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Jeremy Corbyn for Accountants

16th Sep 2015
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The press has not painted Jeremy Corbyn in a favourable light but perhaps his advent may not be all bad for accountants?

Corbyn has found himself portrayed as a man of the left. Indeed detractors would probably suggest he is in a long line that includes not only Ramsay MacDonald and Harold Wilson but Lenin and Trotsky. In today’s bland political climate this makes him second cousin to Satan.

While most readers will probably take the view that an unknown (my spellchecker didn’t recognise the name), ageing left-winger could never become Prime Minister, they might pause for thought.

Only a few short weeks ago Corbyn was a backbencher whose chances of becoming Labour leader were equivalent to those of Namibia winning the Rugby World Cup.

It is also worth bearing in mind that in Greece Syriza, which was little more than a protest movement, is running the country.

On Saturday, the several hundred to one bet became reality, so it is time to take stock and see what it could mean for those in the profession.

According to the BBC website, “There would be an end to austerity, higher taxes for the rich and protection for people on welfare - and a new crackdown on tax avoidance and tax evasion, as well as "corporate welfare", tax breaks for companies”. He would also increase the rate of corporation tax and seek to recover £120 billion by attacking tax avoidance and evasion.

Beyond the tax platform, Mr Corbyn has plans to introduce a maximum wage for top executives.

Readers might well be shuddering at this point since Jeremy Corbyn does not immediately appear to be accountant-friendly.

On the downside, some of us could fall foul of the maximum wage, although how this would affect those in partnership is unclear. In the real world, this sounds like an impractical measure and in order to achieve the goal of attacking the “rich”, it would be more sensible for the man who could be the next Prime Minister to consider increasing the rates of income tax and/or National Insurance Contributions.

This column has taken up much space in considering the thorny debate of tax evasion and more particularly avoidance. The general consensus in the profession is that attacks on tax evasion are entirely acceptable, while tax avoidance remains legal.

The key here for any politician wishing to enter the fray is a need to change the law to make certain potentially murky arrangements taxable. Once that has been done nobody, not even lawyers or accountants, could object. That is the theory anyway.

An increase in corporation tax might be more controversial, since it would make the United Kingdom less competitive when compared with its international rivals. However, that appears to be more of a political issue than a decision that has bearing on our jobs as accountants.

Anyone reading thus far would probably feel that everything proposed by the new Labour leader is likely to be detrimental for those in the profession.

However, every cloud has a silver lining and those of us who offer advice in connection with the taxation of our clients might potentially welcome the arrival of Mr Corbyn.

If he gets into power and is able to implement some of these proposals, the immediate consequence will be higher taxes for the wealthy. Since they are the people that we represent and, even better, can afford to pay our (in their eyes) extortionate fees, come 2020 the accountancy profession could be rubbing its collective hands together in glee.

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By Luisa14
18th Sep 2015 13:41

I find your point of view pretty interesting. Have to say that I've never though about it that way. I'm doing a research job for Top Essay Writing and I would like to use your article as a source. I really enjoy working for the essay writing service but sometimes I lack some specific knowledge. You helped me a lot, many thanks!

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