UK government green-lights tax avoidance schemes. A spokesperson said: “It’s much easier to get tax out of the poor.”
Tax avoidance schemes such as the infamous K2 scheme – which was perfectly legal at the time – got a lot of people into trouble.
The scheme used perfectly legal (at the time) methods to avoid tax (which isn’t illegal), but the media ran a witch hunt to name and shame celebrities and other rich people who used these perfectly legal (at the time) schemes for keeping their hard-earned money.
The K2 and similar schemes were shut down by the government and HMRC (Her Majesty’s Revenue and Customs).
However, as alternative schemes proliferate and attract the interest of business owners, celebrities and other rich people, the Financial Ombudsman set up an enquiry into these schemes with a view to stopping such blatant use of perfectly legal methods (at the time) of avoiding tax (which isn’t illegal) which the media didn’t like. After three years, the Ombudsman has published its recommendations.
It found that over 80% of big business owners, CEOs, bankers, traders, Peers and Lords of the realm as well as MPs, were using these schemes (which were perfectly legal at the time).
Coincidentally, it found that many participants were donors to the Tory party.
Rather than ask HMRC to look at ways to claw back perfectly legal (at the time) tax so avoided, the Ombudsman suggested that it will be far easier to remove the stigma associated with these perfectly legal (at the time) schemes.
The schemes, though perfectly legal (at the time), had been “frowned on” by the media and people who didn’t have as much money as rich people, much as most people “frown on” the perfectly legal methods used to award CEOs bonuses and golden handshakes even if the company performs badly, and the way most people “frown on” the perfectly legal way in which MPs vote themselves large pay rises while millions wallow in poverty.
That sort of “frowning on”.
So the government is to spend £2.6m on a campaign telling everyone that tax avoidance schemes are fine, and perfectly legal – even though they always were perfectly legal (at least, at the time) – and not to “frown upon” rich people and Tory donors who make use of these perfectly legal (at the time) schemes which, after all are open to everyone, rich and poor alike. Although mainly rich.
A government spokesperson said: “We’ll just reclaim lost tax from the poor, the disabled, the mentally ill, by cutting services and selling off bits of the NHS. It’s far easier than chasing our mates half-way around the world. They might never invite us onto their yachts again.”