Monday, 20 May 2013

There is no moral basis for taxation...


This isn't an argument against tax but a simple statement of fact. We pay taxes because we have to and, possibly, because we get some sort of benefit from the payment of those taxes. And in paying those taxes it is entirely proper for us to arrange our affairs so as to pay only the tax that is due and nothing more. I would add that it is for the tax authorities - and no-one else least of all parliament - to assess what we pay and determine whether we have complied with the rules parliament has prescribed.

If parliament believes that I do not pay enough taxes (and assuming that I am not guilty of evading taxes which is a crime) then parliament has it within its power to change the rules that determine how much tax I pay. None of this is about any sort of moral duty or responsibility. Taxation is merely expedient - the means whereby government secures the revenues that government needs to carry out its purpose.

It rather worries me that - for reasons of political opportunity rather than good government - politicians (aided by their friends and relations in the broadcast media) have decided to whip up some sort of mob, to conduct a sort of moral crusade targeted primarily at large corporations.

Why does it worry me? Quite simply because corporations - businesses of one sort or another - are what will lift us out from the ire of recession. It won't be government however much they wish to scatter the magic fairy dust from the basement of the Bank of England across the land. It won't be shiny new value-destroying railways, ridiculous floating airports or delving ever more tunnels under London (there is something wonderfully Swiftian about today's infrastructure schemes) that will provide that elusive growth.

Yet every politician is now dragged into condemnation of tax 'avoidance' - from committees of MPs asking impertinent questions of people who actually contribute to the economy (unlike those MPs) to cabinet ministers writing pleading letters to jurisdictions with tax regimes that have met with disapproval. All to pretend that somehow this attack will help make the economy better and, worse still, accompanied by words like 'evil', 'corrupt' and 'immoral'.

There is no moral basis for taxation - government imposes a levy on our incomes, wealth and expenditure because it can do just that. But this is not a moral act and seeking to reduce how much tax we pay is therefore not immoral. What we see in a ghastly ignorant mob egged on by politicians and other hacks who point at businesses and successful men crying: "look there, wealth and money! We should have more of that for us to spend. These people are moral pygmies for not paying more tax than they owe!"

And the business people are dragged before the media - the court of mob rule - and accused of what? Essentially of complying with the rules set down by parliament, the European Union and contained in solemn treaties between sovereign nations.

Put yourself in the place of those businesses - international in scope and purview. Do you decide to develop your UK business? Or do you go somewhere else? Perhaps China, Brazil or Indonesia - places where the government welcomes your acumen, investment, jobs and wealth.

There is so moral basis for taxation - saying so is stupid and damages our economy.


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