Below is the text of a letter, signed by Church Action for Tax Justice and a coalition of organisations, calling on the government to apply socially responsible conditions to corporate bailouts. We believe that now is the time when in exchange for taxpayer money, we can ensure that companies pay their fair share of tax, prioritise people and planet over profit, and ensure fair pay conditions.
The Rt Hon Boris Johnson MP
10 Downing Street
Cc: Rt Hon Rishi Sunak MP, Rt Hon Sir Keir Starmer MP, Rt Hon Ian Blackford, Rt Hon Sir Ed Davey MP, Elizabeth Saville-Roberts MP, Caroline Lucas MP
3 July 2020
Business bailouts must build an economy that works for everyone
Dear Prime Minister
The Government yesterday announced a bailout loan for Celsa steel, including conditions for the company on employment, climate change and tax use. This is bold action to support a vital business for the UK economy. But as we wait for full details of the loan conditions, we are concerned that all future Government support for businesses serves the wider public good.
Deciding to bail out major companies offers a crucial moment for redefining the rules of business behaviour in the post-Covid economy. Will we prioritise a fairer, more secure and sustainable economy, or will we deepen existing inequalities and increase our vulnerability to shocks?
We believe that all bailouts should be conditional on meeting wider social goals. Public money must not be channeled into inflated executive salaries. Climate targets and environmental protection must be hardwired into business performance. And companies must commit to building a healthier, more equal society: paying their share of tax, creating good jobs that are paid fairly, and eliminating racial, as well as gender, discrimination in their pay structures.
This is the moment for a new deal that prioritises what matters most to ordinary people: their pay, their taxes, the natural world around them, and equality within their communities. As such, we ask that any businesses receiving financial support must be required to:
In addition, Government must conduct a meaningful Equality Impact Assessment of all business support programmes and must publish the findings.
The Covid-19 pandemic has highlighted in stark relief the inequality and fragility in our economy. Going back to ‘normal’ would only leave us more vulnerable to future shocks. We call on you to ensure that businesses play their part in building a more secure, fair and sustainable future for everyone.
Carys Roberts, Executive Director, Institute for Public Policy Research
On behalf of
Dr Justin Thacker, National Coordinator, Church Action for Tax Justice
Rob Harrison, Director, Ethical Consumer
Paul Monaghan, Chief Executive, Fair Tax Mark
John Sauven, Executive Director, Greenpeace UK
Luke Hildyard, Executive Director, High Pay Centre
Miatta Fahnbulleh, Chief Executive, New Economics Foundation
Robert Palmer, Executive Director, Tax Justice UK
Richard Murphy, Director, Tax Research UK
Dr Wanda Wyporska, Executive Director, The Equality Trust
Dr Katherine Trebeck, Advocacy and Influencing Lead, Wellbeing Economy Alliance
Mary-Ann Stephenson, Director, Women’s Budget Group
Will Stronge, Director, Autonomy
Danielle Paffard, Build Back Better
Neil McInroy, Centre for Local Economic Strategies
Mathew Lawrence, Director, Common Wealth
Colin Hines, Convenor, Green New Deal Group
Hannah Martin, Co-Exec Director, Green New Deal UK
Fran Boait, Executive Director, Positive Money
CALL to ACTION: Write to the chancellor
The US is pulling out of the negotiations that might have reformed global tax rules. We are asking our supporters to write to the chancellor to ensure that Britain does not give in to these US tactics and that we prioritise the needs of developing countries in the discussions.
Template letter for chancellor
Global Tax Rules - what next?
In the last couple of weeks there have been widespread news reports that the US is pulling out of the global tax rules negotiations. These discussions have been taking place at the OECD (Organisation for Economic Cooperation and Development) under the title of the BEPS 2.0 inclusive framework.
It is widely accepted that the current rules for how large multinational corporations are taxed are not fit for purpose. The fundamental problem is that it is very easy for companies that make money in one country to declare that profit in another. If the country where they declare that profit is in fact a tax haven (a country that charges little or no corporation tax) then the company pays very little (if any) tax on its profits.
