“Tax provides the funding to run the country: hospitals, schools and everything else,” he says. “Every time someone pays cash in order not to pay VAT, the nation gets diddled.”
The nation is not the government, the nation is not the government finances.
The nation contains within it the government, of course, contains the government finances as a subsidiary part of said nation.
So it is true to say that tax evasion diddles the government, diddles the government finances, but not that it diddles the nation. For tax evaded gets used or spent somewhere else in said nation, by another part of said nation. Yes a builder having a bevvy off a non-taxed transaction is indeed still part of the nation. It isn\’t lost to the nation at all: only to the government finances.
Which, as above, is not the same thing as the nation at all.