But Richard Murphy in The Joy of Tax argues there is another stakeholder that should be paying up: the company. With characteristic certainty he notes that “companies quite emphatically have property rights and that means that they have to pay tax in their own right”.
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He pours scorn on the “argument of libertarians that companies registered by law are nothing more than a bundle of contracts and that they have no real existence”. Murphy’s comments are of course correct in their driest legal sense.
That bit in italics is there in the Telegraph piece. Which I think is lovely given the Murphaloon’s history of advocating that in the pages of The Observer. And his own use of the idea as well.
But as ever he’s missing the point of the argument (I assume that I’m one of those libertarians of course). It’s not that a company isn’t a separate legal entity. It is, quite obviously. It’s that all and any tax makes the wallet of some live human being lighter. Therefore the economic burden of a tax must be measured by whose wallet it is that gets lighter.
And with corporation tax we know who that is. The investors in he company being taxed, in the form of lower returns, and all workers in the jurisdiction imposing the tax in the form of lower wages. And that is simply true.