and bonuses, but dreadfully incompetent.

National service on the cards. Cleverley has a point:

 

[Spectric]

And I'm not talking about ISAs.

Exactly, why should someone earning huge sums of money be able to move money to the Caymen islands to avoid paying tax on money that was made in the UK whilst family's on the breadline have to pay tax on every penny they earn.

 

[RobinBHM]

Exactly, why should someone earning huge sums of money be able to move money to the Caymen islands to avoid paying tax on money that was made in the UK whilst family's on the breadline have to pay tax on every penny they earn.

globalisation has made it easy to move money around to sit in low tax jurisdictions

The problem is there is little UK can do without global cooperation, which is not going to be forthcoming as the digital giants have a huge amount of leverage

there has been talk of a digital tax to even up the unfair advantage online suppliers have over the high street.........but amazon etc would block it

 

[Rodpr]

If I am clever enough to find ways to accumulate more than my share of wealth (my gains are other people's losses) why shouldn't I also be allowed to hold on to a higher proportion of 'my' wealth. How else can I ensure that my children inherit the advantages I have enjoyed, giving them a head start in finding ways to grab more than their share of wealth?

 

[Terry - Somerset]

Debates over avoidance and evasion, and the distribution of wealth and income, are confused.

Highly paid "captains of industry" evidence unjust inequalities. Top sports and media folk who earn similarly are often just respected for their talent. The former can create jobs and wealth, the latter kick a football and twang a few strings. Who if successful can contribute most to society?

Their income is a function of economics. Morality has little influence. The failure of the "captain" is often met by contempt and anger. The failure of a mega cost footballer who fails to score is met with a wry smile and sometimes sympathy. Makes little objective sense!!

In terms of moral behaviours the committed underpaid care worker has a far greater claim than either of the above - but a reality of little or no economic power.

The deadly sins in Roman Catholic theology includes envy, greed, gluttony, and sloth. It is these "sins" which drive those who are able to seek to protect their wealth and income through tax avoidance and tax havens.

It is merely basic human behaviour and economics in action. Those critical may be largely driven by envy - I do not believe that most if they had the resources would behave materially differently.

 

[Jacob]

If I am clever enough to find ways to accumulate more than my share of wealth (my gains are other people's losses) why shouldn't I also be allowed to hold on to a higher proportion of 'my' wealth. How else can I ensure that my children inherit the advantages I have enjoyed, giving them a head start in finding ways to grab more than their share of wealth?

Good question!
Because other people need houses (and everything else) too.
In any case most wealth is inherited rather than the result of any great personal achievement. For example all the alumni of our posh private schools have inherited wealth behind them (except for the occasional scholarships).
Also even "earned" entrepreneurial wealth tends to be by virtue of merely owning something and extracting rent, whether its land and buildings or the wider schedule of Rentier Capitalism

 

[throbscottle]

and what was in ruins is now sort of proped up. Best thing is to enjoy your woodworking

Expect propane sales to increase!

 

[DrPhill]

Its funny... no one ever asks... what legitimate place do tax havens and secrecy jurisdictions have in a modern democracy?

AFAIK there is no legitimate purpose.

You're either avoiding tax or hiding the proceeds of crime.

Or both.

And yet... everyone just accepts the existence of such places without question.

There seems no impediment to simply requiring all such UK territories to conform to normal UK reporting law.

People will say... if we ban it, it'll just go elsewhere.

Not so fast Mr. Bond.

The big attraction to UK tax havens is the rule of law. UK Law.

Are you going to put your ill gottens someplace that could have a coup tomorrow?

Ask the Medellin cartel what happened to their money in Panama.

And 40% of money passing through tax havens goes through the City of London. Don't expect the UK government to do much about money laundering in the near future.

 

[Chris152]

globalisation has made it easy to move money around to sit in low tax jurisdiction

The problem is there is little UK can do without global cooperation

I watched this a while ago, it's pretty clear Britain would be at the back of the queue if it came to challenging that system.



(Don't know how I've split that quote in two, Robin )

eta - it's on Netflix too.

 

[Jacob]

And 40% of money passing through tax havens goes through the City of London. Don't expect the UK government to do much about money laundering in the near future.

Russian money too https://www.chathamhouse.org/2021/12/uks-kleptocracy-problem/03-global-money-laundering-capital

 

[Terry - Somerset]

Confidentiality is a basic right.

For a whole host of reasons you may not want your neighbour to know how much you earn, what religion you follow, of which masonic lodge you are a member, how you voted in the last election, your medical history, how much tax you paid etc etc.

That places exist to provide confidentiality in financial matters is entirely predictable. A wrong defined by one nation may be entirely acceptable in another. So which legislation should "tax havens" apply when they have the legal right to apply the rules they choose.

Get real - the UK is a beneficiary of tax havens, attracting those who desire confidentiality and those seeking to hide the unacceptable. If the UK did not provide political legitimacy for tax havens the practice won't stop - it will simply go elsewhere.

 

[Jacob]

Confidentiality is a basic right.

Amazing how people line up to defend and find excuses for the mega rich!

For a whole host of reasons you may not want your neighbour to know how much you earn, what religion you follow, of which masonic lodge you are a member, how you voted in the last election, your medical history, how much tax you paid etc etc.

Also a whole host of reasons why we need to know some of these things, but not necessarily all of them.

 

[John Brown]

Confidentiality is a basic right.

For a whole host of reasons you may not want your neighbour to know how much you earn, what religion you follow, of which masonic lodge you are a member, how you voted in the last election, your medical history, how much tax you paid etc etc.

That places exist to provide confidentiality in financial matters is entirely predictable. A wrong defined by one nation may be entirely acceptable in another. So which legislation should "tax havens" apply when they have the legal right to apply the rules they choose.

Get real - the UK is a beneficiary of tax havens, attracting those who desire confidentiality and those seeking to hide the unacceptable. If the UK did not provide political legitimacy for tax havens the practice won't stop - it will simply go elsewhere.

So let's invite all the drug barons to live in London too.
What a silly argument, in my opinion.

 

[Jacob]

So let's invite all the drug barons to live in London too.
.....

And put Russian oligarchs with KGB connections in the H of Lords and allow them to control items of UK main stream media!