Globally, this behaviour is estimated to cost the world upwards of $600bn each year, approximately 20% of global tax revenues. For developing countries this loss is especially problematic as they do not have large tax revenues in the first place, and so as a proportion of their overall tax income the losses from tax dodging impact them especially hard. Estimates vary but currently, it is suggested that developing countries lose anything from $200-400bn every single year. This is significantly more than those countries receive in foreign aid.
In light of this, it is essential that any reform of the global tax rules must put the needs of developing countries first. If they really did receive the tax that they are owed then it’s possible that the Sustainable Development Goals could be achieved, and extreme poverty eliminated. This is the prize that genuine reform of global taxation holds out for us.
However, the withdrawal of the US from these negotiations has certainly made the prospect of a good outcome far less likely. In their communications about withdrawal, it is not entirely clear if the the US is merely asking for a ‘pause’ while we all get to grip with Covid-19 or whether they are pulling out entirely. It is certainly clear that they have withdrawn because they are not getting their way.
For this reason, we are asking our supporters to write to the chancellor to encourage him to continue the negotiations, but to do so in a way that prioritises the needs of developing countries. There is a serious proposal on the table, led by the G24 group of developing and emerging economies that would have created a fairer global tax system. The UK government should seriously consider it.
At the same time, in April this year, a 2% digital services tax came into force in the UK. This tax specifically targets the giant tech companies (such as Facebook, Google, Amazon) that make profit from UK consumers but who pay relatively little tax in the UK. The US has threatened retaliatory action against countries that impose such unilateral digital services taxes, but we need to ask our chancellor to stay strong and not give in to such tactics.
We have therefore provided a template letter that supporters can use to write to the chancellor, and we would encourage you to use it.
A Statement from Church Action for Tax Justice in light of the Coronavirus Pandemic (June 2020)
The British public believe in fairness. Everyone has the right to benefit from society, and everyone has a responsibility to contribute to it. We see this sense of fairness enshrined in our public services. This has been especially the case in respect of our NHS where the same healthcare is available to all free at the point of delivery.
Yet there are some aspects of our community life that seem especially unfair, and one of these is our tax system. The simple fact is this: our tax system disproportionately favours the wealthy and harms the poorest in our society. Consider the following:
What does this mean in practice?
It means that the average cleaner in the UK is paying more in tax as a proportion of income than the average CEO whose office is being cleaned. It means the average security guard pays a higher rate of tax than the average executive whose building they are keeping safe. This is fundamentally unfair.
The British public think so too.
In our survey of over 1,000 working age adults 80% thought that tax avoidance was morally wrong. This belief was true right across the political spectrum from Conservative to Labour, from Remain to Leave. It was true in every age group and across genders. It is very unusual for the British public to be so united on a single moral issue. Yet this is what we found. And when asked why they thought it was wrong, it was the issue of ‘fairness’ that was top of their list with 75% stating that we all need to pay our fair share.
So why does fairness matter? Because contributing a fair share is how we create a fairer world.
A sense of equality and justice is at the heart of who we understand ourselves to be. We believe that everyone is equal, that no-one is above the law, that if there is a rule – such as pay your taxes – then everyone must follow it. From a Christian point of view, this idea reflects the equality that is ours by virtue of being created in the image of God. In the ancient world, the concept of the divine image was reserved for the supreme ruler, but in the pages of Genesis the divine image is conferred on everyone. Under God, we are all of equal worth and dignity.
This is why our scriptures repeatedly find ways to encourage the sharing of resources for the benefit of all. We see this in the Jubilee principles when every 50 years all debts were to be cancelled; we see it in the Early Church (Acts 2) when people sold land and property and distributed proceeds according to need; and we see it in Paul’s letter to the Corinthians when he tells them “the goal is equality”.
At the same time, the Scriptures are also frequently full of condemnation for those who have made a god out of greed, selfishly hoard their wealth, exploit their workers and fail to pay what they owe either to the ruling authorities or their workers. The World Council of Churches, the World Alliance of Reformed Churches and others have conceived the idea of a ‘Zacchaeus Tax’, from the story of the tax collector who gave back four times over what he had cheated on the taxes he levied.
