Joyce Mcmil­lan: Tax avoiders have made fools of us all

Off­shore riches could end aus­ter­ity – a fact hid­den by com­plicit fools in the me­dia, writes Joyce Mcmil­lan

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He de­nied ever hav­ing said it, ex­cept about prop­erty spec­u­la­tors. Yet there are mil­lions of us still around who can re­mem­ber the mo­ment, more than 40 years ago, when the then Chan­cel­lor of the Ex­che­quer, De­nis Healey, was re­ported as say­ing that he would “tax the rich un­til the pips squeak”; and, also per­haps, the strange lack of en­thu­si­asm with which the phrase was greeted, even among some on the left.

For back then, at the be­gin­ning of the long po­lit­i­cal cy­cle that is now end­ing, we were con­fi­dently told by the ris­ing gen­er­a­tion of econ­o­mists that tax­ing the rich was point­less and even coun­ter­pro­duc­tive. There weren’t enough of them, the sums raised would be in­signif­i­cant, and in any case they would just take their wealth else­where; in­deed, you can still hear ex­actly the same ar­gu­ments be­ing rolled out to­day, against any sug­ges­tion of slightly higher taxes for the welloff.

If this week’s re­lease of the so-called Par­adise Pa­pers demon­strates any­thing, though, it is just how far those ar­gu­ments no longer ap­ply. To­day, it seems there are plenty of rich peo­ple; about ten mil­lion across the world have some money off­shore. And the sums them­selves are sim­ply stag­ger­ing; the to­tal was con­ser­va­tively es­ti­mated in 2012 at some­thing around $21 tril­lion, or al­most £16 tril­lion. One tril­lion pounds is a mil­lion mil­lion; and with the an­nual to­tal spend of the UK gov­ern­ment run­ning at around £800 bil­lion, that means that those off­shore funds are so vast that they could sus­tain the whole of the Bri­tish pub­lic sec­tor at its present level for more than 15 years, even if we in Bri­tain paid no tax at all. The an­nual £20bn that has been cut from UK pub­lic ex­pen­di­ture since we be­gan our post-crash “aus­ter­ity” drive in 2010 also un­can­nily matches the £18.5bn con­ser­va­tively es­ti­mated to be lost to the Bri­tish Ex­che­quer ev­ery year through tax eva­sion and avoid­ance, even at present mod­est tax rates.

And all of this, it seems to me, should add a cer­tain per­spec­tive to our view, when we come to dis­cuss do­mes­tic pol­icy on mat­ters of tax­a­tion and aus­ter­ity – or for that mat­ter, the rel­a­tively tiny sums stashed away by cast mem­bers of Mrs Brown’s Boys. There is no point, of course, in be­rat­ing those in­volved in this mas­sive 30-year-episode of tax avoid­ance as if they had been in­volved in crim­i­nal ac­tiv­ity. It is clear that, from the City to Buck­ing­ham Palace, they move in cir­cles, and in­habit a cul­ture, in which avoid­ing tax is seen not only as nor­mal and per­mis­si­ble, but as an obli­ga­tion – a le­gal obli­ga­tion for com­pa­nies, a fam­ily obli­ga­tion for in­di­vid­u­als.

Yet the fact that it is le­gal does not make this tax avoid­ance cul­ture, and those who ben­e­fit from it, any less con­temptible, both morally and in­tel­lec­tu­ally. How they must laugh, th­ese peo­ple who have be­tween them squir­relled away tril­lions, when they see de­cent politi­cians in as­sem­blies like the Scot­tish Par­lia­ment ag­o­nis­ing over whether to squeeze mid­dle in­come earn­ers for an­other pal­try £200 mil­lion or so to main­tain vi­tal Scot­tish pub­lic ser­vices. How funny it must seem to them, when lo­cal author­i­ties have to cut es­sen­tial ser­vices to el­derly peo­ple in need of home care for the lack of the odd £50,000 here or there – a sum which, in the off­shore world, is mere loose change.

And what com­plicit fools they have made, over the past decade, of all those jour­nal­ists and broad­cast­ers who have solemnly con­ducted dis­cus­sions which be­gin with the premise “in th­ese times of aus­ter­ity, when pub­lic money is scarce…” and have gone on to set tax­pay­ers against ben­e­fit claimants, pri­vate sec­tor work­ers against pub­lic sec­tor work­ers, peo­ple suf­fer­ing from infertility against other NHS pa­tients – in other words, stag­ing di­vi­sive dog­fights for cash amongst needy or­di­nary cit­i­zens, while all of them were be­ing com­pre­hen­sively ripped off by those whose tax money, duly paid, would have made many of th­ese dis­cus­sions com­pletely un­nec­es­sary.

Well, enough. It is now as clear as it could pos­si­bly be that this cul­ture of le­git­imised tax avoid­ance is skew­ing the whole global econ­omy away from the pub­lic goods that sup­port ad­vanced economies and civilised life, and creat­ing the con­di­tions, among sov­er­eign gov­ern­ments, for a shame­ful race to the bot­tom on tax. There is there­fore no ques­tion that gov­ern­ments now need to unite to end this sit­u­a­tion, and to cre­ate cer­tain ba­sic min­i­mums for the tax­a­tion of fi­nan­cial trans­ac­tions, and of wealth wher­ever it is held.

Once th­ese mea­sures have been en­acted, it will be dif­fi­cult to be­lieve that we put up with their ab­sence for so long; and the free mar­ket ide­o­logues who tried to de­fend this ridicu­lous sit­u­a­tion will be as out of time, and out of fash­ion, as the old post­war Key­ne­sians were dur­ing the 1980s. And one clear ben­e­fi­ciary of this cul­tural shift will be Jeremy Cor­byn, that once-mar­ginal rep­re­sen­ta­tive of the small part of the Labour Party which never for­got that gov­ern­ment and cap­i­tal are of two dif­fer­ent houses, and that the one ex­ists to reg­u­late and con­trol the other, in the pub­lic in­ter­est.

For on this mat­ter and oth­ers, Cor­byn is now able to speak for the peo­ple pre­cisely be­cause he is not rich, has no money stashed off­shore, and does not make the vul­gar mis­take of be­liev­ing that cash is the only mea­sure of a suc­cess­ful life – char­ac­ter­is­tics which he broadly shares with most Bri­tish peo­ple. The To­ries, by con­trast, are up to their necks in the dys­func­tional cul­ture of boss-class fi­nan­cial sleaze ex­posed by the Par­adise Pa­pers, sur­rounded by armies of over­paid spivs, lob­by­ists and money-grab­bers who think the well-be­ing of oth­ers, or of so­ci­ety at large, is lit­er­ally none of their busi­ness.

Dick­ens had it right, though, when he had Mar­ley’s ghost roar at Scrooge that in the end, hu­mankind is our busi­ness. The money men have had their day, and an in­creas­ingly ugly and in­de­fen­si­ble one it has been; and now, as the wheels of his­tory turn again, it is time for hu­man­ity to re­assert it­self, whether through a Labour gov­ern­ment led by Cor­byn, or through any other demo­cratic means that come to hand.

0 Jeremy Cor­byn doubt­less hopes the Par­adise Pa­pers af­fair will trans­late into more votes for Labour

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