It was a long established doctrine of the U.K. tax system that a man is free ...

To manage his affairs in such a way as to not unnecessarily pay tax. I'm not talking illegal tax evasion, but rather if there are two different ways of doing something, you're not obligated to pick the one that gives rise to the highest tax burden.

In the last 5 years or so, with it becoming public the lengths some high profile people and businesses have give to in a bid to minimise their tax liability, that principle has come into question. The basis for this is not the law, but rather some kind of moral obligation to pay tax. That approach is at odds with how our tax system worked for 100 years or more.

Hodge was obsessed with not what the law prescribes, but with what people "should" do. Cameron and co have also banged on about doing the right thing and morality etc. Problem is, if it isn't tax law that determines what the right or wrong thing to do is, what or who is it that decides?

This government have done more than any of their predecessors in the last 20 years (or more) to clamp down on avoidance. The rod they made for Cameron's back was to put it out there that it's a moral issue and not a matter of law.

Clearly some avoidance involves artificial structuring and transactions, and there's no doubt which side of the line that falls. But things like this? If the law was intending to stop this it would be redrafted such that gifts always counted in the inheritance tax computation (rather than only if death occurs within 7 years of the gift), problem is, that's irrelevant because that's not the question that Cameron is required to answer.

Posted By: SimonOTBC, Apr 11, 20:15:04