I argued yesterday that the UK government really does not want to collect tax from fraudsters operating in the UK, and would rather create an environment where fraud is easy to undertake than one where regulation can be enforced.
I will be recording on this theme for the BBC today when discussing the UK’s failure to properly tariffs due on trade from China which is now resulting in a suggested fine of £1.7 billion from Europe. The suggestion made in that case is not that the UK made a mistake; it is that it simply could not be bothered to collect the tax owing.
And now Jolyon Maugham is bringing a case against Uber demanding a VAT receipt for a journey he made in a car provided by that company. He knows, of course, that he won’t get one. Uber claims it does not provide taxi services, saying its drivers do that and it is a mere booking agency. But that claim is inconsistent with the facts, which have been upheld because Uber drivers have been found to be employees in a tribunal hearing. At the heart of this case is a simple allegation, that HMRC has not collected a massive sum owing by Uber in VAT because it has failed to properly appraise the facts in this case.
Are these cases all coincidence, or is there a conspiracy going on here? I suggest the latter, although I am well aware of the reaction that this will give rise to. The opinion is based on the attitude of Tory MPs. I well remember Jacob Rees Mogg arguing against Michael Meacher in the House of Commons on one of the Private Member’s Bills I wrote for Michael. The aim of the Bill was to tackle tax evasion, which is money that is already due to HMRC. Rees Mogg’s argument against the bill was that it would result in more tax being paid and that was undesirable as a matter of absolute fact, so it must be opposed. I was shocked but in a moment realised the true agenda. Upholding the rule of law to collect tax legally due did not matter. There are instead those in the Conservative Party, from top to bottom, who are more than happy with tax abuse because it means there is less money for government and that means that austerity and the policies of intimidation against so many in society that flow from it can be justified.
It is the same attitude that means HMRC is more committed to cutting staff than collecting tax.
And the same policy that means HMRC will not properly estimate the tax gap.
And it explains why we have a General Anti-Abuse Rule for tax, because it is politically expedient to do so, but it has never been used.
Come to that, this may be why Google did not pay the Google tax.
And this is not some minor issue: this drives to the very heart of what our government is supposedly about. If, as seems likely to me, it is being run by those with an interest in favouring big business whilst offering a light touch on regulation to all-comers with the intention of making sure that only smaller tax payers are compliant whikst at the same time using a lack of revenues as justification for cuts in spending that cause untold hardship but which are in fact wholly unnecessary then this is itself a government fiunded on what can best be described as fraudulent misrepresentation of the true economic facts. It will take a lot to persuade me otherwise.