Sad when an accountant cannot add

We\’ll let one of Ritchie\’s commenters do the heavy lifting here:

Gauke isn’t in conflict with his boss, you’re confusing some of the figures:

Assume the tax gap is £42bn, as stated. That’s close enough to Gauke’s £40bn if £84bn is “close enough” to your estimate of £95bn.

George Osborne referred to £14bn being the figure for tax avoidance AND evasion together. As you say, that’s about 33% of the tax gap, or one third.

The document on tax avoidance talks about avoidance only, not evasion, and estimates it at 17.5% of the tax gap. Which is about one sixth of the tax gap, and is about £7bn. That’s consistent with Gauke’s figures, so Gauke is agreeing with Osborne’s figures, as he’s talking about £7bn of avoidance (not avoidance and evasion).

If avoidance is around £7bn then evasion must also be about £7bn, being the other half of the £14bn and is therefore consistent with the other one-sixth that Gauke refers to. The two one-sixths make up one-third, and so you get your £14bn out of £42bn.

So there’s no real inconsistency. Certainly not if you think £84bn is close enough to £95bn.

12 thoughts on “Sad when an accountant cannot add”

  1. JustAnotherTaxpayer

    He has not read the flipping HMRC document on the tax gap! Un-be-flipping-lievable! In the comments he justifies his claim by saying

    “the tax gap, by definition, is made up of avoidance and evasion”

    Which is simply not true of the HMRC analysis!

    http://www.hmrc.gov.uk/stats/measuring-tax-gaps-2010.htm.pdf

    page 65; the tax gap is made of

    17.5% avoidance
    17.5% evasion
    15% legal interpretation
    15% failing to take reasonable care
    12.% criminal attacks

    35% of £42bn is indeed £14.7bn, 1 plus 1 does equal 2, and the only thing which does not add up is why Tax Research LLP has not done any Tax Research into the Tax Gap.

  2. As an anarchic libertarian (leastways that’s what I think I is, if useless dickhead is a euphemism for anarchic libertarian then MrsBud agrees), I feel it my duty to contribute to the tax gap as much as I possibly can and I don’t have any qualms about which method is used as long as my fellow tax slaves do not suffer.

  3. Murphy seems to think that it all belongs in the last category – criminal attacks on the tax system.

    Except of course when it’s him doing it.

  4. You are really giving this guy too much publicity. What is the point?
    Just ignore his stupidity and concentrate on more important issues otherwise your posts will become repetitive and boring.

    Look at it as a care in the community project.

  5. @6
    Oh, I think a lot of it here regard it as like shooting rats. Pointless waste of ammunition, really but it keeps your aim in, is good fun & at least keeps the vermin down a bit.

  6. @ ukliberty
    You are flattering him: he blocks comments on all posts from critics who regularly prove him wrong *or whom he expects to do so*. After one thread I am permanently banned because I am more highly qualified (actually significantly more highly qualified) and offered to debate some of his nonsense.
    RM “Can anyone serious debate this”
    J77 (volunteers)
    RM “Are you serious – I asked for someone serious”
    J77″Yes I am serious” (gives some details)
    RM “I don’t know – you’re just J77”
    J77 “You can check – your sever has my email address”
    RM (denies it)
    Pause while RM suppresses my later comments
    RM to another poster “I know who you are from your email address …”
    J77 “So you know who I am, young man”
    RM throws a tantrum at condescension from an elder and better and bans me for life

  7. John77 richie in a tweet reply to me and Frances Coppola claimed I talked shit and 90% of comments get posted, only spam and abuse is removed.

    Unless you’ve had the “neo-librarian troll” reply, then you haven’t debunked him enough yet.

  8. Tim, here’s one for you….

    Students angered about the cuts that closed their Student’s Union, protest by proving that you don’t need money to have a good time. Genius!

    http://www.guardian.co.uk/commentisfree/2011/mar/25/students-alternative-occupation-glasgow-university

    “The Free Hetherington has now moved beyond a protest against cuts to a living example of the alternative. Students have democratically organised the space as a resource for the local community without any support or funding from the university.”

  9. I’ve told you for years that Ritchie lacks the intellectual horsepower and professional competence to understand the between avoidance and evasion.

    Haven’t I?

    So why is this coming as a surprise?

    Ritchie is, after all, nothing if not consistent.

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