Yes Ritchie, you have

I have often argued about the absurdity if the UK underinvesting in HM Revenue & Customs at cost to us all in terms of lost public services and in the distortions created in the economy as a result of the unfair competition that is created by the failure to collect races from cheating businesses.

One of the reasons more people don’t do this is that more people aren’t paid by the taxman’s union to make this argument.

31 thoughts on “Yes Ritchie, you have”

  1. This is unreadability of an unusually high standard from the Tax Todger. Did he really right “races”? Has his iPad got fed up with writing “taxes”? Or is this lumpy subbing?

  2. Worstall, I love you, but this is exactly the type of appeal to motive fallacy that I normally associate with the left.

    He’s wrong because he’s wrong, not because he’s paid by anyone. See: Koch Brothers, The

  3. I think Murphy has said somewhere that he uses dictation software, so maybe with “races” he was sipping a cup of tea as he said “taxes” 🙂

    I agree with him that HMRC should have better resources, but I do think he could have phrased it better. I suspect that may be another artifact of dictation: if you dictate and don’t then re-write, you end up with language which is closer to spoken than written; it is therefore a little harder to read than if it had been written in the first place.

  4. @Pellinor

    You could be right, but ‘r’ and ‘t’ are next to each other on the keyboard as are ‘c’ and ‘x’ and moreover I believe his iPad has form in typing what it, rather than he, wants.

    Which does make one wonder why anyone should follow his precepts if even his own ‘device’ prefers to go its own way.

  5. You make a good point. Although I note that the r is to the left of the t, but the c is to the right of the x, and normally that sort of transposition comes from the hand being shifted over.

    It may be that he only made one typo, of course, and “raxes” or “taces” has been auto-corrected to “races”. Though why one would want to auto-correct a perfectly common word like “taces” is beyond me.

  6. For him, the primary goal of any tax system is to be as labour intensive as possible.

    Just about all his arguments about tax revolve around this one core idea.

    He likes lots of paperwork, lots of need for inspection, lots of negotiation (GAAR?), lots of complexity. This is behind his keenness for corporation tax – creates loads of work. And he is dead against any simplification of the system.

  7. On simplification, I read a nice tribunal case this morning (Philip Shirley v HMRC), where the Tribunal says:

    …it is not possible to ascertain a consistent and logical basis in the legislation for the taxation of dividends. Whilst there might have been some sort of logical underpinning to the basis of taxation of dividends in the early 1970’s, when the partial imputation system was introduced (with ACT and tax credits) – any such logic had long disappeared as a result of the many amendments to dividend taxation in the period leading to the enactment of ITTOIA. Parliament has chosen to legislate for a system of great complexity, involving different tax rates, tax credits, deemed payments of tax, grossing up and various other matters. There are no logically consistent principles (as it were) underpinning the taxation of dividends…

    Tax the gross dividend at nil/25%/30%. Job done. No difference in 99% of cases; no material difference in the rest.

  8. I always love his references to unfair competition. Given his absolute insistence that only capital bears the cost of Tax I wonder how non – compliant businesses (as opposed to its owners) can gain an advantage.

  9. bloke (not) in spain

    Matt Moore

    “Worstall, I love you, but this is exactly the type of appeal to motive fallacy that I normally associate with the left.

    He’s wrong because he’s wrong, not because he’s paid by anyone. See: Koch Brothers, The”

    On the contrary. His motive is to benefit himself. From that basis he argues towards a position will do so.
    This is far from a left monopoly.. Most of the pro-Tory/anti-UKIP columns in the Telegraph have been doing the same for months. Starting from a premise of “Vote Tory not UKIP” then attempting to construct rationalisations towards justifications. Why they’ve had such a poor result.
    And far from being rare, this is how the majority of people rationalise. It’s the whole basis of the confidence trick. Why they’re successful.

  10. He’s wrong because he’s wrong, not because he’s paid by anyone.

    Nope. I would argue he is wrong because he’s wrong AND he’s a shill for the main HMRC union, the PCS.

    I’m not letting the Lord High Tax Denouncer get away with anything. These fuckers need to be brought up on their hypocrisy.

  11. I suspect “not fit for purpose” isn’t in RM’s vocabulary and he believes that the runner with the most expensive pair of running shoes will win any given race.

    Sheesh – he’s a clown – but unfortunately his jester talents are misunderstood and he’s mistaken for a sage by the “progressives”….

  12. @Ironman

    Indeed. As CT is paid on profits, avoidance cannot possibly give a trading advantage. This is very much lost on the campaigners.

    It can confer other advantages, of course, such as making it easier to accumulate cash for investment. But tax avoiders don’t invest, right?