In response, then, Church Action for Tax Justice is calling for the following measures to be implemented to ensure that everyone pays their fair share, and so that we see a fairer world, one which is more equal and just, especially in this time of crisis:
These objectives are based on those developed by a coalition of tax justice organisations. However, this formulation belongs to CATJ alone. For the more widely agreed Statement see the website of Tax Justice UK in due course
 http://www.taxresearch.org.uk/Documents/WealthTaxData420.pdf References for other points available on request
Tax Justice is “the moral issue of our time”
Ahead of Tax Justice Sunday (14th June 2020), Church Action for Tax Justice has released new polling which details the extent to which the British public consider tax avoidance as the moral issue of our time.
In a survey of over 1,000 UK adults, 80% consider tax avoidance to be morally wrong. In an era when the British public have very few shared moral commitments, it would seem that our moral responsibility to pay our taxes is one of those on which the vast majority of us are agreed.
The survey also showed their reasons for thinking this way – that fundamentally it comes down to an issue of fairness. 75% of those who thought tax avoidance was morally wrong said that this was because we all need to “pay our fair share”. In contrast, just 53% viewed it in terms of tackling inequality and 65% because of the tax contribution to public services.
To accompany these findings, Church Action for Tax Justice have released their Coronavirus Statement calling on the government to ensure that everyone pays A Fair Share for a Fairer World. As part of their statement, and in the context of coronavirus, they are calling for greater tax transparency, the imposition of conditions on corporate bailouts, an excess profits tax, greater support for poorer countries, a clamp down on tax dodging, equalisation of taxes and consideration of an annual net wealth tax. All of these measures are in line with the public’s belief about the immorality of tax avoidance.
Importantly, the agreement in the poll spanned all ages, genders and political affiliation with 84% of Conservative voters and 82% of Labour voters viewing tax avoidance as morally reprehensible. By way of comparison, the figure of 80% was significantly greater than the proportion who thought taking illegal drugs was wrong (72%), or failing to recyle (69%).
Commenting on the findings, the Bishop of Leeds, Rt Rev Nick Baines said “The current crisis is exposing the lack of fairness and equity in our economic system. There is also a clear perception that, as we move into an uncertain future, we need an equitable tax system. We need to stop the tax dodging and we need to see a greater degree of tax justice in our country. I wholeheartedly commend this statement from Church Action for Tax Justice.”
David Haslam, Chair of Church Action for Tax Justice said “Our survey findings make clear that tax is the moral issue of our time. Now people have become aware of how much the wealthy cheat on their taxes they need to see justice done.”
The survey was conducted by Survation and took place 22 – 26th May 2020 via an online panel and consisted of 1,034 UK residents aged 18+. The results of the survey are available here.
Contact for further information:
Notes to editors:
Church Action for Tax Justice (CATJ) is an ecumenical, campaigning organisation that stands for a fairer and more effective tax system, where democratic governments set taxes to reflect the Common Good, and individuals and corporations pay their share.
Our Letter in The Times
This morning The Times newspaper printed a letter we had drafted calling on the government to pursue a fairer tax regime in light of the covid-19 epidemic. The original text of the letter and its signatories are reproduced here:
We welcome the decisions of the Danish, Polish and French governments to refuse corporate bailouts for corporations registered in tax havens. The current crisis has shown the importance of our health and social security systems – and the taxes that pay for them year in and year out.
However, many of the most vulnerable people in our society are paying the price for a health and welfare system woefully unprepared for an epidemic. Meanwhile, some large corporations continue to avoid responsibility, making huge profits yet hiding their wealth in tax havens.
Over 80% of the British public believe that legal tax avoidance is morally wrong. This crisis demonstrates why they are right.
Today at least $8tn sits offshore, with its wealthy owners hiding from their tax and social responsibilities. Developing countries, who face problems from COVID-19 on a scale unimaginable in the richer nations, are deprived up to $400bn every year by tax avoidance.
When the pandemic ends we cannot go back to business as usual. If we are to build an economic system which prioritises the wellbeing of people and the planet then a fair tax system where all, including powerful corporations and wealthy individuals, pay their fair share is essential.
