The Jersey Evening Press notes:
ISLANDERS are being encouraged to shop benefit cheats through a new confidential phone line and website.
Now suppose they put a bit more effort into tackling tax cheats instead?
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I feel so sorry for the people of Jersey – not the financial cheats who use it, or the corrupted and overawed bureaucrats who govern it, but the ordinary people for whom it is, or once was, home. They’ve been despised and shafted and sold, and now they face this humiliation, too! What a squalid, depressing island. Makes you think of Augean stables.
@ Skylarksara
An opinion which is shared by many.
It is not the people of Jersey (and Guernsey and the Isle of Sham) who have created the mess, but greedy, selfish governments catering for a relatively few, equally greedy selfish people/organisations.
First thought is it’s considerably easier for ordinary people to spot a neighbour who’s working and possibly claiming illegal benefits than it is for an ordinary person to ‘spot’ high-level abuse of the corporate tax system (not in your case perhaps but certainly for most).
Second thought is the need to define your terms. Claiming a benefit to which you’re not entitled is breaking the law, tax avoidance is not. There’s a powerful case (which you articulate well) to change those laws to make currently legal activities illegal but until that happens a phone line to point out such activity is rather silly.
@Liam Murray
In Jersey a great many people know who is on the border line of avoiding and evading
For example, not a single bank reports people for choosing to have the witholding option under the European Union Savings Tax Directive and yet the only reason for doing so in most cases must be evasion
They only have to be suspicious to report. You can’t not be suspicious of those refusing to allow data to go to their own government about their income
But no bank reports
Why is that?
Want to suggest an answer?
Hang on.
The withholding tax option was part of a 7yr agreement between dissenting countries & the EU and includes the payment of a 20% tax. The suggestion that “the only reason for doing so in most cases must be evasion” is a leap too far. Were I to phone a benefit cheat helpline with suspicions grounded in nothing other than the ethnicity of the target I’d expect short thrift – likewise with your implication that the only reason to withhold information is deceipt.
“You can’t not be suspicious of those refusing to allow data to go to their own government about their income”
You can’t perhaps but I can. I regularly refuse to confirm my childs ethnicity, religion & various other silly questions asked by his school because I’m of the view that it’s none of their business. If I think they should know I’ll tell them.
I don’t expect agreement here because I think we have a failry fundamental & philosophical disagreement. But even putting that aside I still don’t think you’ve answered the main point – a phone line on tax evasion might be legit, one on tax avoidance not remotely.
@Liam Murray
Oh come on – you forget the fact that legally money laundering officers need only have suspicion to require them, at risk of criminal penalty if they do not, to report
But they don’t
And they must have suspicion
I’ve asked hundreds of people this question
All think always suspicion must exist
But not in Jersey
Why are your MLOs from a non-human gene pool when it comes to suspicion?
But it has to be suspicion of evasion, not avoidance.
And the bar for that suspicion should be considerably higher than the bar for suspicion around benefit fraud – if only because those engaged in the latter are unlikely to have engaged expensive legal support to stay the right side of the law.
You seem curiously reluctant to engage on this point around evasion vs avoidance. Hard not to conclude it’s because you recognise it as the area where you position doesn’t hold up.
@Liam Murray
I referred to tax cheats in my piece
Deliberately
You raised avoidance
I did not
The European Union Savings Tax Directive has just one goal – to stop tax evasion
Jersey undermines that – deliberately – by not reporting those opting for non-disclosure when they should in every case
That’s deliberate assistance for money laundering by the Jersey government in my opinion by not demanding this disclosure
This is evasion I’m talking about
It’s you who seems to be deliberately missing the point
You’re suggesting people availing themselves of a scheme formally agreed between the EU & other countries be automatically suspected of tax evasion and reported as such. Why not change the scheme rules if the abuse is as systematic as you allege? To suggest the banks should routinely report people is bizarre.
I’m not trolling here for the fun of it Richard – I’m actually quite supportive of wide-ranging changes to legislation to crack down on evasion and secure a fairer contribution from banks etc. But I think that case is frequently (and fundamentally) undermined by people regularly letting the boundary between evasion & avoidance blur. As far as I’m concerned provided Barclays (or whomever) have stuck to the letter of the law (yes, letter, none of this subjective ‘spirit’ nonsense) then they should be left in peace; if campaigners think the law should be different then they should picket parliament or their MPs to get that changed.
