This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.theguardian.com/commentisfree/2017/nov/07/paradise-papers-bankrupt-social-order-tax-avoiders
The article has changed 11 times. There is an RSS feed of changes available.
| Version 6 | Version 7 |
|---|---|
| Tax avoidance may be legal but it’s bankrupting our social order | Tax avoidance may be legal but it’s bankrupting our social order |
| (about 17 hours later) | |
| In the coming days, you will hear this response from the defenders of our rotten status quo. “What the Paradise Papers has exposed is legal, so what is the problem?” They have an agenda, of course. They want to demonise the very concept of taxation because they want to roll back the state and construct a free-market “utopia” which, in practical terms, would be dystopian for the vast majority. | In the coming days, you will hear this response from the defenders of our rotten status quo. “What the Paradise Papers has exposed is legal, so what is the problem?” They have an agenda, of course. They want to demonise the very concept of taxation because they want to roll back the state and construct a free-market “utopia” which, in practical terms, would be dystopian for the vast majority. |
| Let’s unpick this argument. Using sophisticated loopholes to avoid tax on an industrial scale is a choice, a conscious decision, that an individual or business has to take. Many choose not to. Lewis Hamilton was born safely in Lister Hospital in Stevenage, courtesy of the state-funded NHS. He was then educated by the state at great expense. Throughout his life, he has used state-funded roads and rail tracks, has been protected by the state’s police forces and fire brigades, and no doubt employed the services of accountants who used their state-funded university degrees to locate loopholes in the tax system for him. He has repaid his gratitude to his country by choosing to avoid paying European taxes on his £16.5m jet. | Let’s unpick this argument. Using sophisticated loopholes to avoid tax on an industrial scale is a choice, a conscious decision, that an individual or business has to take. Many choose not to. Lewis Hamilton was born safely in Lister Hospital in Stevenage, courtesy of the state-funded NHS. He was then educated by the state at great expense. Throughout his life, he has used state-funded roads and rail tracks, has been protected by the state’s police forces and fire brigades, and no doubt employed the services of accountants who used their state-funded university degrees to locate loopholes in the tax system for him. He has repaid his gratitude to his country by choosing to avoid paying European taxes on his £16.5m jet. |
| 1) Millions of pounds from the Queen’s private estate has been invested in a Cayman Islands fund – and some of her money went to a retailer accused of exploiting poor families. | 1) Millions of pounds from the Queen’s private estate has been invested in a Cayman Islands fund – and some of her money went to a retailer accused of exploiting poor families. |
| 2) Prince Charles’s estate made a big profit on a stake in his friend’s offshore firm. | 2) Prince Charles’s estate made a big profit on a stake in his friend’s offshore firm. |
| 3) Extensive offshore dealings by Donald Trump’s cabinet members, advisers and donors, including substantial payments from a firm co-owned by Vladimir Putin’s son-in-law to the shipping group of the US commerce secretary, Wilbur Ross. | 3) Extensive offshore dealings by Donald Trump’s cabinet members, advisers and donors, including substantial payments from a firm co-owned by Vladimir Putin’s son-in-law to the shipping group of the US commerce secretary, Wilbur Ross. |
| 4) Twitter and Facebook received hundreds of millions of dollars in investments that can be traced back to Russian state financial institutions. | 4) Twitter and Facebook received hundreds of millions of dollars in investments that can be traced back to Russian state financial institutions. |
| 5) The tax-avoiding Cayman Islands trust managed by the Canadian prime minister Justin Trudeau’s chief moneyman. | 5) The tax-avoiding Cayman Islands trust managed by the Canadian prime minister Justin Trudeau’s chief moneyman. |
| 6) The Formula One champion Lewis Hamilton avoided taxes on a £17m jet using an Isle of Man scheme. | 6) The Formula One champion Lewis Hamilton avoided taxes on a £17m jet using an Isle of Man scheme. |
| 7) A previously unknown $450m offshore trust that has sheltered the wealth of Lord Ashcroft. | 7) A previously unknown $450m offshore trust that has sheltered the wealth of Lord Ashcroft. |
