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The Lower You Are, The Harder You Fall

The Lower You Are, The Harder You Fall.

 If there is anything that gets people’s backs up and causes deep anger and resentment, it is the actions and attitude of wealthy institutions and individuals and their avoidance of paying their dues to society. This was fuelled this month by the corporate filings of Reuters, JP Morgan, Bank of America Merrill Lynch, Deutsche Bank AG, Nomura Holding and Morgan Stanley that showed their main UK arms paid no corporation tax followed at New Year by disclosure that the Financial Conduct Authority had decided against releasing their report on how the countries top lenders are run – all of which just adds to the disquiet and anger felt by the public towards the banking sector.

They are in good company. Disclosures over recent years have highlighted that Google, Starbucks, Amazon and most recently Netflix, likewise, avoiding paying corporation tax despite generating an estimated £200m in revenue from its 4.5 million British subscribers.

Of course, in none of these instances is it suggested that they broke the law – rather they just worked out ways to circumvent it, through a variety of legal mechanisms or by basing their business in one of the many tax havens, all legal (although many would argue, hardly ethical either). Rather than addressing such wide-scale abuse by the big corporations, however, the response of the Chancellor in his last budget has been to set his sights on small firms and self-employed workers who will be required to submit quarterly tax returns by 2020, estimated to cost micro businesses an extra £600 a year in accounting fees, hitting £1,600, while companies that employ staff will see their costs rise by £500 to £3,400.

But while such disclosures cause considerable anger, what causes even greater resentment is the wholesale way in which politicians continue to abuse their public office, as was exposed so graphically in the expenses scandal, but appears to have continued, undiminished. So when we read the speaker of the House of Lords, Lady D’Souza hired a chauffeur-driven Mercedes E Class to travel to the Royal Opera House just one mile from the Houses of Parliament (and detained the driver for the return journey) at a cost of £230.40 or that she and the speaker of the House of Commons, John Bercow, travelled separately from Westminster to Canterbury for the enthronement of Archbishop Justin Welby, (costing, respectively, £627 and £525), we are right to ask whether they quite understand whose money they are spending. Perhaps they never bother to consider that people on the minimum wage earning £6.70 per hour (or £268 for a 40 hour week), would need one month’s tax to pay for even one of those journeys. Such lavishness begs the question as to whether they just don’t get it or just don’t care? And when we read that Government expenses are now higher than at the height of the expenses scandal five years earlier or that the majority of the House of Lords claim their £300 a day expenses which they are entitled to if they attend even part of a sitting, even if they live in London (in 2015, 117 members never spoke at all in the House of Lords including at least 49 who signed the register and collected, on average, £4000 tax free per month), we have to wonder at the morality of those who look over us and whether they understand anything at all, outside of their little bubble.

 

But in some ways even worse than the provocation engendered by the examples thrown up by the press is the knowledge that the system is constantly subject to abuse and manipulation by those with the money to do so. While lower income earners pay their taxes through PAYE, too many of those with the money and the means to do so employ accountants and financial advisers, trust fund managers and fixers to help them keep what they have and grow it, using a variety of tax avoidance schemes and various trust and equity funds. Similarly, society looks askance as petty crime results in a criminal record or jail sentence, while large-scale financial misdemeanors on a scale that destroy families and lives appear to escape any censure (after all, where are the bankers in our prisons?) The problem in such naked self-interest is that it is not tenable in the long-term. And meanwhile we wonder why there is such anger in the shires as half the cabinet luxuriate at Rupert Murdoch’s Christmas party, oblivious to it all . . . .

It is an iniquitous state of affairs, and one exploited by too many who should know better, hell-bent as they are on perpetuating their financial advantage while exhibiting little sense of shame or social conscience. It is a parlous state as history tells us. Sadly, their self-interest, evident in the way that they spend their lives looking after themselves when they are being paid to look after others, fills many in society with a sense of foreboding.

 

 

 

 

 

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