@Liam Murray
a) I’ve worked for the change in the law referred to on the blog this morning
b) I am saying I do not think MLOs are complying with the law – but that’s my opinion
I therefore disagree with your analysis
Although “benefit fraud” is a criminal offence which should not be condoned it costs the UK a twentieth of the huge losses suffered by the Exchequer from tax evasion (and avoidance) courtesy of tax cheats (mostly giant corporations) operating out of tax havens.
Benefit fraud is often thrown into the argument as a diversion to switch attention away from a far larger problem of tax evasion/avoidance which is disastrous to the economies of third world countries.
Tax evasion kills people whereas there could be a (very tenuous) argument that benefit fraud (illegally) benefits (some) people.
OK, we’ll agree to disagree. Thanks for the discussion…..
@Premier Shareholder Group
At the risk of re-opening the debate Richard & I had this rather makes my wider point:
“…far larger problem of tax evasion/avoidance….”
The conflation of the two is fundamentally misguided and actually undermines the efforts of those that campaign for fairer taxation. The sentence is akin to someone saying:
“…benefit claimants / fraudsters are….”
As for scale, again it’s the loose terminology which interests me. I’ve never seen figures that compare benefit fraud with tax fraud or evasion; it’s always compared against tax evasion/avoidance which, as above, is meaningless. The direct comparator there wouldn’t just be benefit fraud but legitimate payments also.
The PSG clearly wrote that benefit fraud was “often thrown into the argument to switch attention away from a far larger problem of tax evasion/avoidance …” This statement was not an attempt to “conflate” the two issues but was introduced to demonstrate that tax dodging costs the tax payer far more than benefit fraud.
Secretive and obscure places such as Jersey, Guernsey and the Isle of Man are where tax dodgers know (hope) that, aided by complex trusts and duplicitous governments nobody will uncover them?
After this your remarks become almost undecipherable. Why do you wish to take into account unavoidable and legitimate benefit payments when the discussion is about of avoidable costs to the tax payer caused by benefit fraud?
In the UK benefit fraud costs the tax payer (Exchequer) an estimated £1 billion a year. The total cost to the tax payer caused by tax dodging is unknown (thanks to secretive tax havens) but is though to be in the region of £35 to £40 billion a year
@Premier Shareholder Group
“…far larger problem of tax evasion/avoidance….”
That’s the direct quote where I suggest you’re conflating to two issues. If I’m reading it wrong let me know but since you separate them only with a ‘/’ I think the point stands for itself.
“Why do you wish to take into account unavoidable and legitimate benefit payments when the discussion is about of avoidable costs to the tax payer caused by benefit fraud?”
Because in the comparator usually cited – including by PSG in the subsequent paragraph – you include both legal & illegal tax ‘dodging’.
You can compare benefit FRAUD and tax FRAUD legitimately enough, you can’t compare benefit FRAUD and legal tax avoidance – it’s a fairly fundamental category error.
@Liam Murray
Utterly untrue
First define evasion
And then avoidance
And see if you can spot the difference
Or the difference in outcome
Both entail abuse of the law
And that includes abuse of law internationally as well as locally – which Jersey ignores
Your argument is a straw man dependent upon the belief that you can always tell the difference between these two beasts – in practice that’s frequently very, very hard. Which is why tax authorities treat them synonymously
@Richard Murphy
“First define evasion.”
Illegal behaviour.
“And then avoidance.”
Legal behaviour.
“And see if you can spot the difference. Or the difference in outcome”
Eh… one is illegal and one isn’t. Often no difference in outcome whatsoever. As with me driving down two different roads at 40mph – behaviours identical, outcomes identical, legal status entirely distinct.
“Your argument is a straw man dependent upon the belief that you can always tell the difference between these two beasts – in practice that’s frequently very, very hard. Which is why tax authorities treat them synonymously”
My argument doesn’t rest on that at all because I happily acknowledge they’re extremely hard to tell apart. I just believe the state has a duty to make & uphold that distinction and where dubiety exists – as in all other areas of the law – the subject is innocent until proved guilty. Suggesting we forego that option because it’s ‘very, very hard’ is almost too ridiculous a comment to merit a reply.
Quick final thought emerging from the notion of comfort that the tax authorities treat things synonymously because they’re hard to tell apart; how about the police struggling with legitimate protest & crimimal damage, or the courts between freedom of expression and libel? Should we diminish that distinction because it’s not always an easy one to draw?
The difficulty in telling avoidance/evasion apart is due to the difficulty in writing and passing laws to legitimise what is illegal, anti-social and immoral. It isn’t an easy trick, even for the most assiduous cheats and scroungers and their brilliant legal-governmental teams. The general public’s perception of both evasion and avoidance as planned and determined cheating is spot-on and hard to counter.