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Issue #1675      March 4, 2015

Tax evasion and class society

There could hardly be a more poignant vignette of Britain today than the hidden truths revealed by the HSBC Swiss bank. Five years after this colossal tax evasion and avoidance scam was known to the British authorities, there has been one prosecution.

At the same time, in just one of those five years (2013), no less than 1,046,398 sanctions – deprivation of all income for weeks or months on end – were imposed on unemployed people claiming jobseeker’s allowance, often for trivial or even incorrect reasons.

Also in that year nearly 200,000 people were prosecuted because they didn’t have a TV licence. The culture of rewards and punishments in Britain today is based unambiguously on the ideology of class power dominated as never before by a small clique with overwhelming control of wealth and power.

It was coincidental, but deeply meaningful, that at the same time that news of the HSBC Swiss scandal broke, the Tories held their Black and White Ball to raise funds for the party.

More than 500 extraordinarily rich Tory donors took part in a pricey bash at the Grosvenor House hotel in central London, forking out £15,000 a head for dinner, though that’s a tiny addendum to the vast sums that these plutocrats have already, and will continue to, cascade into Tory party coffers before May 7.

The wealth of last year’s guests added up to £22 billion. It was probably more this year, though the Tories imposed a news lockdown to prevent the rest of us finding out.

For the rich scroungers the rewards are phenomenal and the risks negligible.

Even if they’re caught, which must be one chance in hundreds of thousands, there’s no naming or shaming, let alone the indignity of prosecutions.

Even if the worst comes to the worst, HMRC (Revenue and Customs) only demands the tax owed plus interest, plus a 10 percent rap across the knuckles, not a penalty of five times the tax owed or – perish the thought – confiscation.

If the ultra-rich use top lawyers and accountants to resist, as unquestionably they do, the matter is often resolved by a negotiated “agreement,” and no further action is taken.

Even the Financial Times recently argued that “no-one who commits a crime should be able to bargain for a pardon.” It’s a thoroughly bad culture. Suppose a burglar caught red-handed with the swag bargained to give back some or all of it and was then allowed to walk away free. It would create a furore.

Prosecutions are essential to puncture this complacency for the super-rich.

That would cast a chill over other would-be offenders which would be more effective than all the money raised at present.

Add in two other ingredients – an incentive for whistleblowers by allowing them to keep, say, 30 percent of the money their revelations raise, plus an office of tax responsibility to keep a public and transparent check on government revenues matching the Office for Budget Responsibility checking on government expenditure – and the ideology of class power would take a decisive hit.

Morning Star

Next article – NATO finds Arab backdoor to arm Kiev

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