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Jakarta Post

The morality of tax avoidance

I love a good scandal

Nury Vittachi (The Jakarta Post)
Bangkok
Sun, October 7, 2012

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The morality of tax avoidance

I

love a good scandal. When the paparazzi are camped outside a mansion and newspaper sub-editors are jacking up their headline sizes, my heart fills with hope for humanity.

At times like these, I feel life has purpose, Santa Claus really exists, and one day mutating viruses will kill all the people I hate.

And life’s been good this year. Now I wouldn’t want anyone to think that I have some sort of irrational hatred of celebrities, simply because I want them all to die die die as horribly as possible.

No. I only enjoy watching them suffer because they learn important moral lessons from doing so. Case in point: the long-running debate on avoiding tax has recently leapt from accountancy forums to top-billing on TV talk shows.

In the US, the debate revolves around the decision of billionaire Eduardo Saverin (the guy who financed Mark Zuckerberg to set up Facebook) to renounce his US citizenship and move to Singapore. Saverin says it is nothing to do with avoiding tax, but neither critics nor defenders believe him.

In the UK, Jimmy Carr, a wealthy comedian, put his cash into a scheme that enabled him to pay less than 1 percent tax, compared to the 20 to 40 percent paid by other citizens. Carr makes jokes against business people who don’t pay tax.

“We’d all like to put some money away for a rainy day, but you’re more prepared than Noah,” one comedian mocked Carr in front of a live TV audience. “We all now see why you work so hard — you get to keep all the money.”

Another funnyman said he was shocked to hear that Carr was only paying 1 percent tax. “One percent? Couldn’t you beat them down a bit? To point five?”

A third advised him to pretend to be sick: “You’re suffering from an illness called tax intolerance.”

His accountants was widely criticized. A celebrity sitting next to a dancer on a TV panel show said to Carr: “What a pleasure to be sitting next to the only man in Britain more flexible than your accountant.”

Another commentator asked Carr how exactly he communicated with his tax advisor. “Were you talking to your accountant through thick plastic glass? And did have a boiler suit type uniform and a very sort of brutal haircut? Because that’s where the best accountants are, in jail.”

Big accountancy firms pointed out that there was a difference between reasonable tax planning, and immoral loophole-seeking schemes — but no one was interested. Poking fun at celebrities was much more fun.

Pop singer Gary Barlow, lead vocalist for the band Take That, was also found using a dubious tax avoidance loophole. One comedian said Take That had “changed their name to Keep That”.

For his part, Jimmy Carr originally used the “but it was legal” defense, but quickly abandoned it in favor of groveling self-abasement. “I could tell you about the work I did for charity,” he said. “But I don’t think lying will make it any better.”

On the plus side, the debate did produce some creative ideas for tax accountants.

One comedian said: “I’ve got the best accountant in the world: Stephen Hawking. He put my money in another dimension.”

The writer is a columnist and journalist.

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