Tax evasion and tax avoidance

At Mayors Questions this morning the Labour group asked a question about tax evasion, tax avoidance and benefit fraud, the thrust of the question being about the relative efforts made by the government in tackling each of them.

Len Duval, in asking the question, did the traditional left wing trick of trying to merge tax evasion and tax avoidance, implying that they are both the same.  I and others on the Conservative side, highlighted the fact that tax evasion and tax avoidance are completely different things, one is the illegal act of not paying taxes that are meant to be paid and the other is the perfectly legal act of not paying more tax than you are meant to pay.

When this was pointed out John Biggs started bleating on about morality, suggesting that not over-paying taxes was somehow immoral.  This goes to the heart of the left’s attitude to people’s and companies’ earnings, they believe that it all belongs to the state and it is immoral not to let the state have it.  Being a Conservative, I believe that the state should take from people and companies only what it needs in order to perform the functions that the electorate have decided it should perform.

I believe that tax evasion should be tackled and the government should make every effort to collect the taxes that are owed to them.  They should crack down on tax evasion.  If efforts want to be made to crack down on (the perfectly legal) tax avoidance then a massive simplification of the tax system would be the better way of doing it.

There is also a large degree of hypocrisy in John Bigg’s outburst.  If John has a pension, an ISA or makes use of his personal allowance he is himself engaged in tax avoidance, while I disagree with John on many issues and have called him many things I would never accuse him of being immoral.

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