Wednesday, 30 March 2011

Another £25 billion lost to us?

"Some £25bn every year is thought to be lost to the public purse by wealthy tax avoiders. This money needs to be recouped to help save our essential public services."

This is the claim of the 'demonised' UK Uncut organisation which occupied Fortnum and Mason last Saturday, 26th March.

Whether this figure is exactly correct or not, it is perfectly clear that the wealthiest people pay the least tax in UK.  If they accidentally paid as much tax as I do (in £, not in %) I suspect they would probably sack their accountants.

(Am I ranting too much on a single topic this week?  Leave a comment if you think I should return to my usual rants - or indeed if you think this stuff matters a lot.)

6 comments:

Anonymous said...

The evidence demonstrates the reverse. A small minority are paying most of our tax.

Plasma Engineer said...

I don't see your point. Yes I know that a small number of us pay the tax. It is the super-rich who should be paying tax who avoid it.

Anonymous said...

No, if the top 1% stopped paying tax the rest of us would each have to pay about 50% more than we do now.

Its easy for the top 1% to leave the UK.

Derby Sceptic said...

Anonymous - the point that I believe Plasma Engineer is making is that those right at the top are avoiding paying the tax they should so the rest of us have to top up the shortfall.

This is done by a number of schemes, some of which are legal but morally suspect, others I am sure a simply illegal. I have no doubt if I were in that wealth category, there would be no end of 'tax advisers' telling me the best ways to avoid tax!

Derby Sceptic said...

Anonymous - I read in the paper today that Ken Livinstone has been identified as using such techniques by processing income via a company set up for this purpose so he pays 20 percent corporation tax rather than 40 percent income tax. Legal but!!!

Anonymous said...

The £25bn figure reported has nothing to do with tax avoidance. UKuncut simply jumped on a number reported by the Public Accounts Committee without considering the source material.

HMRC accounts show that it's tax under consideration, not avoidance. This could be anything from a claim for vaccine research relief (for research into treatments for malaria, tb or HIV), research and development relief, capital allowance claims to something more aggressive, such as a controlled foreign company, transfer pricing or thin capitalisation avoidance issue.

To call it all avoidance is like calling the entire welfare state bill fraudulent.