Coalition to Launch TAX Evasion Clampdown

[Greybeard]

It is not as simple as simply saying that there is a problem with the legislation we need to close the loopholes. They have been doing that and everytime the Accountants and lawyers find another one.

 

The simple solution is to create a legal duty for Tax Compliance and to crack down on tax havens.

 

Beg to differ. It is simply a matter of re-writing the regulations and making them watertight but it's unlikely to happen because the Tories depend heavily for their funding on beneficiaries of the current situation.

 

You'll never find avarice and ethical obligation in bed together and making it illegal to use legal technicalities will just confuse the judiciary

[Tradescanthia]

Just more coalition crap, in one ear out the other, filed under bull sh*t.

[L00b]

You are making the false assumption that everyone who is poor, is doing work on the side - some do but the majority of people I've known, don't.

No. Only that work on the side for cash in hand is more widespread at the lower end of the wealth spectrum. Understandably so.

When I refer to poor, I don't mean only those on benefits

When I refer to poor in the post you quoted, I don't mean all of them, and I certainly don't limit it to people on benefits.

 

I too have family members in the same situation.

[L00b]

Is this a new technique of debate? Ignore the points I make and repeatedly argue against something I haven't said

 

What I have been saying is that Tax Avoidance arises from the exploitation of loopholes.

Not at all, and that is well understood.

 

Can you point to me where I have said Tax Avoidance is illegal?

Can you point to me where I said that you said Tax Avoidance is illegal?

 

What I have said is that loopholes have not been solely "unintentionally created through the application of a combination of Laws by clever tax avoidance lawyers to exploit the unintentional consequences of the way those laws combine", far from it.

 

A great many more tax loopholes (so to call them: they're usually badged 'incentives' but work just the same) have been created to foster investment, employment, savings, etc. The State gives rewards to investors (otherwise they just go to whichever other State gives them rewards...or better ones - that's not a new phenomenon, it's been the case for decades), investors invest (R&D, jobs, etc.) and reap the rewards (better RoI through tax savings).

 

The alternative is simple: pull the rewards (loopholes-incentives), but don't get the investment (a better return for the same investment can be had in France, Germany, Ireland,...China, Argentina, etc, etc.). It's a logic (common sense, really) verifiable thousands of times over across Europe and the US in the past 30 years.

 

Take an even simpler example: do you have a tax-free ISA? Is this not a loophole? Should people not be made to pay capital gains tax on the meagre interest? Will people still be incentivised to save in ISAs if the tax-free element is removed?

 

Note that's not saying loopholes shouldn't be closed (I'm all for simplification), so long as the inward investment effect is preserved (through an appropriately attractive rate of taxation). This is e.g. what Ireland did in the late 80s/early 90s, and which led directly to the 'Celtic Tiger' phenomenon.

 

And that by making it a public duty to pay not the minimum amount of tax but to make the obligation to pay the right and appropriate amount of tax, Tax avoidance schemes involving the creation of artificial businesses making unnecessary transactions purely for the purpose of avoiding tax would then become illegal and rightly so because such activities are clearly anti-social and unethical.

And what I said is that this (pipedream) will not happen unless the UK Tax Laws, complex-extensive-interwoven as they are (the root cause of the problem), are re-written from the ground up.

 

Promulgation of this 'public duty' you suggest will not cancel out precedent legislation and precedent case law (unless the first are repealed and the second is overturned piecemeal by the CA or higher), and will simply further enrich tax/legal practitioners who will be tasked and paid to try and revoke such new legislation...or -as usual- introduce 'exceptions'. And round and round we go.

 

Until then, you can argue until you're blue in the face, ain't going to make one blind bit of difference to the situation. And the politicos know this all too well, have done for decades.

[milquetoast1]

Well said L00b.

 

[Hairyloon]

There does seem to be a weird misapprehension that people with money have a big vault where they spend their days counting it, throwing it in the air, using it for toilet paper and having a

while quackling manically.

 

They do the same as everyone else - they go out and put it in other peoples pockets.

Or they use it to buy up loads of property, which helps put the prices and the rents up.

[Wildcat]

Beg to differ. It is simply a matter of re-writing the regulations and making them watertight but it's unlikely to happen because the Tories depend heavily for their funding on beneficiaries of the current situation.

 

You'll never find avarice and ethical obligation in bed together and making it illegal to use legal technicalities will just confuse the judiciary

 

That's true for some of the big multi-national accountancy firms but PWC and KPMG, spread their donations more widely.

 

http://www.taxresearch.org.uk/Blog/2010/08/19/who-did-the-big-4-fund-before-the-general-election/

[Wildcat]

Not at all, and that is well understood.

 

Can you point to me where I said that you said Tax Avoidance is illegal?

 

What I have said is that loopholes have not been solely "unintentionally created through the application of a combination of Laws by clever tax avoidance lawyers to exploit the unintentional consequences of the way those laws combine", far from it.