| 8) Oxford and Cambridge and top US universities invested offshore, with some of the money going into fossil fuel industries. | 8) Oxford and Cambridge and top US universities invested offshore, with some of the money going into fossil fuel industries. |
| 9) The man managing Angola’s sovereign wealth fund invested it in projects he stood to profit from. | 9) The man managing Angola’s sovereign wealth fund invested it in projects he stood to profit from. |
| 10) Apple secretly moved parts of its empire to Jersey after a row over its tax affairs. | 10) Apple secretly moved parts of its empire to Jersey after a row over its tax affairs. |
| 11) How the sportswear giant Nike stays one step ahead of the taxman. | 11) How the sportswear giant Nike stays one step ahead of the taxman. |
| 12) The billions in tax refunds by the Isle of Man and Malta to the owners of private jets and luxury yachts. | 12) The billions in tax refunds by the Isle of Man and Malta to the owners of private jets and luxury yachts. |
| 13) Offshore cash helped fund Steve Bannon's attacks on Hillary Clinton. | 13) Offshore cash helped fund Steve Bannon's attacks on Hillary Clinton. |
| 14) The secret loan and alliance used by the London-listed multinational Glencore in its efforts to secure lucrative mining rights in the Democratic Republic of the Congo. | 14) The secret loan and alliance used by the London-listed multinational Glencore in its efforts to secure lucrative mining rights in the Democratic Republic of the Congo. |
| 15) The complex offshore webs used by two Russian billionaires to buy stakes in Arsenal and Everton football clubs. | 15) The complex offshore webs used by two Russian billionaires to buy stakes in Arsenal and Everton football clubs. |
| 16) Stars of the BBC hit sitcom Mrs Brown's Boys used a web of offshore companies to avoid tax. | 16) Stars of the BBC hit sitcom Mrs Brown's Boys used a web of offshore companies to avoid tax. |
| 17) British celebrities including Gary Lineker used an arrangement that let them avoid tax when selling homes in Barbados. | 17) British celebrities including Gary Lineker used an arrangement that let them avoid tax when selling homes in Barbados. |
| 18) Prominent Brexit campaigners have put money offshore. | 18) Prominent Brexit campaigners have put money offshore. |
| 19) An ex-minister who defended tax avoidance has a Bahamas trust fund. | 19) An ex-minister who defended tax avoidance has a Bahamas trust fund. |
| 20) The Dukes of Westminster pumped millions into secretive offshore firms. | 20) The Dukes of Westminster pumped millions into secretive offshore firms. |
| 21) A tax haven lobby group boasted of 'superb penetration' at the top of the UK government before a G8 summit that was expected to bring in greater offshore transparency. | 21) A tax haven lobby group boasted of 'superb penetration' at the top of the UK government before a G8 summit that was expected to bring in greater offshore transparency. |
| 22) The law firm at the centre of the Paradise Papers leak was criticised for 'persistent failures' on terrorist financing and money laundering rules. | 22) The law firm at the centre of the Paradise Papers leak was criticised for 'persistent failures' on terrorist financing and money laundering rules. |
| 23) Seven Republican super-donors keep money in tax havens. | 23) Seven Republican super-donors keep money in tax havens. |
| 24) A top Democratic donor built up a vast $8bn private wealth fund in Bermuda. | 24) A top Democratic donor built up a vast $8bn private wealth fund in Bermuda. |
| 25) The schemes used to avoid tax on UK property deals. | 25) The schemes used to avoid tax on UK property deals. |
| 26) The celebrities, from Harvey Weinstein to Shakira, with offshore interests. | 26) The celebrities, from Harvey Weinstein to Shakira, with offshore interests. |
| 27) How a private equity firm tried to extract £890m from a struggling care home operator by making it take out a costly loan. | 27) How a private equity firm tried to extract £890m from a struggling care home operator by making it take out a costly loan. |
| 28) Trump’s close ally Robert Kraft, the New England Patriots owner, is the longtime owner of an offshore firm. | 28) Trump’s close ally Robert Kraft, the New England Patriots owner, is the longtime owner of an offshore firm. |
| 29) One of the world’s biggest touts used an offshore firm to avoid tax on profits from reselling Adele and Ed Sheeran tickets. | |
