Tax-dodging: the left's problem
Lefties love talking about tax dodging, perhaps because it's an easy way of claiming moral superiority. But in fact, it raises an embarrassing question for them, namely: why do legal tax loopholes persist?
There's nothing new about such schemes. Back in 1996, Peter Mandelson wrote:
The present tax system...permits a proliferation of tax shelters and avoidance loopholes that are not in practice available to the hard-working majority. Tax reform is about guaranteeing a fair deal for all types of saver and doing away with the vast array of fiscal privileges that in practice are accessible only to a minority. (The Blair Revolution p23, 108)
Mandelson is not renowned for his left extremism, and yet the last Labour government failed to meet even his demands for the closing of legal fiddles.
There are two possible reasons why it didn't.
One is a lack of expertise. The state just lacks the ability to draft legislation that permanently closes such wheezes. As Roy Lyness, the manager of Jimmy Carr's tax dodge said:
It's a game of cat and mouse...The Revenue closes one scheme, we find another way round it...That's all we do with tax avoidance. The revenue puts a block in, we just go round the block.
The other possibility is a lack of desire. The lobbying power of the rich is so great that the loopholes stay open; the demand that the government encourage the film industry is a favourite cover for such special pleading.
Now, whichever of these explanations is correct, there's a depressing message for the left. It's that the state lacks either the will or the ability to achieve even basic principles of justice. Marx was, to a large extent, right; the state is the instrument for advancing the interests of the rich, not the cause of justice. This in turn implies that merely having a large parliamentary majority is nothing like sufficient for achieving leftist ideals.
So, what are the alternatives?
The Marxian answer is that the left must control not only parliament but the means of production as well, which would put the rich under the control of the majority.
Another possiblity, suggested by David Aaronovitch in the Times, is to create a stronger social norm in favour of paying taxes - to increase tax morale.
The latter might (just, and arguably) be more desireable than the former - but I'm not at all sure whether it's much more feasible.