I tried to debate tax on the Stephen Nolan show this morning on BBC Northern Ireland.
My opponent was proud of paying no tax.
The result was not especially edifying, but this is it:
listen to ‘Is tax avoidance immoral? @RichardJMurphy and @CharlieSeaWolf battle it out’ on audioBoom
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Sorry Richard, I couldn’t listen to the whole programme even though I could have done so legally. It was just too horrible. Could you write some more about the general anti-avoidance law? This was the first time I have heard anybody say that tax-avoidance may be illegal (and I was very pleased to hear it).
Best regards
Unedifying as you say but reflects the view of so many in the City, the professions (sic), the top tiers of business and arguably the current government. A lively argument over dinner only last night with an old and respected friend and ex-PWC partner covered similar ground. With him retreating to the position that ethics and morality have no place in the debate and that (in this case) the accounting firms are acting amorally. Their only obligation being to interpret the law in the best interests of their (fee paying) clients.
Which also surfaced the point that (as I know from working at KPMG), the tax and advisory practice is a major revenue earner. Est revenue £600m last year. If I’m prepared as a business to pay say 5-10% of taxes saved as fees, that suggests £6-12bn of taxes avoided. Multiplied across the accounting firms, provides another indicator of the level of tax avoidance.
To your point Richard about the role of ethics and morality in interpreting the law; what we have, just as goes on in the investment banks, is people gaming the system. And just as in the City, I have often argued that there is a relationship between the level of regulation and legal frameworks, and the standards of ethics and morality. As ethics tend to zero, the required regulation tends to infinity… Apologies – I was an engineer/mathematician! Where ethical standards are high, and the organisations are driven by the wider interests of their customers and society, there is much less need for legal frameworks and regulation. People do not seek to game the system or more crudely, do not want to screw their customers and society. As a management consultant I’ve worked with both kinds of organisation, in different sectors.
So changing the law and it’s enforcement is vital, yes. But without a change in the ethics, morality and beliefs in these organisations, they will continue to game the system to the selfish advantage of themselves and their fee paying clients.
Agreed
Thanks
So the challenge, as yet not really addressed I fear, is how to reshape the ethics and vales of these organisations. Perhaps much of the City. Changing the law and regulations is not the answer as so many believe, although it is part of the answer. Adair Turner and others have speculated that nothing less than the removal of a generation of management may be needed.
Who is providing a lead and the best thinking on this front?
A raft of people
Start with the tax justice movement
And the New Economics Foundation
And the cooperative movement
And …. Look, the problem is not that the thinking is not there. It is. The problem is it’s not allowed to be heard
And democracy has to change that
Including in places like the BBC where neoliberalism has taken over