Monbiot on Taxation.

Our Georges gets in a little bit of a muddle about taxation. No great surprise as he has shown that there is no economic idea he cannot misunderstand.

Tax avoidance in the United Kingdom deprives the exchequer of between £25bn and £85bn a year, according to the Tax Justice Network. It's hard to get your head round these figures, until you see that the low figure more or less equates to the projected public-sector deficit for this financial year. The high figure represents 74% of the income tax the exchequer receives. It is more than we spend on the national health service. The super-rich are fleecing us.

The stall is set out quite well. All money belongs to the Government and we get to keep only what we are allowed to. Even if the Govt deliberately tells us that this or that form of investment (like, say, the various schemes to encourage regional investment, or in low cost housing, or in deprived areas or in favoured industries) will be tax privileged in order to encourage more of it, according to Georges this is morally wrong. Yup, even doing what we are encouraged to do by the micro-management of the tax rates is repugnant. Jeez Georges, get a grip will you?
I also rather liked this:

When the Daily Telegraph was owned by Lord Black, it argued that people had "a legal and moral right to work out how to pay as little tax as possible, a right which it is in the interest of all citizens to uphold"

That's actually a reworking of a rather famous Common Law judgement from a couple of centuries ago, that every man has the right to order his affairs so as to reduce their taxation (I can't remember it accurately enough to find it via google, sorry). I mean, you do agree with the idea of the Rule of Law, don't you Georges?

My own, more limited, experience suggests that nothing has changed. I sent the Inland Revenue a list of questions last week. Is it true, I asked, that (as the Liberal Democrats have claimed) "the poorest fifth of the population pay a higher percentage of their income in tax than the richest fifth"? Has the contribution from the richest fifth been rising or declining? Is it true that there has been a shift of income tax receipts from the rich to the poor and middling over the past 10 years? What proportion of total public revenue does income tax provide? Has this been rising or falling?
The Revenue's press officer rang me back. "These questions," he told me, "are blatantly political." Eventually, he promised to send me an email. When it came through, the answer to all of them was: "No such analysis is published by the Inland Revenue."

This is simply hilarious. Allow me to introduce Mr. Monbiot to Mr Google. He is your friend. A couple of moments and we reach this Inland Revenue publication, Shares of total income tax liability which shows us the portion of income tax paid by the top 1% income earners, top 5% and so on through to the bottom 50%. It also shows us that the top 1% in income earners paid 15% of the total income tax bill in 1991 and 22% today, with the majority of the rise coming the Major years, and being static for the past few. And the portion paid by the bottom 50% has declined from 15% to 11% over the same time period. This table, Income tax liabilities, by income range, 2004-05 (1) is also instructive, showing that someone on average earnings has an average tax rate of 15% and on 100,000 earnings of 33%. More such instructive information can be found on the Inland Revenue site.
I would also note that poor Georges gets hopelessy confused between wealth and income. The elderly widow in her four bedroomed house in Pinner is wealthy but has a low income. The just married barrister with a huge mortgage probably has a negative net worth but a high income, or at least certainly will as house prices "correct". The correct formulation of the question is "do those on low incomes pay a higher proportion of their incomes in tax than those in the highest income quintile?" backed up by "do those in the bottom quintile of wealth pay more tax on that wealth than those in the top quintile of wealth do on theirs?" . The answer to both would of course be a resounding no thus blowing something of a hole in the entire argument. Oh, and from the same place we get total income tax (est) for 2004-2005 at 127 billion or so, and also gives the actual numbers for previous years. Now that Georges knows where Mr Google is (his, mine and your friend) perhaps he would like to find the total Govt expenditure numbers for himself so as to do the easy division and find out what portion is in fact financed by income tax. Y'know, rather than asking one of the people we pay for to do his research, why doesn't he do it himself?
I was also highly amused to note this page:

How can I pay less income tax?

which is of course from the Guardian itself. Comments about mote, beam, eye, come to mind.
So we have a rich stew here, the commentator on matters economic making basic errors in matters economic (I guess they just didn't teach these things at the very expensive private school, Stowe, that Georges went to. As he told us a few weeks ago, too much time spent hunting and shooting no doubt.), the reporter proving incapable of doing his own basic research, the man complaining about how atrociously the Inland Revenue is run relying upon them to provide his ammunition and, to my mind the most amusing, and a wonderful proof of why we need to hack away at the Government structure, the public servant so mired in bureaucracy that he doesn't know the statistics that his own department prepares and publishes. A wonderful encapsulation of Britain today.
Georges does, as with the random typewriter and Hamlet thing, manage to make one good point:

I have a cruel and unusual proposal: everyone's tax returns should be published. If the teachers and dustmen of this country could see that certain multi-millionaires are paying less tax than they are, they'd be so angry that the government would surely be obliged to act.

I agree. As it's your idea we'll start with you shall we? It might almost be as amusing as finding out that Will Hutton and partner are inner city landlords.