So once more tax is in the news and the world and their dog seems to up in arms about people “avoiding” tax. Tax avoidance seems to currently be the fashionable thing to hate and who cares about the law or justice. Many people have said it before but it seems it’s worth repeating, tax evasion is illegal and naughty, tax avoidance is legal and is actually sometimes used by the state to encourage certain behaviors. The Government wanted more people to invest in film making so they gave tax relief to people that invested in films. So the government wanted people to avoid tax by investing in the films. The EU is designed so that companies only pay tax once in the EU, it is designed so that companies don’t pay tax everywhere they do business but only in the country of their choosing. This is deliberate. So if we want to stop people being tax efficient (as it used to be called) then we should be asking the Government to change the tax laws rather than attacking companies for obeying the law. It is also worth noting that the UK has the most complex tax system in the world, which isn’t exactly conducive to efficient tax collection. All of which brings me to the point I was stumbling towards, Mr. Fink recently got taken to task by the press for describing his arrangements as “vanilla tax avoidance”, which caused much amusement for some comedians. Apparently we should all be paying our bit (whatever that means), so if you agree with that and the general anti-tax avoidance zeitgeist then if you’ve ever done any of the following you better stump up to the treasury, because you’ve been avoiding tax:
- Bought things on a buy one get one free offer
- Joined a work place pension scheme
- Taken advantage of a bike to work scheme
- Bought an environmentally friendly car
- Made home brew
- Grown and smoked your own tobacco
- Sold something on e-bay without declaring it
- Paid or been paid cash in hand without declaring it
- Collected wood to burn in a stove
- Given to charity as part of a payroll giving scheme
- Upcycled anything
- Baked your own cakes, made sweets
- Made your own clothes
- Been on a booze cruise
- Ordered anything from a country within the EU with a lower tax rate
- Ordered goods from outside the EU without paying import and related taxes
That will do you for starters. Yes some of them are “normal” behaviors – but for example if you’d gone to a shop to buy that cake rather than make it yourself you’d have paid VAT. So by making your own cake – congratulations you’ve avoided paying tax. I’m sure I’ve missed loads of other ways we can all avoid paying “our fair share” – do please let me know any I’ve missed in the comments. Now I’m off to avoid more tax by cooking my own meal rather than eating out.