Specifically, this means that wages and working conditions are just and that we have a tax system in which big corporations and wealthy individuals can no longer dodge the taxes they should have paid.
We call on our Government to foster such a fair tax system that no longer only favours the excessive individual and corporate wealth of some, but serves the common good of all.
Lord Rowan Williams – former Archbishop of Canterbury
Lord Richard Harries – former Bishop of Oxford
Revd Dr Barbara Glasson, President of the Methodist Conference
Rev. David Mayne - Moderator, the Baptist Union Council
Paul Parker – Recording Clerk, Quakers in Britain
Mr Derek Estill, Moderator of the General Assembly of the United Reformed Church
Revd Nigel Uden, Moderator of the General Assembly of the United Reformed Church
David Haslam, Chair, Church Action for Tax Justice
The letter has been picked up and commented on by the following news outlets:
Tax Justice in a Time of Crisis
When the UK Prime Minister, Boris Johnson, was recently admitted to hospital with covid-19, spending a few days in intensive care, a number of British politicians and journalists talked about how the virus was the great leveller. Everyone from street cleaners to world leaders could get the disease, no-one was immune, therefore, we must all follow the same social distancing guidelines. But of course, as Iñigo Aymar of Oxfam has pointed out, covid-19 is not so much the great leveller, but the great revealer.
It has not demonstrated how we are all the same but has instead revealed how we are all very different. For the true significance of the crisis is the inequities it has highlighted in our social and economic landscape. One of the most striking of these are the financial inequalities that preceded this crisis. The most recent Oxfam inequality report showed us that just 22 men held the same wealth as all the women in Africa, and that if we taxed an additional 0.5% on the wealth of the richest 1% that could pay for the 117 million jobs in healthcare, education and social care globally that are required to deliver the SDGs. Such huge wealth disparities mean that as millions lose their jobs in response to coronavirus, the impact of that financial shock will not be felt equally. It is simply shocking that in their economic responses too many governments seem to be more concerned about the price of shares than the price of bread, more concerned about falling stocks for the wealthy than rising deaths among the poor. If you’re sitting on billions and lose a million or two your fundamental livelihood will not change; if you’re just about managing, but lose your job – especially in a country with an inadequate safety net – then your very life will be threatened.
Perhaps most troubling it has also revealed the global inequalities in our health systems. Many so-called developed countries have been able to rapidly scale up their existing, relatively strong healthcare provision especially in regard to intensive care beds. The United Kingdom has built a series of new hospitals in just weeks providing hundreds of extra ventilators for the most seriously ill. Inevitably, this will mean fewer deaths overall. By way of contrast, while Kenya has just a couple of hundred ventilators for approximately 50 million people, the UK has several thousand for a similar size population and these are being rapidly increased to tens of thousands.
In response to all this there is then an urgent need to develop both an immediate response but also a longer-term reframing of our economic and political systems. A number of excellent proposals have been made as to how to do this, especially in regard to cancelling global south debt, but I want to focus on how we can use the tax system to generate a more just political economy.
1. Change the global tax rules
The first issue is that we need to change the global tax rules. It has been estimated that tax dodging by multinationals costs the developing world up to $400bn each year –three times the amount that is given in aid to those countries. Reform of these rules is currently being discussed in a process led by the OECD (Organisation for Economic Co-operation and Development). Proposals led by India, Colombia and Ghana on behalf of poorer nations will ensure that developing countries get more of the tax that they are owed but other proposals, including those of the US, will keep things as they are and developing countries will lose out. In light of coronavirus and its disproportionate burden on the poorer parts of the world it is imperative that when these rules are changed that this is done in such a way that poorer nations benefit the most, keeping much more of the tax that is owed to them.
