The Daily Mail has joined those giving advance publicity to the TUC report on tax planning and avoidance to be published on Friday. Ir says:
It estimates controversial 'non-domicile' rules allow them to avoid about £3.8billion of taxes.
and
About £3.2billion is lost from 'income shifting', typically putting money in a wife's name. Other loopholes and clever accounting make up the remaining £6billion.
So what did Mike Warburton have to say? This:
[M]any would simply leave Britain if they had to pay more tax.
It's time to change the record Mike. We've heard this response so often it has ceased to be credible: it's apparent they are not leaving.
And it's time Mike did something else: which is recognise that in practice those doing much of this are paying less tax then most in this country although they have the greatest capacity to pay. Brendan Barber of the TUC has said:
It looks like tax has become optional for a small group of the super-rich.
And the TUC point out:
[T]he biggest victims are those on the state pension, who could be given a 20 per cent increase with the revenue.
So why are you choosing to be on the side of abusers Mike? Can you provide an answer?
Hint: Don't try 'trickle down' as a partner at a Big 4 firm did at a recent event I attended because we all know wealth is 'trickling up' as the gap between richest and poorest is increasing.
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I am forced to conclude that you are not very bright, Mr Murphy.
The UK has generated ample evidence over the years that governments are much worse at spending money than individuals. Standards in education have fallen despite huge amounts of extra funds since 1997. Standards in the health service (or should that be illness service) have improved little, despite huge injections of cash since 1997. This demonstrates that increased Government spending does not lead to improved standards.
Wouldn’t it be great if commentators could remove the scales from their eyes and see that the thing that makes the difference is neither the TUC, nor Richard Murphy, nor Mike Warburton (though he talks more sense than the previous two together). It is rather the individual who gets up off his or her backside and creates wealth. On that wealth depends the employment of others, and on the backs of them sit the unions, the accounting profession and the government, amongst others. 40% of our GDP is spent by those muppets in power. Do you think we’re getting value for money? I don’t.
Reductions in tax rates have been shown to increase tax rates. It is therefore quite possible that the reverse is true. Wake up, Mr Murphy, and smell the coffee!
Dear Moderator
Proof-reading shows that the penultimate paragraph should read “Reductions in tax rates have been shown to increase the overall tax take.” If you could change the original comment accordingly, I would be grateful. Otherwise please edit this post.
on the other hand, Mr Furse, I am forced to conclude something quite different. Some reductions in tax rates may increase tax take, however any muppet can see that this cannot always be the case.
Your comment on individuals getting up off their backsides is just drivel. Presumably you imagine that a very small number of people in this country are doing worthwhile work and no doubt you include yourself in this number! You are evidently a sentimentalist. The reality is that the individuals are not like lone frontiersmen, they will all depend on others and they will depend on a highly developed society in which to realise their ambitions.
One thing of course that has not been mentioned is the role of modern communications. With the internet and video-conferencing, there is little reason why management and control over any organisation cannot be carried out from anywhere in the world. How many people, if faced with a choice of working (for the same take home pay) for 10 years in London or 2 in Switzerland, Cayman or Jersey, would choose the former?
Interesting times indeed.
Sentimental? Hardly! I’ve spent the last twenty-five years watching our education system slip further and further behind other countries, our life expectancy and cancer survival rates lag both the US and Sweden, our armed forces being asked to do more and more with less and less, our police forces becoming increasingly politicised, unelected political appointees dictating government policy to civil servants, the quiet introduction of more electronic surveillance than any other nation on Earth, the emasculation of parliament and (perhaps not unconnected) the majority of our politicians serving themselves rather than the electorate.
For the record, this probably isn’t the best forum for this discussion. But hey, James, you really ought to take stock of where we’re going and what we’re in danger of losing. But perhaps this is what your highly developed society entails. I wonder how many people really agree with what’s been done.
Michael
I’m not at all sure what benefit there is from saying I’m not very bright. Not agreeing with me does not mean I lack intelligence. It suggests we apply our intelligence in somewhat different ways with a different social compass. Call that the application of wisdom if you wish.
All I can say is that as someone who has headed a firm of accountants, a number of quite reasonable sized companies, has employed hundreds (probably thousands) of people, often in countries I have created or helped create – a track record as an entrepreneur as good as that of many in other words – I am very very aware that what you say is just wrong. nothing is more important than strong government, strong socials services, strong infrastructure and strong social services and healthcare to making good business
The relationship is a partnership.
Your simplistic approach is just that – simplistic. It’s also crude and horribly unwise for it would if followed through destroy the foundations of our wealth
Richard
You haven’t read what I wrote. I pointed out that lowering taxes had been proved to increase the gross tax take. That’s a fact. For you to deny this would suggest that you either don’t know or that you do, but choose to say otherwise.
I then suggested that the reverse was true. To decry someone who raises this point as being “simplistic”, to describe them as being “just wrong” is neither intelligent not wise.
Do you honestly assess our education service as strong? Our health service as strong? Our government as strong? How would you describe its industrial policy? Its trade policy? Strong is not a word I would use.
Why should more of the same result in a reversal of the parlous deterioration of most of our centrally funded services? The pit is bottomless – throwing in more money that we can’t afford would be more than foolish.
I don’t know what nature of accountancy practice you headed, but it is not beyond the bounds of possibility that your practice discussed tax reduction schemes with your corporate (and perhaps even private) clients. I am much amused by imagining the intellectual contortions that I would have to go through to square the dispensation of such advice (and profiting thereby) with the encouragement of others to pay more tax.
I wish you well. Should you be interested in learning a little more about the non-revolutionary non-apocalyptic alternatives to our current incompetent way of doing things, do please send me an e-mail – I provided the address when I registered.
Michael
I reviewed all the academic literature I could find of any credibility on the ‘Laffer curve’ effect you describe when writing for the ACCA on the now near forgotten flat tax issue a few years back
There is no proof for what you say
Sorry – it simply does not exist
Please stick to reliable research – not the output of American think tanks that no one listens to any more (thankfully)
As for your conjecture on my tax practice – I practiced tax compliance – seeking to pay the right amount of tax (but no more) in the right place at the right time where right means that the economic substance of the transactions undertaken coincides with the place and form in which they are reported for taxation purposes.
Richard