Member Since: 17th Nov 2011
19th Sep 2019
I certainly think that anyone campaigning for more tax transparency and 'tax justice' should be prepared to publish their own personal tax returns.
It's a matter of public record that tax campaigner Richard Murphy has frequently been challenged to publish his own personal tax returns and has repeatedly refused to do so.
Has he got anything to hide? I guess we will never know.
16th Sep 2019
I think a lot of this has to do with the current atmosphere around tax avoidance/evasion.
Tax Justice Warriors from the left have created the impression that it's a lawless tax country where evil tax avoiders are running rings from a hapless HMRC and that there are countless billions in tax just lying around waiting to be taxed if only the government would pass a few new simple laws.
This impression seems to have been accepted without question by the public and has resulted in the government desperately wanting to be seen to be doing something. The results are endless initiatives and campaigns and law changes that resemble giant pile-drivers being used to crack the smallest of nuts.
I can't help think that the accountancy bodies ought to be doing something. Every time some ridiculous story enters the media about the tax gap being £120bn or Amazon avoiding tax by stuffing cash in the bodies of freshly slaughtered baby seals then the accountancy profession ought to be at least issuing a press release setting out the truth.
12th Aug 2019
“The laffer curve simply doesn’t work."
Showing that Murphy doesn't understand the Laffer curve or is deliberately misrepresenting it.
Remember Laffer never said cutting tax always results in more tax being paid. He said there was an optimum rate. Saying that there isn't an optimum rate is a bit like saying 'gravity' doesn't work
"There’s no relationship between the profit motive and tax."
Would anyone out there go to work tomorrow if tax rates on the day's work were 100%? So of course there is.
If tax doesn't influence behaviour, why are the likes of Lewis Hamilton currently living in Switzerland? Why are super-rich non-Doms departing the UK?
"In Kansas, we saw this clearly. Businesses received a tax cut but the economy flagged."
Without a thorough review of what happened, it's not possible to say why this happened. The briefest of reviews of what happened shows that the policy was half-hearted, with no spending cuts and no broadening of the tax base lower down and happened at a time when federal support was being withdrawn and the economy was still recovering from the crash of 2008.
That's the problem with the arguments put forward by the left in general. You can point out any number of failed high tax and spend economies and it's always something else that caused the problem. But when something like Kansas happens it's 'proof' that tax cuts are bad.
“Those on high earnings aren’t necessarily the most productive members of society,”
An easy assertion to make and one that fits the "it's not fair" mentality of the left. If someone earns more than you it must be because they've cheated, or been lucky or generally that it's not fair. That being so, lets tax the b*ggers in the name of fairness.
12th Aug 2019
"...how long until state pension gets means tested etc."
I can see that coming.
The state second pension and SERPS went by the wayside. The idea that someone contributing hugely more income tax and NIC might reasonably expect a higher state pension was deemed 'unfair'.
So now it's possible to pay £0 tax and NIC over a whole career and still get a full state pension.
Pension costs will continue to rise and the current direction is that more and more people will pay no tax at all. Those increased costs will need to be met from somewhere and another attack on 'the rich' will be justified, once again, in the interests of 'fairness'.
Robbing Peter to pay Paul always goes down well with Paul and there are many more Pauls than Peters.
What happens, though, when there aren't any more Peters left?
12th Aug 2019
What 'gap' would be shortened?
And why does it have to be shortened?
To be in the top 1% of income earners you need earn £162k p.a. before tax. How many staff are you expecting they employ? And on what salaries?
Many on such salaries don't own a business. They are employed themselves. I don't suppose their employers are paying those salaries out of the goodness of their hearts. Those salaries are being earned.
If you're suggesting all salaries be reduced so that 'inequality' is reduced, the question has to be why? Should those on £162k have their salaries reduced by 50% so that the £81k be redistributed among the other 99%?
On £162k a year you're likely paying tax/NIC of £65k. Isn't that enough of a redistribution?
12th Aug 2019
"I have to ask the question – is this blind-eye approach a tax avoiders’ and tax evaders’ charter? If the government does not wish to close any further loopholes, many of which allow the richest in society on both corporate and personal levels to make hay while the sun shines, the tax take is going to go down at a time when we need it to bolster the flagging economy."
I'd expect such a comment from some of the more lurid and ill-informed ends of the media but not on here.
It's a gross caricature to suggest that the current tax system is like some lawless wild-west with evil rich companies and individuals running rings round a hapless taxman. The majority of the sensationalist media stories portray a tax system working how it's supposed to. Overseas companies don't pay tax here but the ignored flip-side is that UK companies don't pay tax in every country they sell to. Companies paying huge bonuses to staff will of course reduce their taxable profits but the ignored flip-side is those staff paying tax at higher rates.
Point this out to critics and there is just mumbling about unverified and unnamed cheating that "must be going on".
A scathing criticism of Richard Murphy's 2010 figure of a £120bn 'tax gap' (google House of Commons briefing paper 7948 and read p13 onward) pointed out that such gross distortions ran the risk of encouraging tax evasion. If everyone was 'at it' and 'getting away with it', why not join in?
Just as bad, a government running scared of a media constantly telling us that the rich pay nothing in tax and laugh maniacally at us as they do so is going to result in ill-thought out legislative attempts to be shown as acting tough.
If HMRC staff have low moral and are leaving, constantly saying that they're rubbish at collecting taxes is hardly going to help.
Is the tax system perfect? Of course not. Is it as hopeless as portrayed? nowhere near.
24th Jul 2019
Surely there's sixth misunderstanding? When IR35 was introduced, the regulatory impact assessment had predicted £220m extra NIC and £80m extra income tax PER YEAR.
A FOI request revealed that between 2002/03 and 2007/08 IR 35 had raised £9.2m, a little short of the £1.5bn expected.
Another example of the government misunderstanding tax/NIC and its impact.
And the probability is that HMG had spent the £1.5bn it anticipated getting.
No wonder they are changing the rules. I wonder how much they expect to raise this time.
24th Jul 2019
"...the man who seems to share so many attributes with the President of the United States, including attitudes to women and immigrants,"
I don't myself have insight into these attitudes. Other than lurid and sensationalist newspaper stories from antagonistic journalists, where did you gain yours?
"immigrants" Is that illegal or legal you are referring to? There's quite a bit of difference.
24th Jun 2019
That's not a valid comparison.
Investors in stocks and shares are not running a business.
A BTL landlord is.
Would you consider the deduction of interest paid on loan to buy a newsagents was a 'nice tax break' that should be removed?
24th Jun 2019
The problem with the "it serves BTL landlords right, I have no sympathy" is two fold.
Firstly, if these measures are being defended as a way of re-balancing the housing market, I doubt they will. They don't affect companies and they won't affect the very rich who can afford to buy without borrowing.
There will always be a need for rented accommodation. Students, those just starting out in work, those who just don't want to own a property. Who is to provide this? The state? I'm sure Jeremy Corbyn would say yes to this but The state wouldn't be my first choice for landlord.
Private rented accommodation only accounts for around 18% of the housing market so the driver on price is still mainly owner-occupiers. Has driving a percentage of the landlords out of the market had much effect on process? I haven't seen that yet. If all BTL landlords disappeared overnight, where would people who wanted to rent live?
As to the measure itself, any system that can produce a tax bill out of rent £12,000 - Mortgage interest £12,000 = £o profit (and theoretically a tax bill of up to £4,800) has to be flawed.
If penalising BTL landlords is the aim of the game, why not just confiscate the houses and be done with it.