6 comments on “More on the PAC and tax dodgers

  1. I’ve said it before and I’ll say it again – the massed ranks of the tax evaders are the 90% not the 10%. If you could magically see into the financial affairs of the average council estate you’d see more tax evaders by numbers of people than if you could do likewise in the leafy suburbs, and even less as you inspect the uber rich. Not least because there’s a dis-economy of scale to tax evasion – hiding a few hundreds or even thousands of undeclared income is considerably easier than hiding tens or hundreds of thousands.

    I mean how could you acquire £100K in income that wasn’t someone else’s documented legit expenditure, paid through the banking system (and therefore highly visible) and also manage to spend it in a way that wasn’t obvious? The only way I can think of is drugs/crime, and thats a different ball game entirely. Whereas getting paid cash for odd jobs and the like on top of your PAYE income is virtually undetectable, and I would argue, rife. As would be paying cash to tradesmen to evade VAT and/or aid the tradesman to evade tax.

  2. Years ago I used to know a kleeneze distributor, a retired gentleman with a state and works pension together.
    His business made him probably only about £5k a month at the time, he used to boast about not having registered as self employed so he kept most of that.

    Not the only pensioner I have come across who worked and avoided tax on the work. Just the one with the biggest income at the time.

  3. And whining continues by MPs about the lack of prosecutions of tax evaders.

    This is down to HMRC’s policy of agreeing to civil proceedings in exchange for full disclosure and full cooperation.

    And why do they have this policy? Because successive chancellors have confirmed in parliament that this is official government sanctioned policy.

    MPs criticising HMRC for doing what MPs tell them to do.

  4. And why do they have this policy? Because successive chancellors have confirmed in parliament that this is official government sanctioned policy.

    Which leads us to the question “Why is this the official government sanctioned policy?”, the answer to which is “because it brings in the most money for the least effort”, which is kind of the whole purpose of taxation.

    It’s all very well sending hit squads into businesses to do various “compliance” inspections, but if those teams find nothing out of order (or at least just niggling issues), then it is a waste of time, effort and money, both for HMRC and the client suffering the inspection.

    These “compliance” inspections are to a certain extent necessary as fear of inspection creates more compliance than would otherwise occur, so individually they may be a net loss, but beneficial in aggregate (as aggregate tax revenues are higher due to fear of inspection).

    Tax collection is not just about money and boots on the ground, it is a classic example of game theory in action.

    As Jean-Baptiste Colbert (French politician who served as the Minister of Finances of France under Louis XIV) famously said:

    “The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the least possible amount of hissing.”

    There is no way to gloss it over, taxes are not voluntary contributions, but forced extractions, allegedly for the purposes of creating a “safe and fair society”, but the amount of waste, bad spending, poor services and incompetence is astounding.

  5. Remember that big tax audit recently? Took what? 6 years at whatever cost to find…. basically nothing.

  6. “The filthy rich aren’t all filthy tax dodgers”

    Why, it’s almost like.. I mean, it couldn’t be… Look, this idea Tim’s opposing really is just Nazi propaganda with the word ‘jew’ changed to ‘rich’. That really is all there is to it.

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