Tax dodging MPs

[motorbiking]

and not Conservatives for a change...

Westminster Accounts: Lib Dem leader and ex-cabinet minister among MPs 'avoiding taxes' on second jobs

Lib Dem leader Sir Ed Davey and ex-environment secretary Ranil Jayawardena are two of 24 MPs who were paid for work outside parliament through companies set up and controlled by themselves or their family.

news.sky.com

But when you read in to it, I think the tax dodge claim is a bit unfair. if you occasionally do bits of side work, no matter what you charge, you can hardly expect to go on the payroll for a few days. It makes sense to create a business for this. The fact is all business owners have the ability to pay dividends, RSUs etc. to reduce tax.

 

[Ihavenojob]

Tax avoidance is not illegal. If you have money in an ISA you are avoiding tax on the interest.

 

[JohnD]

The fact is all business owners have the ability to pay dividends, RSUs etc. to reduce tax.

As you say, the tax laws have been deliberately written to bear more heavily on people who are employed and work for a living, than on people who receive dividend income.

Being lawful, and being fair, are of course, not the same thing.

 

[ajohn]

The mention of liquidated and wife owned has it's interesting aspects. What these companies actually do may also be interesting. Why - a popular idea that has been used in business, A manager has a workforce, There are various ways that a workforce can be managed so try one. Then increase income by lecturing other managers concerning what the effects were. A little like think tanks and very similar to consultancy businesses.

Travel could have it's interesting aspects as well. Find a bit of gov work to do somewhere and while there do something else. Something I wondered about when our USA ambassador mentioned many visits to talk to right wing think tanks. Are they paying for these trips themselves and should they? It's party political business note exactly gov business.

 

[motorbiking]

As you say, the tax laws have been deliberately written to bear more heavily on people who are employed and work for a living, than on people who receive dividend income.

Being lawful, and being fair, are of course, not the same thing.

To be fair everyone has the same allowances.

Any builder can do the same. It surprises me that more corporations don’t issue bonuses as stock with buy backs to help employees leverage capital allowances. It only really makes a difference to higher taxed individuals.

 

[JohnD]

It only really makes a difference to higher taxed individuals.

Although you'll remember me demonstrating that dividend generosity made a substantial difference to people on an income of £50,000 p.a. So not higher tax.

It's very surprising that the tax laws favour the rich.

Isn't it?

 

[motorbiking]

I’d expect tax laws to be structured around the way people can be taxed. It make sense to focus on those who pay it. Those earning 50k + pay the vast majority of tax.

 

[JohnD]

No, it makes sense to focus on the people who've got most of the money, especially those of them who pay the least tax.

And yet tax laws, and enforcement, treat them the most generously.

Unsurprisingly, they are horrified at any suggestion that this might need to change.

 

[Mottie]

It makes sense to focus on the people who've got most of the money.

And yet tax laws, and enforcement, treat them the most generously.

Unsurprisingly, they are horrified at any suggestion that this might need to change.

I recall you mentioning dividend payments on your investments. Do you make use of your national insurance exemption, dividend tax free allowance and dividend tax rate?

 

[motorbiking]

No, it makes sense to focus on the people who've got most of the money, especially those of them who pay the least tax.

And yet tax laws, and enforcement, treat them the most generously.

Unsurprisingly, they are horrified at any suggestion that this might need to change.

I welcome your thoughts on how to tax these highly mobile, wealthy people without it resulting in them upping sticks and moving to a more generous tax regime.

More now than any other time people can base themselves in low tax countries and hold down European jobs.

I work with many clients based in Dubai and SA performing U.K. jobs with ease. Post covid working practices have made this easier.

 

[JohnD]

how to tax these highly mobile, wealthy people without it resulting in them upping sticks and moving to a more generous tax regime.

You mean like Russian oligarchs and their wives and families? Phillip Green and Lord Rothermere? The Bra Baroness? Ex Prime Minister Johnson?

They want to live in a place with posh shops and restaurants, elite schools and universities for their offspring, opera houses and art galleries, yacht marinas and private airfields. A fire service that will help them if their palace catches fire. Public health that prevent their servants catching plague. Even safe roads. So the sort of place where people pay taxes.

And a relatively benign and non-corrupt political system and police force, and gun control. They don't want go be robbed, gunned down or kidnapped for ransom, or to have their wealth confiscated at whim.

They like to say they'll move if they are required to pay tax.

If they aren't paying tax we don't need them.

 

[JohnD]

To be fair everyone has the same allowances.

Employed people such as nurses, postmen, railway workers, Tesco shelf stackers and bus drivers do not get their earnings slid under the counter as dividends. Nor do police and customs officers. The person behind the till in your petrol station. Nor vicars, or courtroom ushers. The sort of everyday, ordinary people who keep the country running and are essential.

Retired people on pensions pay tax.

So, no, everyone does not benefit from the same schemes designed to favour the prosperous at the expense of ordinary working people

Every pound of tax dodged by a billionaire is a pound that has to be paid by somebody far poorer, or a pound off our public services.

 

[JohnD]

"We're all in this together

...aren't we?

David Cameron claimed to be a champion of transparency over offshore tax dodging. Now we know the truth

The suspicion must be that the need to protect wealthy Tory donors prompted British opposition to the EU plan to crack down on offshore trusts. Forget his father's tax affairs, this is major embarrasment for the Prime Minister

www.independent.co.uk

"The suspicion will be that such a move would have impacted most on wealthy Tory donors and supporters and it was that which prompted British opposition to the European plan."

And, no, you can't say "not the Conservatives this time."

 

[motorbiking]

People earning £19,200 (bottom 25%) or less pay less than 10% of all income tax. People earning 44,100 or more (top 25%) pay over 55% of all income tax. The tope 5% pay more than 1/4 of all income tax.

Many of the above public sector workers enjoy huge pension tax breaks not available to private sector workers and religions ministers also have tax breaks from council tax to hybrid employment.

You seem to be happy for the top 1% to leave the country if they are made to pay more tax. Are you aware that would leave a £180bn income tax hole?

Every pound of tax dodged by a billionaire is a pound that has to be paid by somebody far poorer, or a pound off our public services.

So this is untrue.

 

[JohnD]

There is no reason to suppose that all the rich people would flee the country if our tax system became less unfair.