2. Tackle the tax havens
At least $8 trillion is currently sitting in tax havens around the globe. Much of this money has been obtained by illicit means and / or by avoiding tax that should have been paid in other countries. Led by the UN, the global community could decide to tackle these offshore gold mines once and for all and so provide funds for tackling the current health crisis. This could involve a range of measures including one off (or even recurrent) taxes on net wealth such as Oxfam suggest; conditional corporate bail outs so that only those companies who refuse to use tax havens can access them; implementation of a global minimum corporate tax rate so that tax havens can no longer provide preferential rates; strengthening of national tax authorities so they can chase down those who hide their money offshore. As indicated, all of this activity could release billions of dollars to help fund a response to coronavirus
3. Institute an excess-profits tax
During the first world war, a number of Western governments instituted a temporary super-profits tax to help fund the war effort. Arguably, a parallel situation exists today. One of the things that is increasingly clear is that the impact of covid-19 is not being felt equally across the corporate sector. While many companies are struggling significantly with a loss of consumers, others are making huge gains in response to the crisis. Amazon, one of the worst corporate tax avoiders in the world, has seen its share price increase by over 30% and is currently making $11,000 a second from its customers. Government could then implement an excess profits tax – perhaps as high as 75% - on these extra profits, and then use that money to fund a global response to the crisis.
In 2 Corinthians 8:14 when the apostle Paul was encouraging the Corinthian church to help out their brothers and sisters in Jerusalem who were dealing with their own famine-related crisis he said “the goal is equality”. I think that can be our mantra too. In whatever way we respond to coronavirus, the goal must be an equitable financial, health and social system – a just world in which we all have a chance to survive, if not flourish. That is the goal for which we must strive.
Dr Justin Thacker
Church Action for Tax Justice
More people think cheating on your taxes is wrong than cheating on your partner!
Earlier this week, Tax Justice UK released a poll of over 3,000 people exploring their attitudes to a range of tax justice issues. The poll revealed significant support for changes to the UK tax system, but one of the most interesting findings was the overwhelming dislike of tax avoidance whether this was done by individuals or companies. When asked whether such behaviour, even if technically legal, was morally wrong 83.6% of the public thought it was wrong for companies and 79.9% thought it was wrong for individuals. Very rarely do the British public agree with each other about a moral issue.
To give these figures some perspective, in 2019 the BBC also ran a major survey of over 3000 people asking them about their moral beliefs on a list of topics. Below are the percentages of those that thought particular behaviours were wrong:
Indeed, it was hard to find a single moral issue that the public thought was worse than tax avoidance. While we acknowledge that the questions were asked in slightly different ways, if we compare these results then it would seem that a higher proportion of the British public consider tax avoidance wrong than the proportion who think cheating on your partner, taking illegal drugs or paying for sex are unacceptable. This is really quite remarkable given that at least one of these is definitely illegal.
It is even more remarkable given the fact that many accountants and lawyers still like to claim that there is nothing wrong with tax avoidance and promote their tax avoidance schemes with no shame. Can we imagine any respectable company doing the same in regard to drugs, prostitution or infidelity?
As a number of people have pointed out one of the problems with the government’s response to covid-19 is that though the corporate bailouts have been welcomed, they should have conditionalities attached. It is simply unacceptable that a company receiving large sums of public money should still be finding ways to avoid paying tax. Fair Tax Mark in particular have said that all companies receiving bailouts should “publish a binding tax policy that explicitly shuns tax avoidance and the artificial use of tax havens”. We agree with them and think the moral case for saying so is now indisputable.
2008 or 1945 - Which crisis will we follow?
I’m sorry that my ‘Thinking Lunch’ talk on Tax Justice has been postponed, but that’s the least of our concerns in these troubled times. Like everyone else, I’m stuck at home, and very thankful for the radio, TV and internet. I was on the rota for Southwark Cathedral where we’ve been maintaining the Daily Office and Eucharist, with no congregation but streamed on FACEBOOK, but even that has now been put on hold. Nevertheless, we can carry on at home the worship of God, and the prayers of the people and for the people.
I’ve been asked whether the text of my talk could be circulated by email, but as with so much else at the moment, it’s difficult to know what to say, and what to propose for the future, until we know when the present crisis will end, and what state our world, our nation, our economy will be in when we start getting back to normal.
