{"id":17210,"date":"2012-09-09T09:48:51","date_gmt":"2012-09-09T08:48:51","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=17210"},"modified":"2012-09-08T10:54:38","modified_gmt":"2012-09-08T09:54:38","slug":"if-closing-ten-tax-loopholes-is-not-enough-for-you-here-are-some-more-ideas","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2012\/09\/09\/if-closing-ten-tax-loopholes-is-not-enough-for-you-here-are-some-more-ideas\/","title":{"rendered":"If closing ten tax loopholes is not enough for you, here are some more ideas"},"content":{"rendered":"

I suggested ten tax loopholes to close yesterday<\/a>.<\/p>\n

If that's not enough for you there's plenty more tax reform to think about in a publication I wrote a couple of years ago for the Green New Deal group called The Great Tax Parachute<\/a>, which summarised a number of suggestions I'd made\u00a0on\u00a0this issue over the ear or two preceding that. One or two will have changed now, but only in detail.<\/p>\n

So try these suggestions from that publication\u00a0about how to tackle tax avoidance, \u00a0split into three groups. These are:<\/p>\n

    \n
  1. Implementable straight away with no consultation required, not least because this will prevent tax avoidance taking place;<\/li>\n
  2. Implementable after a reasonable consultation period to ensure that the policy is as effective as possible<\/li>\n
  3. Implementable after further research is undertaken on the necessary mechanisms to create the tax.<\/li>\n<\/ol>\n

    Grouping the possible changes under the above headings results in the recommendations in the following table. In each case a link is provided to the course of further information on the proposal.<\/p>\n

    Implementable straight away with no consultation required<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
    Recommendation<\/em><\/td>\nApproximate Impact<\/em><\/td>\nSource of further information<\/em><\/td>\n<\/tr>\n
    50 per cent tax on all income over \u00a3100,000<\/td>\n\u00a32.3 billion<\/td>\nCompass, In Place of Cuts<\/td>\n<\/tr>\n
    Taxing all capital gains at a taxpayers highest marginal income tax rate<\/td>\n\u00a32 billion<\/td>\nCompass, In Place of Cuts<\/td>\n<\/tr>\n
    Prevent anyone earning more than \u00a3100,000 a year claiming more than \u00a35,000 a year in tax reliefs above their personal allowance<\/td>\n\u00a314.9 billion<\/td>\nCompass, In Place of Cuts<\/p>\n

    TUC, A Socially Just Path to Economic Recovery<\/p>\n

    Green New Deal Group, The Cuts Won\u2019t Work<\/p>\n

    (variations on the theme available in each)<\/td>\n<\/tr>\n

    End tax relief for all salaries and benefits provided in kind\u00a0 that results in \u00a0an employee having total income from related employments exceeding ten times median UK earnings in a year (about \u00a3220,000 at present)<\/td>\n\u00a32.4 billion<\/td>\nTUC et al \u2014 Taxing Banks<\/td>\n<\/tr>\n
    Limit the time period for the carry forward of bank losses<\/td>\n\u00a35 billion<\/td>\nTUC et al \u2014 Taxing Banks[vii]<\/a><\/td>\n<\/tr>\n
    Reintroduce 10 per cent tax band to help those on lowest incomes<\/td>\n\u00a311.5 billion of refunds<\/td>\nCompass, In Place of Cuts<\/td>\n<\/tr>\n
    Uncap national insurance contributions and make them payable on investment income<\/td>\n\u00a39.1 billion<\/td>\nCompass, In Place of Cuts<\/td>\n<\/tr>\n
    Additional 10 per cent tax on bank profits<\/td>\n\u00a32.2 billion<\/td>\nTax Research LLP[viii]<\/a><\/td>\n<\/tr>\n
    Limit ISA tax relief to funds invested in new Green projects alone<\/td>\nNeutral<\/td>\nGreen New Deal Group, The Cuts Won\u2019t Work<\/td>\n<\/tr>\n
    Total<\/strong><\/td>\n\u00a326.4 billion<\/strong><\/td>\n\u00a0<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    Implementable after a reasonable consultation period<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
    Introduce a General Anti-Avoidance Provision<\/td>\nUp to \u00a35 billion pa<\/td>\nAssociation of Accountancy and Business Affairs\u2019 Code of Conduct on Taxation<\/td>\n<\/tr>\n
    Change the legislative basis for interpreting UK tax law so any action contrary to the spirit rather than the letter of tax legislation can be challenged in court<\/td>\nIncluded in above estimate<\/td>\nAABA Code of Conduct on Taxation<\/td>\n<\/tr>\n
    Introduce a mandatory Code of Conduct on Taxation<\/td>\nIncluded in above estimate<\/td>\nAABA Code of Conduct on Taxation<\/td>\n<\/tr>\n
    Abolish the UK\u2019s domicile rule<\/td>\n\u00a33 billion<\/td>\nTUC, A Socially Just Path to Economic Recovery<\/td>\n<\/tr>\n
    Introduce higher council tax bands<\/td>\n\u00a31.7 billion<\/td>\nCompass, In place of Cuts<\/td>\n<\/tr>\n
    Introduce a \u2018Robin Hood Tax\u2019 on all foreign exchange dealing in sterling<\/td>\n\u00a33.2 billion in the UK<\/td>\nRobin Hood tax campaign Budget Submission 2010<\/td>\n<\/tr>\n
    Reform rules on company residence so that companies cannot claim they\u2019ve left the UK simply by holding their board meetings in another country<\/td>\n\u00a31 billion at present, maybe more[ix]<\/a><\/td>\nTUC Pre-Budget report submission<\/td>\n<\/tr>\n
    Enhance the rules on controlled foreign companies so that intellectual property rights cannot be easily transferred to tax havens without tax being due<\/td>\n\u00a31 billion at present, maybe more<\/td>\nTUC Pre-Budget report submission<\/td>\n<\/tr>\n
    Restrict the offset of interest against taxable income both for companies to reduce the incentive to overload companies with debt.<\/td>\n\u00a31 billion at present, maybe more<\/td>\nTUC Pre-Budget report submission<\/td>\n<\/tr>\n
    Restrict the tax relief available to those borrowing to finance buy to let properties to create a level playing field between new owner occupiers and new landlords<\/td>\n\u00a32 billion, cautious estimate<\/td>\nTax Research LLP[x]<\/a><\/td>\n<\/tr>\n
    Demand that all tax havens in the world enter into Tax Information Exchange Agreements with the UK;<\/td>\nUp to \u00a34 billion<\/td>\nTax Research LLP, The direct tax cost of tax havens to the UK[xi]<\/a><\/td>\n<\/tr>\n
    Promote the use of new mechanisms for Automatic Information Exchange between all tax jurisdictions except those where human rights abuses are commonplace.<\/td>\nIncluded in above estimate<\/td>\nTax\u00a0 Research LLP<\/td>\n<\/tr>\n
    Possible total , but to be treated with caution as some proposals may overlap<\/em><\/strong><\/td>\n\u00a321.9 billion<\/em><\/strong><\/td>\n\u00a0<\/em><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    Implementable after a period of further research<\/strong><\/p>\n\n\n\n\n\n\n\n\n\n
    Reform the basis of tax residence in the UK so that a person with a UK passport is liable for tax on their world wide income unless they live in a state with a tax system broadly equivalent to the UK\u2019s.<\/td>\nNot yet clear, but maybe several billion a year<\/td>\n <\/td>\n<\/tr>\n
    Radically reform the way in which small companies are taxed to both simplify current arrangements and prevent abuse. This would require the income of such companies to be treated as belonging to their shareholders, unless those shareholders are not resident in the UK, so preventing tax deferral by use of corporate structures.<\/p>\n

