Friday, 22 June 2012

Have you noticed ...

... the furore concerning the tax avoidance by those who we might call friend, those we might call neighbour, those that do not pay their taxes in full .....

.... ah but we pay too much some write to The Times, "... there is no moral case for a resident of this country to be forced to pay wildly more than his neighbour for identical state services", so says Mr. Wilkins of East Sussex.

Not quite true Mr Wilkins, your assertion assumes that the majority of people when they work become company resources rather than stakeholders, your assertion rests on the foundation that many people can be paid below the minimum needed to survive who are then given a subsidy by other people throgh tax credits.

The reality is closer to The Times leader ...

A Serious Matter

Jimmy Carr has realised that tax is no joke. The comedian’s apology and his decision to abandon the tax avoidance scheme exposed by this newspaper are welcome. In deciding to invest in the K2 scheme, Carr did indeed make what he has called “a terrible error of judgment”. For while this scheme may be legal, it is a blatant example of aggressive tax avoidance that most reasonable people would have felt was neither in the spirit of the law nor fair to the taxpaying fans from whom he earns his living.

The Times champions success and wealth creation. We believe that income tax rates are too high and that they stifle enterprise, especially when combined with national insurance contributions. It is understandable that people take an interest in legal ways to reduce the burden. But there is a world of difference between protecting savings from tax in an ISA, for example, as millions of people do, and investing in tortuous schemes involving offshore trusts in order to reduce tax payments to minuscule levels.

The day before he repented, Carr told a gig: “I pay what I have to, and not a penny more.” This was not something to be proud of, given that this meant reducing his tax rate to considerably below that of his audience.

All the schemes that The Times has exposed so far are legal. Yet some go far beyond the intent of the reliefs or allowances that they seek to exploit. This is the kind of “aggressive” tax avoidance that the Chancellor has called morally repugnant. There is no absolute definition of what constitutes “aggressive”, but Graham Aaronson, QC, a tax expert, has suggested a test of double-reasonableness. An aggressive scheme is one that a reasonable person would not consider reasonable.

Synthetic schemes that involve no real assets, but funnel money on and offshore, such as K2 and some employee benefit trusts, are unacceptable under this definition. But many tax avoidance schemes are asset-based, such as the Icebreaker partnerships investigated by The Times. These are ostensibly designed to funnel money into the creative industries; and the Icebreaker partnerships claim that they do spend about 10 per cent of the total investment on musicians and other artists.

While that seems low — and our investigations expose partnerships that HM Revenue & Customs believe have become tax avoidance vehicles with a commercial veneer, instead of genuine creative investments that can also earn tax relief — they pose a bigger challenge in separating worthwhile investment and egregious abuse.

Today The Times investigates a tax shelter that is based on a statutory scheme set up to give tax relief for pharmaceutical royalties. But it has been ramped up to the point where it is now worth more than double what an investor puts in.

Many tax avoidance schemes stretch credibility. They are also remarkably widespread. Our continuing investigations demonstrate that tax avoidance is not just confined to the very rich, to celebrities or to the South. It involves bakers and dentists as well as singers and comedians.

A culture has grown up that is in part a revolt against high taxes, and in part pure opportunism by greedy people who do not want to miss out. The more people who stand up against this culture, against the attitude that says that it is grown-up and clever to “get away with it”, the better. But government must also radically simplify the system. The most egregious ruses are built on deferrals, relief's and allowances created in good faith by ministers.

The issue is not just about Carr. He has climbed down, and quickly, from K2. That is to his credit. But he was one of more than 1,000 people in that scheme, and there are thousands more in other schemes designed to ensure that people pay less than their fair share.
The answer to the whole issue is quite simple, If you make your money in the UK then you should pay your taxes here, if your assets are located here then they should be taxed here ........... simple.

If you live elsewhere in the world that's entirely up to you, if you wish to hold your bank accounts elsewhere that's up to you, but if you wish to do business here in the UK then pay your taxes in full to our treasury ........... simple, anything less is theft.

.......... unfortunately for the peoples of Britain we have no politician with the requisite strength to put in place the very simple laws needed.

..........  our Government should be afraid that another Kentish John Ball might be about to lead a 21st century Peasants’ Revolt ....

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