But what is “normal”? Our last crisis, which now seems far less significant, was what happened to the Banks in 2008 and the threat of a financial meltdown. Then, as now, the Government intervened in order to prevent economic collapse. It bailed out the banks, but at a cost, neatly labelled “Austerity”, which has been borne largely by the poorer and more vulnerable members of society: benefits were frozen, public services were starved of funds, while Bankers’ bonuses were restored and the obscenities of corporate pay continued. And little has been done to stop companies and individuals who have the means to do so avoiding paying their fair share of tax.
If nothing else the present crisis makes it abundantly clear that the failure to establish a fair tax system which provides for the needs of everyone in society can have disastrous consequences. The Church Action for Tax Justice website - https://www.catj.org.uk/ - carries a damning statement from Pope Francis: “It has become evident that those who do not pay taxes do not only commit a felony but also a crime: if there are not enough hospital beds and artificial respirators, it is also their fault.”
So when all of this is over, will we just return to “normal”? Or could this be a moment, rather like 1945, when we look at the suffering and sacrifices which people have gone through, and ask what kind of world and economy we want to rebuild? Is it one where the rich must be allowed to flourish whatever the consequences for the poor? Or could it be one where the current rhetoric of “let’s come together” results in a much fairer, more equal society?
That would mean much lower differentials in pay, recognizing as we now do that care workers are more essential (and indeed skilled) than people who make a living by just moving money around. It means companies and wealthier people taking responsibility for the societies from which they benefit, and so paying more tax to sustain them. And it must mean looking again at those who are “at the bottom of the pile” – are they dispensable, or only entitled to what’s left over, or do we really belong together?
When we start to return to normality, there will be those who will say that the priority must be rebuilding the economy, encouraging business, and so the poor will need to wait until that starts to pay off. There is here a stark theological issue: is the world so evil than only by allowing inequality and injustice can there be, eventually and in some small measure, any hope for those left behind? To put it crudely, is the Christian belief in new life only a future hope for those who will die from the Corvid-19? Or does our Creator God, incarnate in our Saviour Jesus Christ, working now through the Holy Spirit, call us, and empower us, to start making that new life real in the present, in the way we organise our life together, including our economy?
What happened in 1945 was resisted by those with vested interests, and there have been many attempts since to undo the Welfare State, but who would now question the National Health Service? In our current crisis a Government is again intervening, this time to protect the economy, to hold society together and to care for those in greatest need. It can be done.
When we emerge on the other side of this dark period, the fundamental question will be: if we can do all of this when everyone is threatened, why can’t we do it in “normal” times, to create a society and economy where everyone matters? And more broadly - because all of this, including taxation, is more than a domestic issue - can we turn back from the “sceptered-isle” nationalism which has recently driven our country and instead play a leading role, as again we did in 1945, in forming a new international order based on peace and justice – including fair taxation?
Michael Doe is Vice-Chair of Church Action for Tax Justice, and an Assistant Bishop in the Anglican Diocese of Southwark. He was due to speak at the St Albans ‘Thinking Lunch’ on April 2nd
Did the Pope really call tax avoiders
There’s been an interesting debate in the last few days as to whether Pope Francis really did call tax avoiders “murderers” in the context of the coronavirus pandemic. The Pope’s comment came in response to an Italian journalist who had written of the lessons he had learnt from the coronavirus pandemic. In responding, the Pope picked up one of the phrases used by the journalist and said “It has become evident that those who do not pay taxes do not only commit a felony but also a crime / murder [Italian delitto]: if there are not enough hospital beds and artificial respirators, it is also their fault.” The problem here is that some ambiguity is attached to the meaning of the word delitto. I am no Italian linguist but George Turner of Taxwatch has made the point that while reuters translated delitto as ‘crime’, it can also be translated as ‘murder’ and as such, the Pope is referring to those who avoid tax as ‘murderers’.
But is that possible? Is it right to call someone whose actions are somewhat remote from the harm they cause a ‘murderer’? Of course, in the history of the church and moral philosophy this is not a new problem. The hit-man who pulls the trigger is clearly a murderer, but what about the drug baron who orders the death? Clearly, they’ve committed a crime but are they still a murderer? Well in British law, they would certainly be convicted either for conspiracy to murder or as joint enterprise murderers. Either way, they can be classed as ‘murderers’. The case of tax avoiders however is more complex, and if one were to pursue a criminal case for the physical harm they have caused then if any charge is appropriate it is probably that of manslaughter (corporate or otherwise).
