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Austerity & Tax Avoidance - how the left does not get it: free unicorns for all

Tom Winnifrith
Tuesday 7 November 2017

The tweet below refers to the Paradise Papers not the Panama Papers but that is not the glaring error. The error is to say that austerity is caused by tax evasion. It is wrong on so many counts.


Firstly "austerity" refers to a period, 2010-17, when Government spending has risen year on year in real terms. That is shocking given the fact that the UK has the largest Government debt in Europe and at close to 90% of GDP it is just unsustainable. And that debt is still increasing by c£1 billion a week because there has been no austerity.

Could you eliminate that deficit and have enough left over to spend even more if you stopped tax evasion, that is to say the illegal non payment of tax? Sure you could close it a bit and indeed even this feeble Government has managed to stop some tax evasion. But most tax evasion does not happen in the Isle of Man or Bermuda but right here in wet old Britain. It is called the black economy.

What is the value of total tax evasion? Over to the taxman. HMRC estimates that £2.7 billion was lost through tax avoidance and £4.4 billion through tax evasion in 2013/14. That is the most recent year for which we have such an estimate. Tax avoidance is not illegal it is just using the system to pay as little tax as possible. So total tax evasion is just £4.4 billion. And of that most occurs right here in the UK and so has nothing to do with offshore tax havens.

Putting that in context, the Government spends around £45 billion a year servicing the national debt. It spends £12.1 billion on foreign aid.

As with all left wing fantasists tax evasion is just another money tree which can be harvested again and again and again to pay for free unicorns for all.

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About Tom Winnifrith
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Tom Winnifrith is the editor of TomWinnifrith.com. When he is not harvesting olives in Greece, he is (planning to) raise goats in Wales.
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