The London Paper – 3 Mar 2008
“To fast cars, cheap whores and no taxes” – so goes the traditional City toast. I, being a man of materialistic abstemiousness and almost unparalleled ethical standing, do not feel qualified to comment on the first two issues though I must admit that in less enlightened times gone by I have minimized my tax bill – principally through film-based investment schemes. However, I have now realised my moral duty to pay taxes to fund hospitals and schools and happily pay the full 40% on all my earnings … though it is clear that many of my fellow Cityboys feel no such compunction.
Last week the FT reported that the UK Government had finally stumped up the cash to pay a whistleblower from Lichtenstein. This chap provided a list of characters working in the UK who have used the secretive tax haven to avoid paying the Inland Revenue a portion of their hard-earned cash (though I use the word ‘earned’ in the loosest possible way). The FT estimates around £100m of taxes could be recoupable with the help of this list. Some of my fellow Cityboys are quaking in their boots!
However, you can bet your bottom dollar that a hundred big ones is just the tip of the iceberg and that it is we Cityboys who, having the financial nous and the highest earnings, are the most efficient tax dodgers in town. The multi-millionaires running private equity firms were recently rumbled for abusing a loophole that resulted in them paying less tax than their bog cleaners. Furthermore, half the clowns working in the Square Mile are ‘non-domiciled’, which means (unlike in most countries) they can avoid paying UK tax on their foreign earnings.
The Labour government recently proposed cracking down on ‘non-doms’ but, after a concerted lobbying effort from every self-interested group around, they watered down their fairly innocuous proposals. This latest turn-around is yet another example of how our current leaders roll over to the demands of the wealthy – something they have done ad nauseam since taking power such is their paranoia about being seen as ‘Old Labour’.
‘Taxes are for the little people’ – so said the hideous billionaire Leona Helmsley (shortly before getting nicked by the IRS). Many of my fellow Cityboys subscribe to her charming little theory. Some of my colleagues currently avoid tax by investing in Italian renewable schemes whilst others simply have masterful accountants who know which off-shore tax havens can best be exploited (I think the Cayman Islands are in this season).
The problem is that our tax avoidance doesn’t just mean that Government expenditure on social services is subsequently reduced. It also ensures that the resentment felt by many Londoners towards Cityboys and their insatiable greed and envy-inducing conspicuous consumption is intensified – helping to make our increasingly divided society ever more angry and violent. You’d think that with our fellow Londoners hating us so vehemently already that we wouldn’t choose to rub yet more salt in their wounds!