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IN PRAISE OF TAX AVOIDANCE. Thoughts on the Panama Papers.

April 6, 2016

     “It’s terrible and shocking. To evade his taxes he set

      up a tax avoidance shelter to protect his wealth and took up

      residence on a Caribbean island.”

      “Smart fellow.”

      “You don’t mean that.”

      “Sure. He worked hard, made his pile and now wants to protect

       It. I’d do the same in a heartbeat. Good luck to him.”

The reader should note the simultaneous use of “evasion” and “avoidance” in the same sentence. The world’s governments, ably assisted by a compliant media have blurred the line between these two different concepts.

That unshaven twit, the one in the train spotter’s duffel coat, the British Opposition Leader, Jeremy Corbyn, did the same the other day: “As the leaked documents show, tax havens have become honey pots of international corruption, tax avoidance and evasion.”

And on that front, UK Prime Minister David Cameron’s late father has been “exposed” as having created an offshore tax shelter to protect his funds. Eminently sensible in my view. It no doubt enabled him to send David to Eton. But not so long ago, for political reasons, David Cameron incited the mob by denouncing tax avoidance as “legal but immoral.” Now he’s on the defensive claiming his and his father’s business affairs are a “private matter.” It’s nice to see him squirm.

And here’s that other hypocrite, Barak Obama on the subject:

     “A lot of these loopholes come at the expense of these middle-class families because that lost revenue has to be made up somewhere. Alternatively, it means that we’re not investing as much as we should in schools, in making college more affordable, putting people back to work, rebuilding our roads, our bridges, our infrastructure, creating more opportunities for our children.”

   Yeah, right! Have ever heard such shite as that? You’d need a heart of stone not to laugh. Who writes this crap for him? He should have said:

“Tax avoidance is wrong and should be criminalized. It denies our IRS from aggressively looting money wherever they can find it. How else can we fight endless and stupid wars against small defenseless countries, build cruise missiles and other weapons and kick ass big time.”

In my view, there is only one fair and just tax and that is VAT, or value added tax. All other forms are unfair, discriminatory and open to abuse. Offshore tax havens practice this. The only tax in the Bahamas for example is VAT. And that’s how it should be.

   The US built a monster in the IRS. All are afraid of it. Even the President is scared of them. It would take a man a lifetime to read its tax code. It keeps Americans poor. Many leave because of it. No other country has as much punishing direct and indirect taxation. But despite this they are the world’s biggest debtor; debt they can’t service much less pay it off. Their country is in reality bankrupt.

And Britain and the EU are no better. People are taxed to death by governments who shamelessly waste it all. And the politicians who impose these tax laws go right ahead and fiddle their government expenses.

    Tax Evasion: It is usually illegal and even criminal. And it should be whether pursued by individuals or business corporations. Tax evasion is the deliberate misrepresentation of the state of affairs, personal or corporate by any means  available. It is commonly used in the “alternative’ or black economy and by organized crime.

    Tax Avoidance: It is legal, and sensible. It is the legal usage of a tax regime to reduce the amount of tax that is payable by means that are within the law. IT HAS ALWAYS BEEN CONSIDERED AN INDIVIDUALS DUTY TO DO THIS IN ORDER TO PROTECT HIS PERSONAL AND BUSINESS EARNINGS FROM RAPACIOUS GOVERNMENTS.

“While tax avoidance may be considered legal, it is almost never considered moral in the court of public opinion. Many corporations and businesses which take part in the practice experience a backlash, either from their active customers or online.” (Wikipedia)

And what is the “court of public opinion?” At one time it was called the “common herd.” Easily riled and manipulated, they’re jealous of talented, successful people, who’ve worked hard, made it, and who now want to protect their wealth from government tax grabbers.

While it is true that many dictators and criminals hide stolen money in offshore jurisdictions, the majority are perfectly normal honest people. Many of the world’s top athletes go offshore and reside in tax friendly countries. Use a search engine and check them out. Tennis star, Novak Djokovic, for example, is resident in Monaco. It’s called tax avoidance and it makes sense.

If your Aunt Sally left you her fortune or you won a large amount on a lottery would you deposit in the local bank and let the government get into it? Not if you’re smart. Your first move should be to protect the money – from the government, by shifting it offshore.

Arthur Hailey, the British novelist, struggled for years writing and getting nowhere. Then he hit the jackpot, his books sold in the millions, films were made, and Hailey became rich.  He was living in California at the time and happy with his good fortune until his financial advisor told him that American tax laws were “punitive.” Unless Hailey wanted to donate most of his money to the IRS, he would need to move to a more sensible jurisdiction. He didn’t want to leave, but they gave him no choice. He moved to the Bahamas. That’s tax avoidance. Let’s have more of it.

As a struggling writer working away on two novels I have to say that if I got the opportunity to grab the brass ring I’d do so; vigorously. If I got lucky and my books sold and movies got made, would I move my funds into a tax shelter? Would I shift my butt into a delightful offshore island paradise with sensible tax laws and no standing army? Would I avoid taxes?

You betcha. In a heartbeat.

 

 

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