| Those who crow about the “legality” of tax avoidance are, of course, being disingenuous. The state has not passed laws permitting certain schemes in the same way that it has, for example, allowed the legal sale of alcohol. This level of tax avoidance requires an encyclopaedic knowledge of tax and the law, and extraordinary amounts of cunning, pedantry and sophistication. You are, after all, trying to find loopholes and grey areas that lawmakers did not intend; you are going against the spirit, if not the letter, of the law. This is why you need extraordinarily expensive accountants, who the vast majority of individuals and businesses cannot afford to use. | Those who crow about the “legality” of tax avoidance are, of course, being disingenuous. The state has not passed laws permitting certain schemes in the same way that it has, for example, allowed the legal sale of alcohol. This level of tax avoidance requires an encyclopaedic knowledge of tax and the law, and extraordinary amounts of cunning, pedantry and sophistication. You are, after all, trying to find loopholes and grey areas that lawmakers did not intend; you are going against the spirit, if not the letter, of the law. This is why you need extraordinarily expensive accountants, who the vast majority of individuals and businesses cannot afford to use. |
| Most workers are on PAYE, and cannot deviously exploit loopholes to slash their tax deductions. Small businesses will find HM Revenue and Customs knocking on their door pretty promptly if they mess up their tax forms, and are being driven out of business by tax-avoiding corporate giants. No, this form of tax avoidance is the preserve of a super-rich who can afford to subvert the law’s intentions. And without state-funded infrastructure, education, healthcare, research, in-work benefits, law and order, or a banking system saved at enormous cost by the state, you name it, no individual or business can make money. Tax avoiders thrive at the expense of a state they refuse to adequately contribute to. | Most workers are on PAYE, and cannot deviously exploit loopholes to slash their tax deductions. Small businesses will find HM Revenue and Customs knocking on their door pretty promptly if they mess up their tax forms, and are being driven out of business by tax-avoiding corporate giants. No, this form of tax avoidance is the preserve of a super-rich who can afford to subvert the law’s intentions. And without state-funded infrastructure, education, healthcare, research, in-work benefits, law and order, or a banking system saved at enormous cost by the state, you name it, no individual or business can make money. Tax avoiders thrive at the expense of a state they refuse to adequately contribute to. |
| As it so happens, two law professors have reportedly described Hamilton’s scheme as potentially “abusive”, with one suggesting that existing laws are not being enforced. This, I feel, gets to the nub of the issue. The state is punitive when it comes to, say, benefit | As it so happens, two law professors have reportedly described Hamilton’s scheme as potentially “abusive”, with one suggesting that existing laws are not being enforced. This, I feel, gets to the nub of the issue. The state is punitive when it comes to, say, benefit |
| fraudsters or thousands of young people criminalised for arbitrarily banned drugs, but uses kid gloves when it comes to our shameless uber-wealthy elite. The colossally destructive behaviour of the rich is permitted; the infractions of the poor are deemed intolerable. | fraudsters or thousands of young people criminalised for arbitrarily banned drugs, but uses kid gloves when it comes to our shameless uber-wealthy elite. The colossally destructive behaviour of the rich is permitted; the infractions of the poor are deemed intolerable. |
| The Paradise Papers underline, once again, the sheer rottenness, injustice, immorality and bankruptcy of our social order. One rule for those at the top, another for everyone else. Relentless austerity for hundreds of millions across the west, justified on the basis of “there is no money”, while a grotesquely rich elite hoard their wealth away in tax havens. We can’t tinker with this system, it has to be replaced. A democratic revolution is surely coming in the western world, and this shameless, decadent elite only have themselves to blame. | The Paradise Papers underline, once again, the sheer rottenness, injustice, immorality and bankruptcy of our social order. One rule for those at the top, another for everyone else. Relentless austerity for hundreds of millions across the west, justified on the basis of “there is no money”, while a grotesquely rich elite hoard their wealth away in tax havens. We can’t tinker with this system, it has to be replaced. A democratic revolution is surely coming in the western world, and this shameless, decadent elite only have themselves to blame. |
| • Owen Jones is a Guardian columnist | • Owen Jones is a Guardian columnist |