The tax avoidance industry has been spawning a tax avoidance protest industry, with the Guardian in the lead. It focusses on the non-crimes committed by firms such as Google, Amazon and Apple, who have de-localised their activities so that it is impossible to establish exactly where they are trading. The Guardian has run a whole series of features this week about the online trading company Amazon.
Amazon occupies premises in the UK and no doubt pays rent and UBR for the privilege. So the obvious conclusion would be to forget trying to collect corporation tax and raise the bulk of revenue from a tax on fixed property instead. But this obvious conclusion is not one that the Guardian journals have drawn, nor is it to be found amongst those that are shocked by the terrible revelation that these companies are exploiting the loopholes in the tax laws.
The Bangladesh factory scandal has been followed by a round of breast-beating, as if firms that sell cheap clothing, or their customers, were to blame and could do something about the situation, even if it was just to apply political pressure.
The wages of labour are in all circumstances the least that people will
accept. If there are no other opportunities for earning a livelihood,
then people will accept penurious wages. If the employer is paid
more for the produce, the extra will most certainly be retained by the
employer as profits. In due course, the higher profits will be retained
by the landlord in the form of higher rents, so the benefits do not even
go to the employer. That is the Law of Rent when all land is enclosed and its rent privately appropriated.
The situations in Bangladesh is only possible when land ownership is concentrated in the hands of a few families, who, as recipients of rent, become enormously wealthy. Until that is changed the majority of the population will live in abject
poverty. The cheap clothing retailers are not going to start campaigning for land reform, as that would quickly draw attention to the existence of much the same situation on home territory. The breast-beaters do little to help either. They rarely take a step back to assess the situation as a whole; if they did, they would, for a start, notice that poor working conditions in clothing factories is only part of a much bigger problem which exists throughout the supply chain, from what are virtually slave-labour farms in cotton-growing countries such as Uzbekistan, where child labour is used and workers are continually exposed to dangerous chemicals, to poor living conditions for those who crew the ships that bring the goods across the world.
CAROLINE LUCAS WRITES
"My Bill wasn’t discussed on Friday 26th April as it wasn’t a sitting day in the end. It was down on the Parliamentary papers for that date as a way of keeping the Bill ‘live’ for as long as possible. However, I knew that it wouldn’t have any chance of actually being debated. The Bill has now fallen as the Parliamentary Session has formally ended.
"It is confusing and this place does work in a ridiculous way! I have been trying to make the best use that I can of the limited mechanisms available to backbench MPs to help get the debate on LVT going and I think we’ve had some success in that. I’ll keep taking up the opportunities that come up to press the Treasury on this – they really shouldn’t be ignoring this issue or the likes of the IFS Mirrlees Review and the OECD."
The US Senate is apparently considering legislation to require online retailers to pay state sales taxes.
It would be misguided. Politicians and bureaucrats should accept contemporary
taxes have been made obsolete by technology. Corporation taxes have been made obsolete by globalisation, again partly
through technology. Taxes on people have been
made obsolete because they are becoming increasingly mobile. Instead of worrying about the leaks and talking about how to plug them, this is something that everyone needs to get used to.
The only viable tax in the future will be one levied on the annual
rental value of land. Land isn't going anywhere. It cannot disappear
It is nice to see professional economists revealed as charlatans, as has just happened in the Reinhart and Rogoff affair. The conclusion being drawn is that economics is not a science. We disagree. Economics is a science but, but one in a state of great confusion, as a Cambridge University professor, the late Wynne Godley, once said at the start of an article written about thirty years ago. What has gone wrong? The physical sciences commence
with a definition of their area of study and the proceed to the
definitions of fundamental terms, leading on to the development of
hypotheses, theories and models.
Because economics deals with human relationships, it also has to take
into consideration matters of morality and justice. For instance: is robbery a
legitimate economic activity? If it is not, then matters such as rights
of ownership come into the picture. Can one own air? The sea? The
surface of the earth? And if so, under what terms? Economics will then
come into conflict with interest groups if their legitimacy is called
into question. At that point, the truth may well end up getting buried. If there was a financial interest in denying the existence of gravity, be sure that it too would be written out of physics theory.