SO George Osborne’s family firm hasn’t paid corporation tax in seven years, and no-one is remotely surprised. Of course his lot, of all people, would have been able to find a way around it – in this case by rolling over losses and deferring tax payments. All above board, I’m sure, but then so is a lot of tax avoidance. It was only the aggressive kind – as opposed to the polite, quiet variety – that the Chancellor described as “morally repugnant” in his 2012 Budget speech.
It’s easy to focus on Osborne’s apparent hypocrisy, not least because it distracts attention away from that of the rest of us. Because as much as we Scots like to remind everyone that we’re more left-wing than the rest of the UK, we’re less keen to put our money where our mouths are. Ask the man in the street if he thinks someone else should pay more tax and he’ll likely agree. Tell him he’ll have to play his part too and there’s a good chance he’ll change his tune.
As much as we Scots like to remind everyone that we’re more left-wing than the rest of the UK, we’re less keen to put our money where our mouths are
It’s little wonder Scottish Labour have tried – however ham-fistedly – to challenge the SNP by proposing an increase to income tax. There are only so many times you can use the word “progressive” to favourably contrast yourself with the Tory UK Government before someone tries to call your bluff. It’s worth setting aside the fact that Kezia Dugdale’s attempt has the feel of a plan inked onto a napkin by a student at the end of a late-night session of setting the world to rights. She’s no chance of implementing it any time soon so the fine print doesn’t really matter, but the principle does. Who wants to pay more tax? Can we have a show of hands?
I’m sure everyone can come up with a good reason why they, specifically, shouldn’t have to. Perhaps you consider yourself part of the “squeezed middle” because you’ve been obliged to switch to Lidl for your weekly shop (seriously though, have you seen the price of a tin of tuna these days?) Perhaps you earn more than the average salary but don’t feel rich because you live beyond your means – or “support the economy”, as you prefer to put it. Perhaps, in fairness, you work really bloody hard in a thankless mid-level job while juggling caring duties and health problems that make your outgoings unavoidably high. But if you aren’t theoretically willing to pay a bit more – or even just forgo the tax cut you receive every time the personal allowance goes up – then you can’t really complain that others won’t.
Of course, there are many taxes – some devolved, some reserved – and it’s fair to argue that no amount of tinkering with tax on earnings will ever eliminate inequality when there’s so much unearned wealth in the mix. But here’s where things stop making sense. Talk to many ordinary people about inheritance tax and you’d think they were imagining that Osborne himself was going to appear alongside the Grim Reaper and start rummaging around under the mattresses of their death beds. God forbid the “tax man” should pick the pockets of a shroud, then insult the memory of the deceased by frittering the contents away on schools, hospitals, benefits and the like. The fact that most people stand no chance of inheriting a sum that exceeds the threshold seems to matter no a jot. By 2020 that threshold will be half a million pounds, and if granny’s house is worth twice as much then hey, for old time’s sake someone can have it for free. A million-pound house. If the SNP have a fairer system in mind for an independent Scotland, they forgot to mention it in their White Paper.
Talk to many ordinary people about inheritance tax and you’d think they were imagining that Osborne himself was going to appear alongside the Grim Reaper and start rummaging around under the mattresses of their death beds
Of course, one way to dispose of the cash you worked hard to put away in your lifetime – along with any you got as a consolation prize when a loved one kicked the bucket – is to leave it to charity. That way you’ll be able to help level the playing field both by denying anyone an unearned boost and by supporting a good cause of your own choosing. Better still, you could donate during your lifetime and use Gift Aid to claw back 25p in the pound from the government coffers. Because hey, it’s not like the government would have used any of that tax revenue to directly fund charities. You know best – you spend it. Don’t worry about the £1 billion (and counting) cost to the public purse. They’ll be cracking down on those tax havens soon, surely, so it’s bound to balance out.
Ultimately, the problem here may be the tax man himself, and his dreadful public image. Most people like the idea of things like universal education and healthcare, effective emergency services, state pensions and foreign aid, but no-one likes the tax man. By definition he can’t be trusted with the public purse, and his combination of greed and incompetence is the reason why it’s OK to do a bit of cheeky cash-in-hand work in between blogging about radical socialism. If Scotland is to have a proper conversation about tax then all talk of this mythical creature should cease immediately and a positive alternative should be provided. A tax unicorn, perhaps, would suit Scotland. Surely no-one would wish to deny the tax unicorn the means to make the country a fairer, better place.
A version of this article first appeared in The National.
Are you willing to pay more tax to make Scotland a fairer place?
Which taxes would you raise if you were in power?
Let me know in the comments!