Friday, June 2, 2017

Tax doesn't have to be taxing!

Imagine for a moment that there is a big, important job that needs doing. It’s not going to be easy and will take quite a lot of time, effort and commitment. The job is offered to two different people. They both outwardly express a willingness to take on the responsibility and get the work done, but their approach and attitude varies considerably.

Person A (can’t think of a better name but ‘Selfie Feet’ randomly springs to mind) makes their offer in this way:

“If I take on this job then I will immediately pass the buck and ensure that the real work is done by somebody else. Many people will be relying on me to do the job competently, and many will lose out when I don’t, but I don’t really care about this. The only thing that matters is that if things go well I can, by a vicarious sleight of hand, claim all the credit for myself, whereas if things go badly I will quite reasonably blame someone else. It’s all about having the opportunity to scapegoat as far as I’m concerned.”

Person B on the other hand (any number of names would work, but not Theresa, Boris or Dave. Definitely not those) has this to say:

“I’ll take on this job and take on all the responsibility for it. I’ll need some help and support from others, but hopefully once the job is done those same people will benefit from it. And when the work’s been completed you’ll have the chance to judge for yourself whether or not I did a good job.”

Who would you have more respect for? Who would you prefer to give the job to? It seems pretty clear to me that A is all about the image and the kudos, whereas B is willing to put his/her head above the parapet, get the job done and take responsibility for the outcome.

Lately I’ve had taxes on my mind (it’s all rock and roll at our house, believe me). They’ve been on my mind all the more since reading this excellent article in The Guardian. The Conservative party want to convince us all that tax is a burden and should be reduced as much as possible. They are proposing cutting corporation tax to 17%, which would be one of the lowest rates in the developed world. I think I have a basic grasp of the ideology: low tax rates are needed to attract and keep the entrepreneurs, innovators, wealth-creators and money-makers whose work benefits us all and whose absence would plunge Britain into a Third-World state of poverty and despair.

The problem is, it just doesn’t seem to be true. As the Guardian article makes clear, the wealthiest Swedes are not leaving their country in droves despite having a top income tax rate of 60%, because they understand that this gives them great state welfare and ensures that future generations receive a great education. In Germany (where their economy is even bigger than Britain’s which has THE FIFTH LARGEST ECONOMY IN THE WORLD DIDN’T YOU KNOW!!!) the rate is 30%, and their infrastructure is the envy of Europe.

So why does the Conservative party persist with this myth that tax is a bad thing? Why keep arguing and arguing that higher tax rates don’t bring any benefits when they quite clearly do, in all sorts of different ways?

Honestly I can think of only one explanation: like Person A, they just want to duck the responsibility. They want to be able to blame someone else when it all goes wrong.

Take the NHS as one example. When the whole thing is privatised and the childish, immature notion of providing good healthcare for everyone regardless of their income has finally been put to bed, the Conservatives will quite legitimately be able to blame other people for any mishaps or mistakes. “Don’t blame us!” they’ll say. “You don’t pay us any tax for this anymore! Talk to your provider. Talk to your insurance company. It’s all their fault.”

Similar things would happen in education. When we have nothing but free-schools and academy chains (and I’m very suspicious that the savage cuts are a backdoor attempt to continue the policy of getting rid of all state schools) then the government of the day will absolve themselves of all responsibility for educational standards. Shrink the state and you shrink its accountability too.

A braver government would not cut taxes. A more courageous, caring and forward-thinking government would, like Person B, say to its citizens: “We’re not passing the buck to anyone. Give us the money to do these things for you, then judge us by the results. If you don’t like what you get, then vote for someone else.”

There are lots of things to consider when we vote on June 8th. A vote for the Conservatives would, in my view, be a mistake. And one of many reasons for that is their ongoing refusal to have the guts to take responsibility.        


  1. Hi Joe, I agree with your sentiments, we have been thinking about taxes recently in our house. We have to give incomes for our working family tax credit ( theoretically a good idea) so we sit down and systematically work through the numbers and then listen to green sleeves for about 20 minutes on hold, once we get through, we patiently tell the person our precise numbers. About a week later they send us a payment schedule through with totally incorrect data, it took over a year to sort it out last time....

    1. Sounds infuriating Rob! Currently engaged in my own battle to try and get HMRC to pay me back some money that I'm convinced they owe me. Watch this space...

      I guess there are always going to be frustrations with the practicalities of collecting tax. I'm more concerned with the principle of it, to be honest. I don't really understand why many on the right of the political spectrum view it as a bad thing when we clearly reap benefits from paying it.

      Thanks for commenting.