Derek Allen: Tax avoidance debate shifts towards talk of morals

One of the targets for the group's ire, Vodafone, has been in its sights all year, UK Uncut claiming that the communications group has been let off paying a 6 billion tax bill, despite denials from both the company and HMRC.

Companies as large as Vodafone and some of the group's other targets will seek to legally minimise their tax bill – tax is a cost of business like any other and shareholders expect a company to carry out its duty to keep costs under control.

But, when the government is cutting jobs and services, many people are becoming aware that taxation is an essential function of the state if it is to meet its civic obligations. Good tax advice aims to ensure that clients will pay the right tax at the right time. Good tax advice will never stray over the watershed into evasion. Avoidance, of course, is legal, even though politicians increasingly use "evasion" and "avoidance" interchangeably.

Much tax avoidance is humdrum – if you have an ISA, you are a tax avoider. However, some avoidance schemes are unacceptable and, while they may be within the rules, they are certainly against the spirit of the law. HMRC eventually catches up and closes them. There is no suggestion that any of the companies targeted by UK Uncut use any such scheme. But unless the UK tax system undergoes radical simplification, scope for the more "exotic" tax avoidance schemes will continue to exist.

What is interesting about this group is that they have shifted the terms of debate by asserting that a legal activity is immoral. The government has announced the setting up of the Office of Tax Simplification to reduce complexity and a general anti-avoidance rule which will provide a definition of acceptable tax planning. Whether it meets the idea of making the tax system more "moral" remains to be seen.

• Derek Allen is Director of Taxation at The Institute of Chartered Accountants of Scotland.