Sunday, October 25, 2020
Home News Paul T Horgan: This socialist song and dance over ‘fair’ taxation

Paul T Horgan: This socialist song and dance over ‘fair’ taxation

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Language, as George Orwell highlighted in his works, is political, and never more so than with taxation.

When Chancellors cut taxes, their opponents accuse them of giving money away, or enriching those whose taxes are cut. This is not true. The state is taking less money in tax. People are allowed to keep more of their money. Socialists seem to believe that all money is the property of the state and that if some people have large quantities of money, it is the ‘duty’ of the state to confiscate this and redistribute it to those who have less in the name of ‘equality’. The fact that someone has worked hard for the money, or arranged their affairs so as to possess a large amount of money is, to the collectivists, irrelevant. No one is allowed to be richer than anyone else. Of course under socialism some people, regime loyalists, always have greater entitlement to goods and services than others, or they might know the right people. This socialism is unfair, just unfair in a manner unrelated to actual achievement or participation in the economy.

There is also the issue of tax avoidance. There is actually no such thing. Tax avoidance is a term confected by statists that has entered general use. People and legal entities either pay the taxes they owe to the state or they do not. There is either compliance or evasion. A subset of compliance is ‘gaming the system’, devising financial schemes with the sole function of minimising tax liability. Until recently, these were legal.

People had a right to minimise their tax liability. However this changed following the 2008 crash, when the subsequent coalition government found itself short of money and the traditional sources of revenue had dried up. The incorrectly titled General Anti-Avoidance Rule was instituted to stop the cat-and-mouse game in which rules designed to incentivise sections of the economy were exploited as loopholes.



There is a bit of a song and dance going on about some revelations concerning tax-minimising schemes. There are complaints that some people have not paid their ‘fair share’ in taxes. This is another fiction. There is no such thing as a ‘fair share’ of taxes. People and entities pay what they owe, fair or not. If they do not pay, they are evading tax, which is illegal.

There is also no social duty element in the payment of taxes. Taxes are an obligation. If people believe that there is a moral imperative to the payment of taxes, as these are used to fund social services, it is unusual that this imperative stops at the last penny of tax due to the state. I have yet to see a well-heeled welfarist paying more money to the Exchequer than they owe. The tax bill is actually the minimum amount that the state requires from an individual or entity.

There are people who leave money in their will to help alleviate the national debt. None of them is a socialist. If socialists believe so much in the benevolent power of the state, it seems strange they do not wish to augment that power through donation. It is more likely that socialists believe in the malevolent power of the state to punish achievers and appropriate wealth to be handed off to their supporters or to bribe an electorate.

Socialists also seem to believe that no money should be allowed to pass in inheritance from one generation to another. I have yet to see a socialist give away all their money rather than pass it on to their children, after taxes. Tony Benn and Ralph Miliband both used schemes to maximise how much their offspring could inherit.
The political posturing by socialists is bogus and is aimed at the hard-of-thinking. If it is found that individuals or entities have evaded tax or gamed the tax system, they will have to pay up. Otherwise, their arrangements are completely legal. There is no moral dimension. Tax is not moral. So far, there has been no indication that there has been any wrongdoing. All that appears to have happened is that some rich people have been arranging their financial affairs in a lawful fashion. Given that socialists hate all rich people, they are merely attacking those identifying as well-off for having that identity. This is just envy and bigotry dressed up as bogus virtue. Socialists are being socialists.

If people want to be rich, they need to work for their money and be rewarded for their achievements. Being enriched on the back of money confiscated by social bigots is just fool’s gold. Sooner or later the socialists will run out of someone else’s money. Just ask any starving Venezuelan.

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Paul T Horgan
Paul T Horgan works in the IT Sector. He lives in Berkshire.

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