If you could legally avoid tax, would you do it too?
Caveat: no use raging about the rich exploiting tax loopholes – we need clear rules
Is tax only for the little people? It is one rule for the rich and another for the rest of us. If only wealthy people and businesses paid their fair share, we would have more money to fund services. Tax avoidance is morally wrong. People should not avoid tax.
That’s a flavour of the typical gamut of responses to this week’s Paradise Papers leak, which revealed that companies and rich people still don’t like paying tax if they can get away with not doing so. Did they ever? More importantly, will they ever think differently?
The typical responses above, which are all completely understandable on a human level, also reveal two much more interesting things: our own naivety to think that morality or volunteerism will ever trump hard rules when it comes to handing over cash to the tax authorities; and the total cowardice of our politicians, who prefer to indulge in rage bait along with the crowd instead of getting off their amply cushioned rears and doing the hard work of creating solutions.
First, our own naivety. Tax evasion is illegal, that is cut and dried. Any evasion revealed by the Paradise Papers is demonstrably wrong and that is the end of that debate.
But the vast bulk of the activity revealed appears to be legal tax avoidance. Are we not off our heads, or at best wilfully naive, to think that anyone will ever pay more tax than they legally must?
To hold this out as the way forward is to reduce the payment of tax to a sort of charitable activity, something that rich people and businesses should volunteer to do to a certain level, even though the law says they don’t have to. There is something fundamentally unsustainable about that as a proposition; a fallacy that serves only to make us feel more moral as we rage, knowing full well that, in their shoes, we might well consider doing the same.
The level of embarrassing and glorious detail contained within the Paradise Papers leak, and the effect these revelations have had on the rich and global businesses, has been the best bit of this whole affair. From Bono to the actors in Mrs Brown’s Boys, from Apple to the clients of AIB and, of course, our beloved plutocrats, I have enjoyed watching all of them squirm. It’s the smarty-pants sadist in me.
But would I behave much differently if it were me? I’m not sure that I would.
We can all easily say that we wouldn’t behave the same way, that we’d be more moral. But there is a certain cowardice in that notion, too, because most of us will never be that rich, with the tax advisers that we hired yapping in our ears about what we do and do not have to pay. And so we will never have to test our own self-aggrandising theories that we would behave in a morally superior fashion to Bono and all the rest if it was our hard cash that was about to handed over voluntarily.
The tax avoiders are simply exploiting loopholes, which, when you think about it, only arise as a result of somebody else’s incompetence. If the rule-makers were competent, there would be fewer loopholes. I’m not sure I’d be moral enough to pay for some civil servant or politician’s incompetence with a few million euro of my own cash, if it came down to it. Perhaps you would.
Morality should have no place in the operation of the tax system. It is too nebulous, too easily avoided, too debatable a concept to be used as the basis for the collection of money to fund vital public services. Firm, clear, inviolable and competently assembled rules are a better basis. They’re just not as sexy a concept as morality.
I agree that rich people and companies should not be able to pay minuscule tax bills that are out of whack with the proportions of tax paid by the rest of us, simply by bunging stuff offshore. But it is ridiculous to suggest that we can square that circle by pleading with the rich to be more moral. Only the lawmakers can solve this problem, which is where the cowardice of our politicians comes in.
Howling about the unfairness of it all along with everybody else gives the carefully created impression that politicians are determined to deal with the matter. It is certainly a lot easier than getting out the constitutional lawbook and devising watertight rules. Repeatedly telling us that the new rules are on the way is not good enough. Deliver.
The Paradise Papers, and the Panama Papers and Luxleaks before them, have done the essential job of focusing the light on where these loopholes exist. For that is what we need to solve the quandary of how to make the wealthy pay tax at the level that society desires: more light, and less raging, self-serving heat.
The loopholes are no longer unknown unknowns. Politicians and civil servants know exactly what they are. But to make an honest attempt at fixing them, they must first confront their own incompetence, which caused the mess in the first place.
If they are not prepared to do even that, that should be of more concern to us than the morality of a rock star, or a comedy soap actor, or those whose morals we already know are completely shot through.
Grabbing the expat market by the Curly Wurlys
Often, a lot of emphasis is placed on the implementation of a new business idea – the design of its consumer-facing technology, perhaps, or its pricing and distribution.
But sometimes, the purest beauty of a new business is to be found in the original idea itself. And have you ever seen of a more joyful, hilarious and utterly brilliant business idea than The Paddy Box, which wraps up typical Irish goods such as Tayto and Curly Wurly bars and sends them to emigrants abroad?
Thirty-year-old Dublin businessman Mark Loftus has set up a very straightforward venture. The Paddy Box is not revolutionary, it is simply a cross between a hamper business and an online retailer. You buy the stuff as cheap as you can wholesale or direct from manufacturers, take orders, pack it in a box, and ship it.
Loftus has presumably worked very hard to get it to this point, and this is not to denigrate his team’s effort. But the brilliance of The Paddy Box is in the original idea. Its marketing plan writes itself.
Paddy Box is nostalgic, it fits a zeitgeist (in this instance, Irish experience of emigration), it immediately gives customers a sense of buy-in and ownership of the concept, and it is funny.
Its products include the Not Before Your Dinner box, which contains all the indigenous confectionery we are used to; the Back in the Day box, which contains old favourites like Chewits and Curly Wurlys; and the Go On Go On box, which contains Irish cheeses and buscuits etc. The sort of stuff your Ma laid on when the neighbours came for tay.
It is great to see emigrants returning to Ireland recently as the economy improves. I just hope enough of them stay away to give The Paddy Box a decent market, and a proper shot at long-term success.
Delaney hoping Ireland can seal the deal against Denmark
On Tuesday evening, the Ireland football team will find out its fate as its bid for World Cup qualification comes to a close with the second leg of the play-off against Denmark at the Aviva stadium.
FAI chief executive John Delaney will have an early start that day, however. About 12 hours before the match, he is pencilled in as the keynote speaker at a Grant Thornton event at the Shelbourne Hotel. The theme of the event? “Deal or No Deal?”
That, surely, will be a question Delaney will pose to Martin O’Neill and Roy Keane at the conclusion of the match.