When I think about the various PAYE, VAT and corporation tax bills I pay, I do wonder why some people think we should try to avoid them. Many of us have been to state schools, seen our kids born in NHS hospitals and had operations at some point. These things are regarded as ‘free at the point of delivery’ but the money doesn’t come out of thin air. It comes from the tax we all pay.

Glossy Brochures

Over the years, I have had various glossy brochures turning up on my doorstep saying how I can be more tax efficient. They mean cheating the system of course but they never say that. When you read them, they are meant for people a lot richer than me and nearly always involve a British territory with a ‘favourable’ tax system.

They make it look nice and have well paid accountants making it technically legal, at least at the time of printing the brochure. However, it’s cheating. It involves giving the HMRC the runaround and as soon as they close one loophole, another one opens. Lots of rich people utilise these offshore accountants because they are so mean, they can’t face paying tax. They think they are above such a hindrance.

Conflict of Interest

if people want to indulge in this legal but morally bankrupt process, that is up to them. I continue to live in hope that they will come to a sticky end. However, I’ll tell you where I have a real problem. How can a government setting the rules, be littered with cabinet members who use tax avoidance schemes? How can that possibly work?

If MP’s can’t be morally upstanding with their tax affairs, it only leads to one thing. Businesses will start saying, “sod it, if they don’t play by the rules, neither will I”. That’s the way it works. That’s why people use tax havens, or abused furlough or Covid loans. They see the government raiding public funds, so they have a go themselves. The government couldn’t go after Covid fraudsters as it would have involved chasing down their own members and donors. So billions of pounds just gets written off.

Untenable

There should be a situation where politicians using dubious tax systems cannot serve in government. What is there to be gained by having a tax system imposed by a government that its own MP’s don’t obey? In the instance of Nadhim Zahawi, he should have left office the minute it became knowledge he had received an HMRC penalty.

He says it was a mistake. If there was a mistake, it was that he (or his accountants) thought putting the money in a Gibraltar trust was legal tax avoidance. It obviously wasn’t, as he has had to pay the tax and a penalty. As I read it, that makes it tax evasion rather than legal tax avoidance. If it was legal, he wouldn’t be liable for tax or paying a penalty. Whatever way you look at it, it’s dodgy.

If sitting MP’s can get away with not paying tax, public services will go on being underfunded. The exodus of underpaid public servants will continue and the country as a whole will become a lot worse for it. We can’t live in a country where nurses get clapped, then demonised, for simply wanting a fair wage whilst people like Zahawi rob the tax man.

It’s utterly ridiculous.