Capitalism, The Best Solution to Poverty

[PsychoSerenity]

Avoiding taxation is great. It means not paying what is not owed. I doubt you're too keen on paying more than the law says you owe, right?

There is a move afoot (or at least it has been suggested) to class tax avoidance as a criminal offence - the same as tax evasion.
To do away with 'tax avoidance' completely...

What a good idea!

What's the definition of "tax avoidance" in your locale?

Here it includes such things as lawful tax deductions, exemptions, and credits.

Evasion means illegally failing to pay taxes.

Avoidance means legally not paying taxes.

So, how much tax do you pay if you are not allowed to not pay taxes, even if you legally don't owe them? LOL.

That's an overly simplistic view of tax avoidance. Tax compliance is a better term for make use of lawful deductions where there is no risk of it being considered unlawful. Tax avoidance is making use of loopholes, making multiple transactions that serve no purpose other than to avoid tax, doing things that could be argued are technically legal but are not the spirit of how the law was intended. Many cases involving aggressive tax avoidance schemes go to court and when judgements are made those schemes then become tax evasion. Many places now have general anti-avoidance laws which automatically consider aggressive tax avoidance to be tax evasion.

[Forty Two]

Avoiding taxation is great. It means not paying what is not owed. I doubt you're too keen on paying more than the law says you owe, right?

There is a move afoot (or at least it has been suggested) to class tax avoidance as a criminal offence - the same as tax evasion.
To do away with 'tax avoidance' completely...

What a good idea!

What's the definition of "tax avoidance" in your locale?

Here it includes such things as lawful tax deductions, exemptions, and credits.

Evasion means illegally failing to pay taxes.

Avoidance means legally not paying taxes.

So, how much tax do you pay if you are not allowed to not pay taxes, even if you legally don't owe them? LOL.

That's an overly simplistic view of tax avoidance. Tax compliance is a better term for make use of lawful deductions where there is no risk of it being considered unlawful.

Well, when the laws or regulations are written in a way as to admit to more than one interpretation, or that reasonable minds may differ as to application of the law, there would be nothing criminal in attempting a deduction or something even if there is some risk of it being denied.

Tax avoidance is making use of loopholes,

A loophole is another word for a lawful means of not paying tax. I'm not in favor of loopholes, per se, so, close 'em up!

making multiple transactions that serve no purpose other than to avoid tax, doing things that could be argued are technically legal but are not the spirit of how the law was intended.

Well, surely you see how behavior that is legal, but in one or another person's view is "not in the spirit" of the law is still legal. We can't really run a fair legal system on the "spirit" of the law where that spirit is not in accord with the letter. In many, many instances a law can have a reading which does not seem to be in line with what a reasonable person would intend, because opinions vary. But, you can't proceed figuring the spirit will save you. You also should be able to proceed based on the letter of the law, even if the spirit would seem to convict you. That's a recipe for arbitrary justice.

Many cases involving aggressive tax avoidance schemes go to court and when judgements are made those schemes then become tax evasion. Many places now have general anti-avoidance laws which automatically consider aggressive tax avoidance to be tax evasion.

Indeed. And, the government bears its burden to prove beyond a reasonable doubt that the scheme was criminal.

I'd have to read the text of the "aggressive tax avoidance" law. There would, I'm sure, be some reasonable specificity to provide taxpayers fair notice as to what conduct is being criminalized.

[Strontium Dog]

Then, of course, in the UK, the tax authorities have had their staff cut due to 'austerity' (a capitalist wheeze) that they are reduced to 'bargaining' with corporations on how much tax they should pay out of the total tax due.

And yet, corporation tax receipts are at a record high.

[pErvinalia]

Avoiding taxation is great. It means not paying what is not owed. I doubt you're too keen on paying more than the law says you owe, right?

There is a move afoot (or at least it has been suggested) to class tax avoidance as a criminal offence - the same as tax evasion.
To do away with 'tax avoidance' completely...

What a good idea!

What's the definition of "tax avoidance" in your locale?

Here it includes such things as lawful tax deductions, exemptions, and credits.

Evasion means illegally failing to pay taxes.

Avoidance means legally not paying taxes.

So, how much tax do you pay if you are not allowed to not pay taxes, even if you legally don't owe them? LOL.

That's an overly simplistic view of tax avoidance. Tax compliance is a better term for make use of lawful deductions where there is no risk of it being considered unlawful.

Well, when the laws or regulations are written in a way as to admit to more than one interpretation, or that reasonable minds may differ as to application of the law, there would be nothing criminal in attempting a deduction or something even if there is some risk of it being denied.

Tax avoidance is making use of loopholes,

A loophole is another word for a lawful means of not paying tax. I'm not in favor of loopholes, per se, so, close 'em up!

making multiple transactions that serve no purpose other than to avoid tax, doing things that could be argued are technically legal but are not the spirit of how the law was intended.

Well, surely you see how behavior that is legal, but in one or another person's view is "not in the spirit" of the law is still legal. We can't really run a fair legal system on the "spirit" of the law where that spirit is not in accord with the letter. In many, many instances a law can have a reading which does not seem to be in line with what a reasonable person would intend, because opinions vary. But, you can't proceed figuring the spirit will save you. You also should be able to proceed based on the letter of the law, even if the spirit would seem to convict you. That's a recipe for arbitrary justice.