    Avoidance of other taxes (eg VAT) obviously does give an advantage. Hence the pasty tax debacle. Remind me where ‘the left’ were on that instance of government trying to legislate to remove a competitive advantage endowed by the tax system (albeit I don’t recall RM taking a position, which probably means he recognised is as a good policy, but wasn’t about to take Osborne’s side on the matter).

  13. On his Lewis Hamilton thread people are quoting chapter and verse from HMRC handbooks and legislation to prove he is wrong, yet Ritchie’s still insisting he is right.

    I’m not a tax lawyer so I don’t know. Perhaps one of the resident experts here could tell me the real situation?

  14. Looking at the facts:
    -Hamilton’s father is from Granada
    -Hamilton was born in the UK
    -He moved to Switzerland at the age of 22 (according to Wikipedia)
    -He has lived outside the UK since then

    Hamilton’s domicile of origin would normally follow his father’s domicile at the time Hamilton was born. His father would have had a Granada domicile of origin, but (again according to Wikipedia) he had lived in the UK since the ’50s. This might suggest that he had acquired a domicile of choice in the UK by the time his son was born, in which case Hamilton would have a UK domicile of origin.

    The next question is then whether Hamilton, if he has a UK domicile of origin, has acquired a non-UK domicile. He has moved to Switzerland and then Monaco in the last few years, so the facts are ambiguous. This would depend entirely on what his intentions are regarding living in the UK permanently, but unless he has done something to settle in a specific non-UK country I would expect HMRC to resist the suggestion that he has acquired a non-UK domicile of choice.

    Incidentally, moving abroad when you are 22 suggests that you do not intend to acquire a UK domicile of choice, although of course it is not conclusive.

    So the question then comes down to:

    -Did his father intend to reside in the UK permanently when Hamilton was born?
    -If so, has Hamilton formed the intention to live somewhere specific outside the UK?

    For him to be UK-domiciled, the answers need to be Yes and No. Any other combination will almost certainly result in him being non-UK domiciled.

    To decide, we need to look inside Hamilton’s head, and his father’s. I couldn’t give a confident answer either way on the facts available to me.

    Domicile is pretty much irrelevant for income tax purposes, though, if you’re not UK-resident in a given year.

    Hamilton could go out of his way to establish a UK domicile, if he doesn’t already have one, and he could probably do something (buy a house, visit more often, have children and send them to school here) to try and become UK-resident under the statutory residence test. The question then is how far it is appropriate to deliberately change your behavior in order to become resident in a particular country, if that country is the UK.

  15. Whether Hamilton Snr had acquired a domicile of choice would depend on what his intentions were. Domicile of origin has a lot of legal inertia so if Hamilton Snr said he intended to retire to Grenada, that would be enough to keep his Grenadian domicile. Indeed, all he’d have to do is say he had no intention of making the UK his permanent home.

    Murphy’s more absurd claim is that all you have to do is file a tax return saying that you’re UK domiciled and that’s it. For a start, I don’t think you CAN file a tax return that says you ARE UK domiciled, only one where you claim you are not.

    Murphy (as is often the case) sees only one side of the argument. Why would the UK object to someone saying they were UK domiciled? They probably wouldn’t but some other country might. Although Murphy thinks only the UK and Ireland have a domicile concept, in fact many countries do (I know that with India there’s a wrinkle about the UK deemed domicile rules not applying to Indian domiciled individuals living in the UK because the UK/India treaty pre-dates the deemed domicile rules).

    The point is that it can’t be made easy to acquire UK domicile (“tick here”) as it would then be just as easy to lose it.

    I agree with Pellinor, quite what the Hamilton answer is isn’t clear but Murphy demonstrates a huge amount of ignorance on the subject for a self-proclaimed tax expert of 30 years.

  16. @GlenDorran

    You’ll note that those arguing with Murphy are indeed quoting handbooks and legislation, while Murphy is quoting himself.

  17. Richie’s proviso on tax avoidance is that loss of public service would “cost” us.

    Got a headache? You could be one of the 22 million who got a prescription for paracetamol and the taxpayer cost is £3.67 a pop, this is for medication that Superdrug sells for 19p. That’s one “cost” I wouldn’t mind losing. I am sure I can find plenty of others.

    At the end of the argument about tax, the real issue is what the government spend it on, and I am sure that Richie would have a lot tougher time justifying his paymasters morally corrupt economic habits that have left us bankrupt than just ranting on about “cheating” businesses. Once you’ve removed the justification for more tax, there is simply no argument about how it is collected to start with.

