Tax risk and rules of thumb

l was amused at the comments l received yesterday following my post on how l define the difference between tax avoidance and tax planning. Here is some of the post:

I was asked yesterday by a pretty experienced tax journalist how I defined the difference between tax planning and tax avoidance.

“That”, I said “is easy. It’s getting legal opinion.” And I put down the phone.

What did I mean? Well, I meant that the UK tax system is so straightforward and simple that nobody in their right mind would need to get legal opinion unless they were doing something malicious.

Remember, this is how I define tax avoidance. This is not simply some heuristic or intermittent indicator. This is no sloppy rule of thumb.This is how I openly say that I distinguish tax avoidance from tax planning. Not just in passing either. I say this to journalists in my professional capacity. And then I blog about the conversation on my website so that nobody is any doubt that this is what I consider the absolute definition of tax avoidance to be.

In the face of the usual neoliberal outpourings of misunderstandings, l even clarified my view in unambiguous diagramatic format.

Candidly, l cannot imagine how I could have been any more explicit. Many of the normal trolls have been saying that I have said that the definition of the difference between tax avoidance and tax planning is getting legal opinion.

l said no such thing as is readily apparent from my careful choice of words and use of nuance. If anything, what I gave was a heuristic or a useful rule of thumb.

By saying unambiguously that getting legal opinion is the definition of the difference between tax avoidance and tax planning, in a professional capacity to a journalist remember, I was simply expressing the view that tax avoidance may or may not involve getting legal advice, as may tax planning.

Of course, nobody in their right mind would suggest that obtaining legal opinions on tax matters is in anyway indicative of tax avoidance. We have a system of self-assessment where the onus is on the taxpayer to ensure their affairs are taxed correctly. Only some sort of Nazi would suggest that anybody who seeks a legal opinion in performing that task should be identified as morally reprehensible in some way and subject to persecution.

No, l simply stated the rule of thumb that, getting a legal opinion may, or may not, indicate that something is either tax avoidance or tax planning.

Or maybe just tax compliance.

What people don’t understand is that what I expressed is heuristic logic. That means I’ve seen legal opinions obtained in the course of tax avoidance.

Of course, I’ve seen legal opinions obtained not in the case of tax avoidance. But I didn’t say that. I was just talking about legal opinions in relation to the avoidance. I didn’t mention tax planning or, indeed, the difference between tax avoidance and tax planning. So anybody who is saying that l said such things about legal opinion being a distinction is just lying.

If anything, the fact that they are lying and pointing out legitimate non-avoidance uses of legal opinions on taxation just proves my original point because the multitude of examples they cite don’t count.

So, dear sophists, stop making fools of yourselves on the internet by trying to promote your half-baked drivel at every opportunity and just making up stuff on the spot and trying to get it published.

Perhaps you could just try admitting, just for once, that you were talking out of your backside? Yes? Sounds good to me.

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9 thoughts on “Tax risk and rules of thumb

  1. Quite frankly, and from a strictly hirsute perspective, those who refuse to accept, and understand, this definition, as provided, are nothing short of ‘all thumbs’, mentally speaking.

  2. Frankly Murphy I think you have the patience of Job to endure the constant snide comments from the patently thick neo-liberal trolls that linger around your site like a curry-fart in a lift. I also admire the way you are able to deal with their comments in a restrained, thoughtful and adult fashion without resorting to cheap insults, which is a sure sign that the person has lost the argument as well as his temper, so typical of far right bloggers.

    They think they’re so clever these Neo-Liberal Neo-Neanderthals. We need to club them into extinction in the same way as our ancestors did for the actual Neanderthals – it’s what a caring Civil Society demands.

  3. Murphy

    Have you considered setting up scheme which would promote tax justice under which companies could give you £1,000 or more in return for receiving a photocopy of a certificate signed by you saying that they have adhered to criteria set up by you which showed that they supported “Justice For Taxes”? It could be called the “Fair Justice for Taxes Mark”.

    I think it would be particularly useful if you didn’t really think through the criteria before setting up the scheme so allowing you to change them at any time. You should also avoid any official backing of the scheme and limit support from other bodies. Keeping quiet about the take-up of the scheme in the early days would also help, just in case people thought it was hopeless, laughable flop.

  4. Murphy

    I imagine your silence must be due to being overwhelmed by the enormous responsibilities you have taken on and that you are experiencing consequent difficulties in mounting, maintaining and defending the hard positions you like to adopt. Nothing to worry or be ashamed about for a man of your age.

    Ivan Bollocks asked me to tell you that he has several advanced massage techniques he can deploy to get your juices flowing again with abandon if you would like him to pop round.
    He could also try to clear the blockage caused by the unfortunate incident when the Mallard 000 gauge model train got stuck in that narrow back passage just after your wide tunnel, causing a severe backing up all along the line. Let me know if this could get everything in your system flowing freely again and I will pass it on to him – he has a particularly effective new lubricant he is dying to try out.

  5. Murphy

    i would like to comment, but i am so stunned by the depth of your statement that i can`t even think of anything to say.

    Love
    Pierre

  6. It is a great shame that you are too busy at the moment. Your split personality, Richard Murphy, has been posting some truly fantastic stuff. He now thinks the tax gap is 400 trillion and rising, and most of this is down to white van man. He refrains from using the term tax dodging as so many of the NGOs do, but is still prone to being wholly unable to distinguish tax avoidance from planning from evasion. We need your thoughts on all of this to restore some balance to the debate. Please let us know that you are still here – even a one-liner, which we know will contain more wisdom than anything Richard can produce (he normally drones on for about 400 pages but I’m never too sure that I get his ‘point’).

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