Many cases involving aggressive tax avoidance schemes go to court and when judgements are made those schemes then become tax evasion. Many places now have general anti-avoidance laws which automatically consider aggressive tax avoidance to be tax evasion.

Indeed. And, the government bears its burden to prove beyond a reasonable doubt that the scheme was criminal.

I'd have to read the text of the "aggressive tax avoidance" law. There would, I'm sure, be some reasonable specificity to provide taxpayers fair notice as to what conduct is being criminalized.

It's not just a case of saying "it's legal therefore it's ok". It's a case of updating laws to better reflect modern commerce. Earning money in one country but moving it around with accounting tricks so that it is taxed in another (cheaper) country is legally ok, mostly because tax codes were written before globalisation came to dominate. But it's clearly not the intent of a country's tax code to allow someone to earn income and not pay tax on it.

[JimC]

For multi-national corporations, the old saw "nothing is true except for death and taxes" has disappeared - corporations (until the revolution) are immortal, and, in many jurisdictions, they don't pay any tax either...

[Tero]

So I should buy stock in the biggest corporations, Exxon-Mobil?, because they will never go bankrupt or sink like the US $ ?

[rainbow]

...no one ties to escape free market capitalism

The reason no one tries to escape free market capitalism is that it doesn't exist.

Well, it does, in the real world.

No it doesn't.

I've already explained this to you, but you are not applying your mind.

If you're dealing with some sort of absolutist mindset, where your definition of free market capitalism is an anarcho-capitalist, stateless society where there are no laws or regulations on the market, then, sure, that imaginary world does not exist. However, to be free market capitalist does not necessitate anarchy or lawlessness.

Straw man.
Please at least try to make an argument if you can.

Hong Kong, Singapore, Australia, New Zealand, Switzerland, United States.

Your point?

On the flip side, North Korea, Venezuela, Cuba, Republic of Congo, and Eritrea, have virtually no market economy.

State Capitalism and no free market. What point are you trying to make?

[JimC]

rainbow, I think labelling certain countries as "state capitalism" ignores the fact that their initial, and clearly stated ideology was socialist. Whether it is actually better described as state capitalism is a moot point - to a degree, those 2 words are mutually inconsistent.

[mistermack]

I would shift the burden of proof in tax cases to the tax payer.
If it looks like an attempt to avoid tax, the revenue should be able to say, 'you prove it wasn't'.

After all, it's you who chose to arrange your own financial affairs. If it's got legit reasons behind it, you should know them.

If you can't prove good faith, you lose the cash and pay the costs.

That would be a good deterrent.

[Alan B]

I think I would go along with that. Paying tax should be a 'rubber stamp' exercise. Any disagreement should be raised by the payer. If proved correct then the payee stumps up the costs (if it goes to court). If incorrect, well then, tough, pay up!

[Brian Peacock]

Capitalism isn't about minimising, alleviating, or avoiding poverty, but maximising capital resources.

[Forty Two]

For multi-national corporations, the old saw "nothing is true except for death and taxes" has disappeared - corporations (until the revolution) are immortal, and, in many jurisdictions, they don't pay any tax either...

This is largely a myth. Corporations generally pay large amounts of tax.

[Scot Dutchy]

When they get caught yeah.

[Forty Two]

...no one ties to escape free market capitalism

The reason no one tries to escape free market capitalism is that it doesn't exist.

Well, it does, in the real world.

No it doesn't.

I've already explained this to you, but you are not applying your mind.

You've explained your view, but you're wrong. A free market does not equate to absolutely no government or regulation over commerce. A free market capitalist system requires some regulation and legal structure to exist in the first place. For example, Laws defining property and laws regulating commercial transactions do not necessarily render a market not free. The freeness of markets comes in degrees.

[

If you're dealing with some sort of absolutist mindset, where your definition of free market capitalism is an anarcho-capitalist, stateless society where there are no laws or regulations on the market, then, sure, that imaginary world does not exist. However, to be free market capitalist does not necessitate anarchy or lawlessness.

Straw man.
Please at least try to make an argument if you can.

I find your arguments to consist mainly of making declarations and then repeating the mantra that you've "explained" it already. I have made an argument as to why free markets do exist. I've repeated the argument a couple of times, and yet you continue to simply declare yourself right. I've not seen a rebuttal to my post.

Perhaps we can look at it this way - if you say I've strawmanned you on what a free market is, then by all means, provide your definition of "free market capitalism." We may be operating under different premises.

[

Hong Kong, Singapore, Australia, New Zealand, Switzerland, United States.

Your point?

They have economies that are considered free market capitalist. They exist.

[

On the flip side, North Korea, Venezuela, Cuba, Republic of Congo, and Eritrea, have virtually no market economy.

State Capitalism and no free market. What point are you trying to make?

Communist, no free market. That's why I said it was the flip side. They exist too.

[Forty Two]

Capitalism isn't about minimising, alleviating, or avoiding poverty, but maximising capital resources.

It's a byproduct of capitalism.

Intent is irrelevant. Results are relevant.