THE PRISONS AREN’T BIG ENOUGH
Banking offshore isn’t, in itself, illegal. Luckily for some. Ronen Palan is Professor of International Politics at City University London and an expert in offshore tax havens. He told me that, if you were to wander into a hypothetical party in Mayfair and kick out everyone who banks offshore, the room would empty.
THE TAX AVOIDANCE INDUSTRY IS MASSIVE
While tax evasion (cheating the tax authority by not declaring assets or misrepresenting information) is a criminal offense in the UK, tax avoidance (using a legal scheme to reduce your tax) is legal. A huge, lucrative industry is built around it.
WE’RE BUSY CHASING BENEFITS CHEATS
HMRC claims (rightly) that prosecuting high-earning tax cheats is time-consuming and costly. Instead, it often comes to an arrangement out of court. However, the disparity between resources devoted to catching benefits cheats and wealthy tax dodgers is kind of conspicuous.
BECAUSE: THE IMPORTANT PEOPLE
The Swiss leaks uncovered accounts belonging to an impressive line-up of high-profile figures, from the heads of royal families to top bods in business, film, and sport. Having an account in a Swiss bank isn’t illegal and doesn’t prove tax avoidance; however, given the shady dealings which have emerged at HSBC, it’s hard to believe that everyone’s hands are clean.
THE LITTLE PEOPLE WILL PAY
A 2014 report by the Equality Trust revealed that the poorest 10 percent of British households pay eight percent more of their income in all taxes than the richest; 43 percent compared to 35 percent. And that’s before tax avoidance schemes have been taken into account. What the rich fail to put in, the rest of the country must cover in taxes like income tax and VAT.
WE’RE SCARED OF THE BANKS
According to lawyers, if UK bankers misbehaved in Switzerland, they can’t be prosecuted here unless they advised clients on UK soil, which, according to Panorama, they may have done. But how aggressively will they be pursued? Richard Brooks—former tax inspector, Private Eye writer, and author of The Great Tax Robbery—believes the answer is: not very.
THE UK TAX CODE IS BULLSHIT
The UK has the longest tax code in the world. It’s more than 17,000 jargon-packed pages long, loophole after glorious loophole. There is probably no one on the planet who understands our tax code in its entirety.