Wednesday 27 February 2013

Mob rule

The proposal put forward last week by the Public Accounts Committee that those who sell aggressive tax avoidance schemes should be ‘named and shamed’ is likely to prove a popular one.  Few of us have much time for those who seek to avoid ‘paying their dues’.  But although I have as little sympathy for them as do most other people, I’m still more than a little uneasy about the idea of officially-backed public vilification.
Like it or not (and I don’t), the reason that there are people prepared to develop and sell such schemes is that there are others who are keen to buy them.  In this case, the sins of the purchasers are at least as heinous as the sins of the sellers.  Besides, none of them are actually doing anything illegal; they are merely using an excessively convoluted tax code to their own advantage.  That may be immoral, in the eyes of many; but it ain’t illegal.
But who sets the standards for morality?  It’s clear that parliament sets the standards for legality (leaving aside the question of being able to abide by those standards themselves!), and for those things declared illegal, the full force of the law can be used against perpetrators.  Public opprobrium is simply a bonus in those cases.
But once we start giving the green light for the media and others to start the opprobrium where there is no illegality, merely a transgression against an unwritten and largely arbitrary moral code, where does it end?  It’s a form of mob rule; and officially sanctioning it makes it uncomfortably similar to some aspects of the former totalitarian states.
Rather than encouraging a process which they are unlikely to be able to control once unleashed, our elected representatives would be more gainfully employed re-writing – and simplifying – the tax code; removing all the little complexities which create the opportunities to avoid tax.  Making tax avoidance schemes illegal, and dealing with the perpetrators under the law, might not be so populist in the short term, but it’s surely more effective in the long term.


Anonymous said...

Pontificating about morality is always a sticky wicket for politicians.

Spirit of BME said...

As I have said before – I just love tax avoidance schemes – and fully partake in Duty Free goods, ISA`s and paying the Plummer in cash so he can thrive in his job.
You are right the complexity of the tax laws which have been added on and amended for short term political advantages is whacky at best, that is why a flat tax is the only answer and more importantly the cheapest to collect – sorry Accountants, Tax Lawyers, Tax advisors and an army of civil servants, but you will be “spending more time with your families “and saving us all a fortune.