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Comedians, pop stars….and the hard working taxpayer

Jun

23

June 23 , 2012 | Posted by Fern Price |

Comedians, pop stars….and the hard working taxpayer

Tax… Pay day comes once a week or once a month and you’ve earned hundreds, thousands or even hundreds of thousands of pounds – only to find a massive chunk of cash has been taken away to pay for anything from a school, even if you don’t have any kids; the NHS, even if you’re never ill; or roads, even if you don’t drive or ever use public transport. Everybody has their own separate idea of what their hard-earned cash should be spent on by the Government. Perhaps this is why tax is resented by so many?

Imagine how much more it is hated, then, when it is discovered that those millionaire pop stars and celebrities (who, admittedly, we all help to make millionaires…) resent paying it so much that they commit themselves to a life of tax avoidance.

Taxes, in their current form, have been a fact of life in the United Kingdom for centuries and people have been trying to avoid them ever since – particularly the wealthy. The antics of Jimmy Carr and the K2 tax scheme come as no surprise at all, therefore. Just think Phil Collins, Mick Jagger, Sir Philip Green, easyjet Stelios or tax exile Robert Gaines-Cooper, who continues to fight HMRC over a £30m tax bill which they say he owes for the period 1992-2004.

Tax avoidance schemes are so commonplace that most of them pass us by almost completely unnoticed. It’s a key part of the business world, for sure; this is why companies pay thousands of pounds for the services of specialist tax-avoidance financial advisers. But when tax avoidance involving an individual such as Jimmy Carr is thrust into the limelight, the impact and anger evoked is multiplied at least ten-fold. And in the current economic climate, you might even double or quadruple that level of anger.

But is our anger aimed in the right direction? Tax avoidance schemes are completely legal (unlike, say, class A drugs or driving without insurance) and the rich and famous are human beings after all. If you had cash to splash to get someone to support you in a tax avoidance adventure would you do it? There are lots of morally wrong things in society, not just tax avoidance. Why should millions of people work from 9-5 every day to support their families while others receive the same or even a higher income in benefits from sitting at home all day watching Jeremy Kyle, Bargain Hunt and Loose Women? You needn’t look further than the Daily Mail for these kinds of things, of course.

The crux of the issue probably lies more with the lawmakers then, or those who are in a position to influence laws and legislation. PM David Cameron was quick to single out and condemn Jimmy Carr over the K2 Tax Avoidance Scheme (although less so with Take That’s Gary Barlow). He is also quick to support hard working families and to commit to disincentivising a life spent living solely off the welfare state. Yet realistically, unless tax avoidance slips into tax evasion, or claiming benefits slips into benefit fraud – both of which are illegal – responsibility for ‘morally repugnant’ acts in society might arguably be as big a deal for politicians as those who are scorned upon for taking advantage of legal loopholes. It is only an overhaul of legislation and legal systems that will ever bring about a move towards moral parity.

Is society right to be disgusted with the fact that Jimmy Carr can save more in tax avoidance in one year than some of us earn in a lifetime? Absolutely yes.

Can we do anything about it in the short-term? Absolutely not. Things which have been going on for hundreds of years don’t change overnight.

Then again, we could stop buying DVDs, paying to watch comedians, musicians and sports-stars perform or watching them on TV, sending their viewing figures plummeting. And then tax avoidance might not be so such a big deal for them – or us – after all.