Taxes, Taxes, Taxes

Bother! As Rutgers Bregman said at Davos, it’s all about taxes, taxes, taxes. (In case you have not seen it yet, here is the link to the now famous Davos panel session on inequality)

We will all have to pay more tax. The richer we are, the more tax we will have to pay. Sorry guys!

The reason is all around us: the money currently available for public services has fallen below the economic cost of providing them to the standard we require. Two stories in Saturday’s (17th February 2019) Financial Times illustrate this.

On page 2 we learn that staff providing probation services in Dorset, Devon and Cornwall “…….told inspectors they sometimes refrained from giving an offender a red risk rating – the highest level – because such offenders needed to be seen every week and so used up more resources”.

On page 3 it is reported that the that the Cabinet Office has “postponed indefinitely” the recruitment of new project management apprentices because the training provider “…..could no longer cover the teaching costs”.

Do we really want the highest risk offenders to go unsupervised or to be governed by untrained civil servants? If not, we must foot the bill.

The good news, for those UK income tax payers who hate paying tax, is that there is a tried, tested and legal way of putting income beyond HMRC’s grasp. This is to give it to charity. Under our current income tax regime, the tax man will then pay the lower rate tax due on your donation to the charity and set the higher rate tax against your other tax due. Brilliant!

The surprising thing is that (again according to this Saturday’s FT, p3) the median level of charitable giving amongst the UK’s ultra-wealthy (people worth more than £10m) is a measly £240 a year. It may be that the ultra-wealthy, unlike the rest of us, see the Government as the wise and universal provider of all social needs and rectifier of all social wrongs. Or it may be that if you have so much money you do not mind paying tax, any more than paying for the over-priced restaurants, hotels, baubles  and gewgaws that you can also read about in Saturday’s FT

Whether you are ultra-wealthy, just wealthy, or plain ultra non-wealthy, living in a civilised, orderly and prosperous society is a privilege that comes with costs which have to be paid – in exactly the same way as all those restaurants, hotels, baubles  and gewgaws.

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