Jump to Navigation
Home

Main menu

  • Home
  • News
  • Markets Map
  • Sentiments
  • Topics
  • Data
  • Comments
  • Images
  • Blog
  • About

Secondary menu

  • Latest News
  • Top Rated
  • Most Popular
  • Archive
  • Discussions
  • Friday Night Music
  • Student suspended over Twitter #tag
  • Jack Lew's Triple Whammy - IRS Ignorance, Corzine...
  • Will grandkids be fighting 'forever war'?
  • Apple's iOS 7: Black, white, flat?
  • New book is a fuddle-duddle-seeking missile aimed at...
  • China plans urbanization steps
  • China vows more liberalized interest rates
  • This is best time to buy coal assets: C S Verma
  • Guideline issued to deepen reform

    Tax-dodging: the left's problem

    Wed, 06/20/2012 - 06:43 EDT - Stumbling and Mumbling
    • Comments

    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.

    • Original article
    • Login or register to post comments

    Related

    • Budget 2013: tax avoidance and evasion targeted by George Osborne

    • Someone tell David Cameron that tax avoidance starts at home | Richard Murphy

    • Cameron refuses to say if he will quiz Google boss Eric Schmidt over tax

    • Margaret Hodge: tax avoidance costs the Treasury £5bn a year

    • Britain is still a world-beater in one industry – tax avoidance | Larry Elliott

    • Judgment expected on government's unpaid work schemes

    • Fiscal Slope Negotiations in the Context of Current Expenditures and Current Receipts

      The latter is stabilizing at extremely low levels. To place matters in perspective, note that even before 2008, tax revenues were low by historical standards. That was due to tax reductions passed in 2001 and 2003 (EGTRRA and JGTRRA), which helped overheat the economy in 2006-07.

    • Don't tax the rich

      The intelligent question posed by Saturday’s march is: what alternative is there to Osborne’s spending cuts? There’s one popular answer here that I’m not happy with - that we should tax the rich. UKUncut says: Rich corporations and individuals collectively get away with dodging £95bn every single year…collecting the tax dodged by the super-rich would render the vast majority of the government’s spending cuts unnecessary.

    • Enter the consumption tax

      AMERICA is in desperate need of tax reform. It needs more revenue to close budget gaps, fund social programmes, and make needed investments, but the current tax system is so complex and riddled with loopholes that efforts to boost revenues are economically costly and lead to lots of tax dodging. Economists often recommend scrapping the income tax system entirely, or shrinking its role, and replacing it with a progressive consumption tax, which is more efficient. It's a good idea, and one that's worked in other rich countries.

    • @Steve Horwitz, Larry White and George Selgin: What is Wrong With This Proposal for Bank Reform?

      |Peter Boettke| Toby Baxendale and the folks at the Cobden Centre have been working on various banking proposals that would demand that banking enterprises operate under the ordinary rules of property, contract and commerce.  Banks, in other words, would have no special privileges provide by law or politics.

    Latest

    New book is a fuddle-duddle-seeking missile aimed at shattering the enduring Trudeau myth
    New book is a fuddle-duddle-seeking missile aimed...
    Fluoride increasingly removed from water supply despite lack of evidence it is harmful
    Fluoride increasingly removed from water supply...

    User login

    • Create new account
    • Request new password
    • Click on the icon to sign in with your social network login or enter your Bullfax.com login

    Our Blog

    • Tata Steel, ECB, China’s car market and European Corporate Tax in Our News for Today 05/24/2013
    • Pandora: the charm might fade away
    • Japanese Market, Indian Rupee, China’s Stocks and Oil Prices in Our Daily Round-Up for 05/23/2013

    Markets Map

    Markets Map

    Follow Us

    Follow Us on Facebook, Twitter, Google Plus and RSS LinkedIn Facebook Twitter Google Plus RSS
    S&P 500: 1649.60 -0.06% FTSE: 6654.34 -0.64% Nikk.: 14612.45 0.88% DAX: 8305.32 -0.56% HSI: 22618.67 -0.23% FX: EUR/GBP: 1.1694 USD/EUR: 1.2935 JPY/USD: 101.175 Commodities: Gold: 1386.60

    Bullfax.com - Market News & Analysis 2008-2011
    Contact Us | About Us | Terms & Conditions

    Follow Us on Facebook, Twitter, Google Plus and RSS LinkedIn Facebook Twitter Google Plus RSS .

    Secondary menu

    • Latest News
    • Top Rated
    • Most Popular
    • Archive
    • Discussions