Search This Blog

Sunday 10 April 2022

Tax shouldn't be Taxing.

I pay tax. I have all my adult life - PAYE. Income tax applies to most types of income, salary, profit & pensions. There are State benefits which are income that is not taxed. Income tax is the government's main source of revenue and is collected by HMRC on their behalf. The government uses the revenue from income tax to provide funding for public services such as the NHS, Education, Welfare & Roads. So far so good. I'm happy to pay for vital services & help people who aren't as fortunate as I am. The fact that I don't have children in the education system doesn't mean that I shouldn't pay for the service. Currently the biggest spend increase will be on net debt interest.

There are also approximately 100 other taxes in the UK - Corporation Tax, Capital Gains Tax, VAT, Stamp Duty Land Tax and Inheritance Tax – they affect us at some time in most walks of life. There are other not so obvious ones that still affect our daily lives: petrol, beer, Insurance Tax, Travel Tax......There are anomalies, biscuits and cakes are deemed as necessities and are not subject to VAT. Chocolate covered biscuits however, are luxury goods and taxed at 20%. Toasted sandwiches are fixed with a 20% tax charge but toasted bagels and baguettes are exempt.

 https://i.dailymail.co.uk/i/pix/2014/11/02/1414971990381_Image_galleryImage_where_the_money_graph_JPG.JPG

https://www.statista.com/chart/4520/where-do-uk-taxes-go/

We have been printing money we don't have, euphemistically called "quantitative easing". We used to have gold reserves to back printing money, but we sold half off between 1999 - 2002 costing tax payers approximately £7 billion. The money was invested in foreign currency deposits. I'm not a financial whizz, so I don't know how good or bad this decision was. All I know is that if I pay for something on my credit card I need to have the cash in my account to cover it.

The thing I do object to is that the money that is taken from me is used for things that I do not agree with & is wasted by an incompetent Government. A Govenrment that says it does not have a "magic money tree", but finds billions to spend on the arms industry & wars whilst taking money out of the overseas aid budget. Replacing the Trident nuclear weapons system will cost £205 billion.  A government which hands out contracts worth millions to dubious companies providing useless PPE for the Covid epidemic. A government that is not scrutinised & regulated effectively.

When I read that the obscenely wealthy can evade tax through admittedly lawful, but immoral tax dodges I'm afraid my blood boils. It's called Corporate tax avoidance. Complex financial structures, which take profits offshore and the use of tax loopholes means some of the biggest companies in the UK can get away with paying next to no tax. Just so you comprehend what I'm talking about, a £billion is one thousand million pounds! Accumulating this amount of wealth is often, but not always, hinged on the legal exploitation of people or resources. By paying workers low wages, without comfortable working conditions, companies, and by virtue their owners, can maximise their profits. In 2018, the top five tech companies operating in the UK collectively made tidy profits of £8.1bn. They paid just £237m: an effective tax rate of 2.9 per cent. Corporation tax, paid by most UK companies, is 19 per cent. Tax avoidance is legal, tax evasion is illegal.

https://inews.co.uk/inews-lifestyle/money/ethical-money/billionaires-rise-time-super-rich-pay-fair-share-tax-1208626

I have been told, but can't veryify, that big UK Accountancy companies like Ernst & Young, Deloitte & Touche, Arthur Andersen, KPMG, Price Waterhouse Coopers, actually advise HMRC on tax legislation & then advise companies & individuals on ways to evade paying tax. If that is true it is utterly unacceptble. Tax is so complicated very few people actually really understand it.

Governments have been saying for years that the tax system is broken, over complicated & needs complete overhaul. But no one has done it. Currently it is discriminating against people on low or no incomes & favouring the extremely wealthy. 

Why are we tolerating that?


 

 



 

No comments:

Post a Comment