Even better economics here

From the Tuberosa:

I would stress that this is the likely apportionment, in my opinion, within the UK. But as my evidence also suggests, the overall shadow economy in that country is approximately 10% at present. In those countries where the shadow economy is proportionately somewhat larger, and this is true for the vast majority of EU member states, so too might the proportion of VAT loss attributable to activity in the domestic shadow economy also be higher, in my opinion. I stress then that in my opinion when it comes to VAT fraud, important as international issues are, domestic tax gaps are now by far the most important issue of concern.

That pesky Laffer Curve, eh?

Tax as a portion of GDP is rather higher in most EU member states than it is in the UK. As Tuberosa tells us, they have rather larger tax dodging economies, thus more VAT going uncollected.


All we’re saying with Laffer is that at some point that dodging – in any and every form, from evasion through to working less or differently – outweighs the extra revenue from those not dodging.

3 thoughts on “Even better economics here”

  1. “I would stress that this is the likely apportionment, in my not a fuck humble opinion, within the UK.”

    O Solanaceous One, whither learnedst thou to pen verbiage even as though one hadst a broomstick up one’s sphincter?

  2. My German cousins assure me that tax dodging in German is considerably greater than merely rampant. And yet, they continue to support high tax politicians in Germany and the EU.

    But Germans are crazy.

  3. @ Fred Z
    Tax dodging is a minority pursuit, which is usually a consequence of *other people* supporting high tax politicians.
    I can still remember the schadenfreude in the City (among my generation, nearly all of whom were employees – our elders may have shared it but didn’t chat to us about it) when such large numbers of “tax consultants” became unemployed that the media ran articles about it after Geoffrey Howe cut the top rate of tax from 98% to 60% (and collected more tax as a result).

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