  18. HMRC’s guidance (RDR1) explicitly says “We do not normally challenge any person who says they have a UK domicile.”

    Which seems fair enough 🙂

    The wider issue is that Murphy is using domicile as a proxy for nationality. I’d have thought it fairly clear that a UK sports personality should be of UK nationality; but Murphy seems to think that you’re not really a UK national unless you’re domiciled (and probably resident) here, which seems to be using a tax concept for a purpose it’s not really meant to cover.

    If domicile and nationality are meant to be identical, it would be perfectly possible to introduce legislation to align them. As Parliament has not done so, one has to assume for the moment that they aren’t meant to be the same.

  19. @Pellinor

    I agree that HMRC wouldn’t challenge it but as I said, it’s other tax authorities that might. In Ireland (for example) they have the Domicile Levy which would be too easy to avoid if it was just a question of an Irish guy ticking a box on a UK tax return. That’s the point that Murphy doesn’t get.

  20. Oh, I agree entirely. Murphy, however, gives UK tax a certain privilege above that of other jurisdictions: he once told me that a company paying £1 less tax in the UK but €2 more tax in Germany as a result of an intercompany transaction was engaged in unacceptable tax avoidance, for example.

    So in a Murphy-based discussion, the views of non-UK authorities are not really admissible evidence 🙂

  21. “You’ll note that those arguing with Murphy are indeed quoting handbooks and legislation, while Murphy is quoting himself.”

    That’s because he KNOWS he is right, but can’t be sure about the law – after all, these could be neo-liberals trying to trap him.

  22. I think that the Swiss tax authorities would want to have strong words with Lewis Hamilton if he claimed to be tax resident in the UK, as Ritchie suggests. Switzerland being, you know, where he actually lives and consumes services. UK tax normally being higher than Swiss tax, him paying tax in the UK would result in total elimination of his Swiss tax burden. Which, if he’s in normal tax rather than the “Pauschalsteuer”, will be less than the UK, but not low by any objective standard (he’d probably be better off in France than Vaud since much of the taxation is a “social charge” on the employer which, if your employer is not in France, is not paid.)

    Luckily, the UK-CH tax treaty is quite clear on this point though… I suspect if he tried it and didn’t voluntarily submit to double-taxation Vaud would take him or the UK to court… and win.

    And yes, Ritchie does prioritise UK tax above all others, as if the UK is the centre of the tax universe. I guess all foreigners only live abroad so that they can avoid UK tax too.

    Plus, as a UK national living in CH, I take this whole business rather personally and seriously. 1. 90% of CH is NOT a tax haven for wage slaves like me, and 2. UK-levels of taxation would wipe most of us out since the salaries and cost of living is so high on paper (actually, they’re not, it just seems that way due to the skewed exchange rate and the fact that you have to pay out of pocket for fucking everything).

  23. “That’s because he KNOWS he is right, but can’t be sure about the law – after all, these could be neo-liberals trying to trap him.”

    Well, the Letter of the Law is just a neoliberal construct.

    Par contre, he is Tax Judge Dredd.

  24. “And yes, Ritchie does prioritise UK tax above all others, as if the UK is the centre of the tax universe. I guess all foreigners only live abroad so that they can avoid UK tax too.”

    Does that make him a socialist of a nationalist tendency?

    (Sorry, couldn’t resist!)

  25. “And yes, Ritchie does prioritise UK tax above all others, as if the UK is the centre of the tax universe”

    It always amuses me when the idiot brigade claim that both UK companies operating abroad and foreign companies operating in the UK should pay UK corporation tax.

    It doesn’t seem to occur to them that no other country is going to be keen to sign up for this.

  26. “It doesn’t seem to occur to them that no other country is going to be keen to sign up for this.”

    He doesn’t care. He only sees the UK. When questioned about reciprocity on his desire to impose UK income tax on all UK nationals abroad, he said words to the effect of “We’re not talking about other countries, only the UK”. As if the other countries would tolerate a one-way flow of money out of their economies into the UK and would just suck it up.

    There’s the UK, and around it is a tax-avoidance vacuum. Some say there be dragons.

  27. Bloke in Costa Rica

    Why is some Irish cunt living in Norfolk presuming to lecture us on what constitutes UK domicile? Does he pay Irish taxes?

  28. Bloke in Costa Rica – I think barring a handful of sycophants his credibility is shattered beyond repair. The Hamilton thread is the latest train wreck in a string of disastrous entries that resemble an ISIS video in terms of a horror show- he has nothing beyond a nebulous ‘belief’ in his own sorely lacking knowledge and bluster/ personal insults – as far as influence goes he is now appealing only to the maniacs on the Far Left…

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