Brian Monteith: Who put Diddy Men in charge?
HAPPINESS, happiness – the greatest gift that I possess, sang Ken Dodd. This week, the British Government inadvertently provided us with some light relief by unveiling the results of its first Happiness Index. What a lot of nonsense and a complete and utter waste of the £2 million it cost.
This is not a replacement for measurable economic facts but is survey-based objectivity worthy of the NSE – the Nottyash School of Economics – called Diddynomics.
The index is yet another Blairite PR wheeze from Prime Minister David Cameron based upon the false idea that politicians can make us happier by their good deeds – well let me suggest it’s by getting out of our lives that they will have the most success.
Take this week’s example of junior Treasury minister, David Gauke, who lectured us about how it was immoral to make cash-in-hand payments because it was a way of avoiding paying tax. Frankly, the man is a buffoon of the first order.
On first hearing I’m sure many readers might think he had a point, that paying people in cash so we might get a cheaper price or discount on a roof repair or the mono- blocking of the yard is the thin end of the wedge of people evading tax – but this is to confuse and conflate two issues.
Firstly, tax avoidance is not a against the law, nor is it immoral. Taxation is legalised theft; it is extracted from us by the coercive force of the state.
That we submit to this coercion is only because we recognise that there are some activities for the greater public good – such as our national defence and the maintenance of law and order – that are best funded by pooled resources. Even then, we primarily enforce state taxes to minimise the number of freeloaders that might receive benefits without making contributions.
The people that bring this system into disrepute are the politicians that expand the state’s role in our lives – creating more and more schemes that are deemed to be in the public good and thus requiring more and more taxes.
Our duty is to ourselves and our families and then our wider communities and country – but our country should not be confused with the state, for they are two different things altogether.
On the other hand, tax evasion is against the law and is morally repugnant. That is when you are legitimately due to pay tax by law and seek to find ways to evade paying.
We therefore should pay the taxes we are due, for that is upholding the law, but there is no moral obligation for us to pay anything in addition and if there are ways of paying taxes that mean you are entitled to retain more of your earnings and dispose of them as you see fit then you are morally entitled to do so. Indeed, to give the state more money than it is entitled only encourages the politicians’ greed.
The second issue is that it is not illegal to pay anyone in cash. Indeed, it remains against the law to pay anyone in anything else if the person requests it.
This law used to be called the Truck Acts and date as far back as 1496. Designed to stop employers paying workers through the control of goods in kind, the 1831 version of the Act said: “The entire amount of the wages earned by or payable . . . in respect of any labour by him done . . . shall be actually paid to such artificer in the current coin of this realm, and not otherwise.”
Subsequently amended and replaced by the Employment Act 1996, David Gauke as a Treasury minister should have known this.
The responsibility for the legality (and the moral obligation) rests not with the person paying (the target of Gauke’s odious outburst) but with the recipient – who is obliged to declare the sum of money received to the tax man.
Anyone who pays for a job cash-in-hand is not evading tax – for there is unlikely to be any tax liability to that person. One may be avoiding tax such as VAT, but even that cannot be said to be certain, for how is anyone to know whether or not someone should or should not be VAT registered? It is not anyone’s legal requirement to be satisfied of such knowledge before commissioning work because it is not our business to know other people’s financial concerns.
A junior Treasury minister should know such things – and especially a Conservative one at that.
It came as no surprise then to find that, when confronted on BBC’s Newsnight, Gauke would not categorically deny he had never made a cash payment but would only say he had never asked for a cash discount!
To crown it all David Gauke previously worked in – you guessed it – a City law firm that offered entirely legitimate tax avoidance planning.
Happiness? If politicians would zip their lips and think before they utter such inanities as Gauke did I for one would be happier, but Ken Dodd will be at No 1 again long before that happens!
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Weather for Edinburgh
Saturday 25 May 2013
Temperature: 5 C to 19 C
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Wind direction: West
Temperature: 9 C to 16 C
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Wind direction: West