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Top 1% of earners pay 30% of all income tax


Nagel

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But are still targeted by the government as they contribute to the tax gap

 

"Tax evasion and tax avoidance by businesses and individuals contribute to the tax gap, along with error, failure to take reasonable care, non-payment, legal interpretation, the hidden economy and criminal attacks on the tax system."

 

I know it's difficult for you because it involves attacking avoidance, which you seem to be a fan of.

 

And before you start, and for the fiftieth time, an ISA is NOT avoidance! :roll:

 

Mere semantics. If you are staying within the law then it's avoidance however it is done, and however HMRC dress it. If the Govt don't want you avoiding in such a fashion then they need to clarify the law.

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"Tax evasion and tax avoidance by businesses and individuals contribute to the tax gap, along with error, failure to take reasonable care, non-payment, legal interpretation, the hidden economy and criminal attacks on the tax system."
I don't disagree with the fundamental principle, but the above is a bit disingenuous:

 

Error is neither avoidance nor evasion

Failure to take reasonable care is [technically] evasion

Non-payment is evasion

Legal interpretation is avoidance (or evasion, once decided by a Court)

Hidden economy is evasion

Not sure what you mean by 'criminal attacks', but that clearly sounds like evasion

 

So, not quite 'along with', rather 'including'. Sounds like a typical Gvt worldly newsbite which means precisely not much, tbh.

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Mere semantics. If you are staying within the law then it's avoidance however it is done, and however HMRC dress it. If the Govt don't want you avoiding in such a fashion then they need to clarify the law.

They do, on a rolling basis.

 

One tax lawyer who specialises in avoidance was asked in select committee how many of his previous avoidance products were now illegal:

 

"All of them".

 

Tax avoidance is something you need to be wealthy enough to afford, in order to comply with the letter of the law, and completely ignore the spirit.

 

There is, as far as I can tell, a relatively straightforward solution:

 

Tax avoidance products should be taxed at 100% of the tax that has been avoided

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Making use of the currently, fairly higher allowances on capital expenditure is tax avoidance. The Government is trying to encourage businesses to invest by making these allowances higher, so the business owner doesn't pay as much tax. Should these "loopholes" be closed down and taxed at 100%? Or should we encourage busineses to invest?

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Thread derailed as usual into an age old forum cul-de-sac.

 

I was really interested in the reasons for the increase in tax revenue from the highest earning 1%, which still remains unexplained. Reasons for tax non-avoidance.

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Reasons for tax non-avoidance.

 

But you're asking for proof that the government have done something positive, and that not all rich people are evil-money-grabbers - I think that's against the rules for Sheffield Forum. Start moaning or GTFO ;)

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I was really interested in the reasons for the increase in tax revenue from the highest earning 1%, which still remains unexplained. Reasons for tax non-avoidance.
Are we sure yet that it is an actual increase in tax revenue, and not simply a statistical shift due to the remaining 99% paying proportionally less than before (for a level or even lesser total tax revenue)?
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Making use of the currently, fairly higher allowances on capital expenditure is tax avoidance. The Government is trying to encourage businesses to invest by making these allowances higher, so the business owner doesn't pay as much tax. Should these "loopholes" be closed down and taxed at 100%? Or should we encourage busineses to invest?

 

You don't have to be a finance wonk to know what the intent of most tax legislation is.

 

When the government make allowances and encourage you to use those allowances to reduce your tax bill, that is tax relief, and the intention of the tax legislation thus governning it.

 

Tax avoidance products typically involve "contrived, artificial transactions" that serve no purpose other than gaining a tax advantage. The intention of parliament is being thwarted in a technically legal way.

 

Tax relief != tax avoidance.

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Are we sure yet that it is an actual increase in tax revenue, and not simply a statistical shift due to the remaining 99% paying proportionally less than before (for a level or even lesser total tax revenue)?

 

Could be, I dunno.

 

That's why I put it up for discussion.

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