Tuesday, November 09, 2010

The Coalition backs tax avoidance and evasion

George Monbiot takes a look at tax avoidance and evasion today in the Guardian.

To summarise his points:

Government estimates that each year £42 billion is lost through tax avoidance and evasion.
The ever excellent Richard Murphy says this is an underestimate. He gives:
Avoidance:              £25bn
Evasion:                  £70bn
Outstanding debt:     £28bn
Total                      £123 billion.

Total borrowing in 2009-10 was £170billion, 155x as much as benefit fraud which so preoccupies the tabloid press.

Tax avoidance accounts for 72% of our borrowing requirement.

You would imagine that Government would set about blocking tax loopholes and attacking evasion. You would imagine wrong.

Government has been cutting staff at HMRC (the tax man). Its staff has fallen from 99,000 to 68,000 (that was a Labour cut). The budget of the HMRC tax avoidance office has fallen from £3.6bn to £1.9bn.

It is quite clear that Government is not interested in taxing the corporations and the rich who can afford tax lawyers, but rather, is interested in high profile chasing of small benefit fraudsters. These little crooks are quite rightly to be chased, but it is clearly less efficient to chase someone who owes say £1000 than someone who owes £1000000. The Government has deliberately chosen the inefficient path.

There are many reasons for this.

The bottom line is that we are not all in this together. There is one rule for the rich - take whatever you can get away with, and another rule for the poor - we are coming to get you no matter what.

Outside, it is raining. Inside, it is raging.


rob said...

Yes - the Tory (the party of business) excuse or apology for avoiding (careful!!) tax was that they didn't like the level of tax on the high earners or/and that they didn't like what a Labour government spent their hard earned (?)income on.
Now they make up the rules for tax levels and make the decisions on spending and still they won't join in with "The Big Society".
I suppose it is not surprising when they prefer to take advice or are financed by businessmen who have made their fortune and intend to keep most of it by avoidance of this sceptred isle.

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