Labour to launch £5bn crackdown on tax avoiders to close gap in spending plans
Rachel Reeves has said an incoming Labour government would launch a £5bn crackdown on tax avoiders to close a gap in its spending plans exposed by Jeremy Hunt scrapping the non-dom regime to finance tax cuts.
Warning households and businesses that Labour was prepared to adopt tough measures to tackle tax fraud and non-compliance, Reeves said the funding would be used to pay for free school breakfast clubs and additional NHS appointments.
It is remarkable how certain adults nurture within themselves such a dismal collection of futilities as represented by this commonplace but abjectly typical example. The ability doesn't appear to demand much training either.
Yet there is not the smallest, most minute nano-possibility that this magical £5bn will behave itself and do two things -
- Turn up as planned.
- Fail to disappear without trace into the gaping maw of the public sector.
Every adult in the room knows this, even those who have trained themselves to stand up on their hind legs and claim otherwise. Every adult in the room knows it is merely an opportunity to emit certain words and phrases thought to suggest that other people will pay.
They won't.
11 comments:
I recommend that Labour announce that Premium Bond prizes, and all other gambling winnings, will be subject to income tax.
A crackdown on tax avoidance as a way of raising tax revenue is the political equivalent of someone saying on a dating app they like foreign travel and long walks on the beach. It sounded good for about 6 months when the internet started, since then its become a total cliche and everyone knows the reality is they actually like slobbing in front of the TV eating crisps and drinking wine.
The truth is that the vast majority of tax revenue lost does not come from the mega wealthy, or indeed just the wealthy, it comes from the poor and middle income sections of society. The wealthy can afford accountants and lawyers to make sure their affairs are in order, and set up to legally avoid taxes. Such people have no need for evasion - a surgeon is hardly going to offer to do operations on the side for cash is he? Whereas those down the income scale who are largely paid employees have only one route to not pay tax - to earn money on the side and not declare it. The amount evaded per person is probably quite small, but when its multiplied by millions of people it soon adds up. I've always said you'd find far more tax evaders by headcount in the average street than in the leafy enclaves of the wealthy.
All of which is a bit of a problem for the people trying to raise extra revenue. If you could shake down a multi-millionaire and get tens or even hundreds of thousands of extra revenue, a tax inspector could raise quite a bit in a years work. If on the other hand you have to spend all your time investigating plumbers, brickies, kebab shop owners and women doing house cleaning for cash, then you are going to be raising a few thousand per investigation. Its quite possible an inspector could fail to raise his own salary on such work.
dearieme - and Bingo and the National Lottery.
Sobers - they also like fitting in words like 'crackdown' as it suggests an intention to be firm in righting wrongs.
The drive towards a cashless society, including CBDC, does suggest you are right about tax lost via millions of undeclared cash payments. Governments probably think it will pay for itself many times over. Although waste must effectively equate to an enormous tax loss, governments don't see it like that, they see it as their web of patronage, favours and opportunities for the elites which wouldn't withstand market competition.
"...they also like fitting in words like 'crackdown' as it suggests an intention to be firm in righting wrongs."
Actually, 'crackdown' suggests to me an intention to be firm in wronging rights.
It doesn't actually say in the excerpt whether the 5bn is going to be recovered from the tax-avoiders, or whether that's the money that will be spent on the scheme. I think I know what they mean, but I wouldn't put it past them to set up an expensive "Office for Tax Avoidance", or a new Tsar, or something, only to recoup some fraction of the cost of setting it up.
In any case, given that the government extract nearly a thousand billion per year, it seems like a small amount to make a song and dance about.
She does know, I suppose, that tax avoidance is perfectly legal?
Maybe she means tax evasion, which is a completely different thing: what you’d be guilty of, for instance, if you sold a property and pretended it was your main residence when it wasn’t, thus evading capital gains tax.
"Maybe she means tax evasion, which is a completely different thing: what you’d be guilty of, for instance, if you sold a property and pretended it was your main residence when it wasn’t, thus evading capital gains tax."
Don't you know the rules only apply when you are in government, not opposition? According to that mega-brain David Lammy anyway.......
decnine - ha ha, from Labour it certainly does.
Peter - I wonder if she knows anyone who evaded capital gains tax in that way? Surely she wouldn't associate with anyone like that.
Sobers - I find mega-brain Lammy mildly scary. I hope his civil servants undermine him effectively.
I recall seeing Lammy make a numpty of himself on Mastermind. I reckon that, if he's been asked what his surname was, he would have hesitated, before saying "Pass".
Anyway, if someone is working abroad,and being paid locally, why should they have to pay UK tax?I
Penseivat
It appears that crude misconceptions are with us perpetually. A complete lack of understanding of human nature by the ideologues seems to be born anew with every generation. A deep flaw in the intellect of much of humanity.
Sam - it's crazy, but yes it does seem like a small amount to make a song and dance about.
Penseivat - I recall clips of Lammy's Mastermind performance, very unwise of him, but wisdom doesn't seem to be one of his characteristics.
Tammly - as if every generation has to relearn the important of human nature over ideological convenience and many never do.
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