 

A great many more tax loopholes (so to call them: they're usually badged 'incentives' but work just the same) have been created to foster investment, employment, savings, etc. The State gives rewards to investors (otherwise they just go to whichever other State gives them rewards...or better ones - that's not a new phenomenon, it's been the case for decades), investors invest (R&D, jobs, etc.) and reap the rewards (better RoI through tax savings).

 

The alternative is simple: pull the rewards (loopholes-incentives), but don't get the investment (a better return for the same investment can be had in France, Germany, Ireland,...China, Argentina, etc, etc.). It's a logic (common sense, really) verifiable thousands of times over across Europe and the US in the past 30 years.

 

Take an even simpler example: do you have a tax-free ISA? Is this not a loophole? Should people not be made to pay capital gains tax on the meagre interest? Will people still be incentivised to save in ISAs if the tax-free element is removed?

 

Note that's not saying loopholes shouldn't be closed (I'm all for simplification), so long as the inward investment effect is preserved (through an appropriately attractive rate of taxation). This is e.g. what Ireland did in the late 80s/early 90s, and which led directly to the 'Celtic Tiger' phenomenon.

 

And what I said is that this (pipedream) will not happen unless the UK Tax Laws, complex-extensive-interwoven as they are (the root cause of the problem), are re-written from the ground up.

 

Promulgation of this 'public duty' you suggest will not cancel out precedent legislation and precedent case law (unless the first are repealed and the second is overturned piecemeal by the CA or higher), and will simply further enrich tax/legal practitioners who will be tasked and paid to try and revoke such new legislation...or -as usual- introduce 'exceptions'. And round and round we go.

 

Until then, you can argue until you're blue in the face, ain't going to make one blind bit of difference to the situation. And the politicos know this all too well, have done for decades.

 

Since when have ISA's been a loophole? They are an intentional consequence of legislation... not a loophole at all.

 

This definition might help you:

 

Tax avoidance

Tax avoidance is seeking to minimise a tax bill without deliberate deception (which would be tax evasion) but contrary to the spirit of the law. It therefore involves the exploitation of loopholes and gaps in tax and other legislation in ways not anticipated by the law. Those loopholes may be in domestic tax law alone, but they may also be between domestic tax law and company law or between domestic tax law and accounting regulations, for example. The process can also seek to exploit gaps that exist between domestic tax law and the law of other countries when undertaking international transactions.

The tax avoider faces uncertainty when pursuing their activities. That uncertainty focuses mainly on their not really knowing the true meaning of the laws they seek to exploit and taking the chance that either a) they may not be discovered to be tax avoiding or b) that if they are the interpretation placed on the law that they seek to exploit is favourable to them. Their risk of penalties arising as a result of their actions depends upon what the outcome of these risky situations might be.

 

http://www.taxresearch.org.uk/Documents/TaxLanguage.pdf

 

Also since when has case law ever superseded primary legislation?

 

Your arguments rely on a different definition of loophole and tax avoidance to their common usage and a misunderstanding about how the law works.

[L00b]

This definition might help you:

It doesn't, really, since it is one (favouring your stance, of course) amongst a vast number of definitions from other specialist sources, generally neutral (which I subscribe more readily to, as less biased): "making full use of reliefs and exemptions to ensure as little tax as possible is paid" (e.g.) or "the legal exploitation of the tax rules to minimize tax payments" (e.g.) or "the minimization of tax liability by lawful methods" (e.g.)

Also since when has case law ever superseded primary legislation?

Where have I suggested -never mind posted- that (this is the second time you have placed words in my mouth, I note you omitted to reply to my earlier invitation).

Your arguments rely on a different definition of loophole and tax avoidance to their common usage and a misunderstanding about how the law works.

Of course, Wildcat, of course.

[Wildcat]

It doesn't, really, since it is one (favouring your stance, of course) amongst a vast number of definitions from other specialist sources, generally neutral (which I subscribe more readily to, as less biased): "making full use of reliefs and exemptions to ensure as little tax as possible is paid" (e.g.) or "the legal exploitation of the tax rules to minimize tax payments" (e.g.) or "the minimization of tax liability by lawful methods" (e.g.)

 

It is not bias to be using the definition used by those advancing an argument... It is the only way to understand what they are saying..

 

Where have I suggested -never mind posted- that (this is the second time you have placed words in my mouth, I note you omitted to reply to my earlier invitation).

Of course, Wildcat, of course.

 

In the post I quoted, you said this....

 

Promulgation of this 'public duty' you suggest will not cancel out precedent legislation and precedent case law (unless the first are repealed and the second is overturned piecemeal by the CA or higher), and will simply further enrich tax/legal practitioners who will be tasked and paid to try and revoke such new legislation...or -as usual- introduce 'exceptions'. And round and round we go.

 

 

To which I responded you are wrong. Case Law and precedent do not supersede primary legislation. Your argument is misconceived and wrong.