     <\/td>\n

    		\u00a31.2 billion<\/td>\nTax Research LLP, Small Company Taxation in the UK:A review in the aftermath of the \u2018Arctic Systems\u2019 Ruling<\/p>\n

     <\/p>\n

    Green New Deal Group, The Cuts Won\u2019t Work<\/em><\/td>\n<\/tr>\n

    Introduce a \u2018Robin Hood Tax\u2019 on all derivate, swap, bond and over the counter trading in the UK<\/td>\n\u00a35bn, maybe much more<\/td>\nRobin Hood tax campaign, Budget Submission 2010<\/td>\n<\/tr>\n
    Reforming the tax relief for charities to stop abuse, increase the income of charities and to cut their administrative burden;<\/p>\n

     <\/td>\n

    		Neutral but significant admin savings<\/p>\n

     <\/td>\n

    		TUC, The Missing Billions<\/td>\n<\/tr>\n
    A \u2018bank debit tax\u2019 charging all payments from a UK bank account to tax at a tiny rate, and in the process replacing VAT, at last in part, with a more progressive tax based on a broader and therefore more progressive tax base<\/td>\n\u00a34.2 billion<\/td>\nCompass, In place of Cuts<\/td>\n<\/tr>\n
    Introduce country-by-country reporting for all multinational corporations based in the UK, and demand it be introduced internationally by the International Accounting Standards Board and European Union so that multinational corporations will be required to account publicly for where they declare their profits and where they pay taxes, including full disclosure with regard to tax havens and secrecy jurisdictions.<\/td>\nNot yet known<\/td>\nGreen New\u00a0Deal Group, The Cuts Won\u2019t Work<\/td>\n<\/tr>\n
    Introduce an empty property tax<\/td>\n\u00a35 billion<\/td>\nTUC, <\/strong>A Socially Just Path to Economic Recovery<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    \u00a0<\/strong><\/p>\n


    <\/p>\n
    \n
    \n

    [vii]<\/a> The estimate is made here. UK companies reduced their total deferred tax liabilities in 2008 by \u00a317 billion according to international accountants Deloitte. Not all of this would relate to banks and some losses will have been sued against profits in 2009, but the estimate is considered reasonable in the light of losses sustained by Lloyds, RBS, Northern Rock and others that were covered by tax bail outs and do not need to be relieved again.<\/p>\n<\/div>\n

    \n

    [viii]<\/a> http:\/\/www.taxresearch.org.uk\/Blog\/2007\/09\/18\/banks-must-pay-for-giving-up-their-risk\/<\/a><\/p>\n<\/div>\n

    \n

    [ix]<\/a> These estimates are provisional<\/p>\n<\/div>\n

    \n

    [x]<\/a> Currently unpublished research<\/p>\n<\/div>\n

    \n

    [xi]<\/a> Based on total estimated loss of \u00a38.5 billion less estimate for that part attributable to non-domiciled people that cannot be double counted\u00a0<\/strong><\/p>\n

    The Green New Deal Group are<\/strong>: Larry Elliott, Colin Hines, Tony Juniper, Jeremy Leggett, Caroline Lucas, Richard Murphy, Ann Pettifor<\/a>, Charles Secrett and Andrew Simms<\/a><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

    I suggested ten tax loopholes to close yesterday. If that’s not enough for you there’s plenty more tax reform to think about in a publication
     Read the full article…<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[74,10,50],"tags":[],"class_list":["post-17210","post","type-post","status-publish","format-standard","hentry","category-green-new-deal","category-tax-avoidance","category-tax-gap"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/17210","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=17210"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/17210\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=17210"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=17210"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=17210"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}