Raise your hand if, offered a legal way to do so, you would opt to pay less tax. Pretty much most people reading this, right?
After all, who wouldn’t want to pay less of their earnings to a government which (as far as we’re concerned) whittles it away on such things as a duck home for the moat around the house (Google ‘MPs’ expenses’)?
But comedian Jimmy Carr has been lampooned for doing exactly this, hung out to dry for getting involved in a completely legal tax-avoidance scheme that protects £3.3m of his salary a year.
Displaying spectacular hypocrisy, prime minister David Cameron (whose father ran a hugely profitable network of off-shore tax havens) said Carr’s actions were “morally wrong”.
And there we all were, believing Carr was a bastion of morality; a purveyor of truth, guiding us to live our lives accordingly – not just a quick-witted stand-up giving us a giggle now and then.
(And, by the way Mr Cameron, is it morally right to have as a close friend the head of a media empire that wants to conduct business with your government?)
There are some 1100 other users on the K2 scheme, which works by finding ways around the tax loopholes Revenues & Customs closes.
“It’s a game of cat-and-mouse,” one accountant said. So why pounce on Carr? The comedian faced a backlash and has now apologised, telling his 2.3 million Twitter followers: “I met with a financial advisor and he said to me, ‘Do you want to pay less tax? It’s totally legal’. I said, ‘Yes’. I now realise I’ve made a terrible error of judgement.”
The best outcome we can hope for, now Carr has been made an example of, is that the government gives the same treatment to everyone in such schemes, including the British firms using Swiss companies to legally avoid paying billions of pounds in UK tax – making Carr’s avoidance look like spare change.
If it doesn’t, it seems the joke really is on us.
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