Is being a tax avoider socially unacceptable?

michaels

...cos I do it, paying money into my pension and having an ISA.

Based on Milliband's rhetoric against tax avoiders should we assume Labour would move to close these 'loopholes' in the tax system?

TheBlueHorse

its utter nonsense. people should do all they can to avoid paying tax and be lauded for it. there are rules, and if you play within the rules, good for you.

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Carl31

I think people get confused by evasion and avoidance

I think these media stories of large corporations not paying tax are being taken that they are just not paying it, illegally, when in fact they are doing nothing wrong, just playing by the rulebook

Graham_Devon

I believe there is a key difference between the "everyday" tax avoidance and those that go out of their way to avoid tax.

So paying into an ISA, which is a defined scheme which th egovernment itself has created can't really be classed as tax avoidance. To class that as tax avoidance, you'd have to suggest our portion of tax free pay is also tax avoidance.

However, if, say, you set up a company that says, as a car dealer you lost £x when you've not sold a single car to anyone (and your job has nothign to do with either carsa, or indeed, sales), to avoid hundreds of thousands of pounds worth of tax.... Slightly different to putting money into an ISA.

Though both legal.

I guess my thoughts are that if you are inventing something to avoid tax, then morally it's wrong. If you are just using government designed schemes, open to all, I can't even see that that can be recognised as "avoidance".

Milliband's rhetoric was nothing to do with ISA's or Pensions.

purch

If they wrote the blimmin Tax rules properly in the first place then there wouldn't be any Loopholes to close.

Of course having the same people advising the Government whilst simultaneously advising clients how to get around that advice is not the best idea.

jjlandlord

Making a difference between "hard-working families" saving into their ISAs and large corporations is pure hypocrisy.

Everyone is equally entitled to arrange their affairs in order to legally (the key word) minimise their tax burden.

Tax law is drafted in Parliament so the buck stops there.

purch wrote: »

Of course having the same people advising the Government whilst simultaneously advising clients how to get around that advice is not the best idea.

The issue is that these are probably the people with the best understanding!

System

Graham_Devon wrote: »

I guess my thoughts are that if you are inventing something to avoid tax, then morally it's wrong.

But everything was "invented" originally. The government wanted to coax people into depositing more money in the banking system so they invented a tax-avoiding contrivance called ISAs.
They wanted to offload some of the costs of supporting people in old age so they invented a tax-avoidance scheme based on giving tax handouts to people who saved into their own pension schemes.

More recently they have encouraged the start up of new venture businesses by giving tax-free concessions to investors in small companies.

Taxation is there to raise money but also to influence people into shifting their economic behaviour in a direction the government deems desirable.
They invent the rules, they should write them properly.

michaels

Graham_Devon wrote: »

I believe there is a key difference between the "everyday" tax avoidance and those that go out of their way to avoid tax.

So paying into an ISA, which is a defined scheme which th egovernment itself has created can't really be classed as tax avoidance. To class that as tax avoidance, you'd have to suggest our portion of tax free pay is also tax avoidance.

However, if, say, you set up a company that says, as a car dealer you lost £x when you've not sold a single car to anyone (and your job has nothign to do with either carsa, or indeed, sales), to avoid hundreds of thousands of pounds worth of tax.... Slightly different to putting money into an ISA.

Though both legal.

I guess my thoughts are that if you are inventing something to avoid tax, then morally it's wrong. If you are just using government designed schemes, open to all, I can't even see that that can be recognised as "avoidance".

Milliband's rhetoric was nothing to do with ISA's or Pensions.

He criticised the Tory guy for saying 'everyone is a tax avoider'....and yet surely using an ISA is 'avoiding tax'?

All our cash savings our in my wife's name as she pays a lower tax rate, is this good avoidance or bad avoidance?

Other savings are in ISAs, good or bad avoidance?

I pay into my pension not just to avoid tax but aso because it means I qualify for child benefit, good or bad avoidance?

As Graham mentions I get childcare vouchersto pay for part of my kids cildcare from my gross salary, good or bad avoidance?

The govt have various schemes where for example investing in movies allows enhanced write-offs for tax to encourage the industry, good or bad avoidance?

The govt offers tax breaks for companies that take on apprentices, good or bad avoidance?

Graham_Devon

Clifford_Pope wrote: »

But everything was "invented" originally. The government wanted to coax people into depositing more money in the banking system so they invented a tax-avoiding contrivance called ISAs.

I didn't really mean inventing a new product. I meant being creative and inventing a situation to avoid paying the tax you would otherwise owe.

Chris Moyles for instance and his car dealership business which never sold a single car etc....

Graham_Devon

michaels wrote: »

He criticised the Tory guy for saying 'everyone is a tax avoider'....and yet surely usign an ISA is 'avoiding tax'?

All our cash savings our in my wife's name as she pays a lower tax rate, is this good avoidance or bad avoidance?

Other savings are in ISAs, good or bad avoidance?

I pay intop my pension not just to avoid tax but aso because it means I qualify for child benefit, good or bad avoidance?

The govt have various schemes where for example investing in movies allows enhanced write-offs for tax to encourage the industry, good or bad avoidance?

The govt offers tax breaks for companies that take on apprentices, good or bad avoidance?

As I suggested, my take on it would be that if you are using the products which the government are offering, theres nothing wrong.

You could say buying childcare vouchers through your employer is tax avoidance too.

But people like yourself using an ISA is hardly the same as routing money through several different channels, authorities, districts and tax regimes etc in order to "minimise" your profits, or avoid being taxed under the UK regime.

I honestly don't think people are that confused by what Milliband or others are saying. Looking at ISA's simply extends things to the extreme...

The point, in context, that Milliband was making was quite clear, allbeit not very well made. It was wrong for the bloke to state everyone is a tax avoider in the context of what was being discussed. All this stuff about ISA's etc is not in context with the original point.

Out,_Vile_Jelly

I'm not sure you can compare pensions and ISAs with large scale corporate tax dodging.

Tax-free saving is designed to encourage people to think long term and save for their future. I'm sure we can all agree that with an ageing population less dependency on the State is helpful all round. Corporate tax dodging benefits a select few already-rich share-holders and makes the pot smaller for everyone.

I find those that consider it a "duty" to avoid tax where at all possible, and who defend the likes of Gary Barlow, are the first to moan about the local schools and that they can't have free IVF on the NHS.

For the record, I've been offered lower prices for cash payment for tradie jobs in my house, and I always pay properly. I work in a publicly-funded sector (university); why would I want to make cuts and redundancies more likely?