What makes this interesting in respect of the Pope is the parallels that can be drawn with the criteria for mortal sins, which is what murders obviously are. These are that they are grave, the person knew what they were doing, and did so with intent.
Tax avoidance is clearly grave. It is not mere tax planning. It is the deliberate act of failing to comply with the intention of parliament. In terms of intentional non-compliance, it might be compared to those who in the current crisis deliberately ignore the instructions we have all received to socially distance. Secondly, it requires that the person is aware of their actions – they know they will cause harm. It is here that the tax avoider might claim that they are simply trying to maximise their returns, and the harm that is caused by their theft from the public purse is not their responsibility. However, morally speaking wilful blindness is no defence. Wilberforce famously said “You may choose to look the other way but you can never say again that you did not know.” Surely, that is true of those who choose to avoid paying tax. Amongst other things, tax does contribute to the provision of public services. To choose to look the other way by stashing millions of pounds in a tax haven is to choose not to fund public services. This is full knowledge in Catholic terms. And finally, it requires intent – that is the person was not under duress, but wilfully chose the action they undertook. Their intent may not have been to harm others, but they certainly intended to hide wealth that could have helped.
So did the Pope call tax avoiders murderers? Well, possibly, and from a theological point of view I think it quite likely that there was a deliberate ambiguity in the words he used. For whether their actions amount to murder or a crime, they are still in either case a mortal sin deserving of judgement – both God’s and, especially in the present crisis, the judgement of us all.
SANDWICHES FOR THE COMMON GOOD
The Times, Saturday March 7th, 2020
I was recently in Westminster discussing economic policy with senior aides from one of our main parties. Suddenly, the leader of the party popped their head round the door – not to chip in with a nugget of wisdom – but to tell us there was some food left over next door from another meeting. Sharing a few sandwiches and crisps round the office is what any of us would do in similar circumstances. This story is only unusual because it involves the leader of a main political party. Now on the one hand, we can reduce such offers to their utilitarian basics as merely the provision of calories and gratification. But exchanging food, perhaps especially in an office environment, is more about the value of relationships than it is about nutrition. It’s a reflection of our shared humanity.
I mention all this because when Rishi Sunak stands up to deliver next week’s budget, a similar determination of the good life will be on the table and each one of us needs to decide how to partake. For on the one hand, it is perfectly possible to interpret the budget through an individualistic prism. Under this guise, we analyse it for what it will do to my personal tax liabilities, whether private or via corporate rates and reliefs. We similarly appraise its spending announcements as to whether they align with my priorities and interests. In this way, the whole of the budget is refracted through the lens of my individual concerns.
But there is an entirely different way to view it. For when the chancellor appears at the dispatch box he is, to some extent, meant to be representing the gathered will of the people. As such, we can point to a range of collective ideas that are the real significance of national budgets. The first of these is that what we tax and how we spend is making a statement about the values we hold as a society. Perhaps the obvious example here is education. I am yet to meet a single person who does not think that the public purse should fund the bulk of primary and secondary schooling. This is true even for those who do not (and may not ever) have children. Of course, it is partly because they benefit from having well-educated doctors, lawyers and accountants, but it is also because we recognise the inherent value of education itself. This is the point that the recent analysis of graduate earnings by the IFS failed to address. People do not just do degrees in order to earn more money. Some do them because of their intrinsic value. I certainly didn’t give up being a doctor to study theology because I thought it would make me money!
How we tax and spend also plays a role in addressing the common problems that we face. The two current threats are climate change and coronavirus. Both of these require a national (if not global) solution. Yet while the budgetary decisions surrounding them may or may not benefit me as an individual, they certainly benefit us as a collective. Indeed, if I have a certain level of health and wealth, then it is quite likely that extra taxation to fund an expanded NHS, or imposition of carbon taxes may well not be in my personal interest. Nevertheless, at a time like this, it would be a strange sort of parsimony that would not want to channel our spending in this way.
Perhaps, most importantly, taxation actually works as a stimulus for democracy itself. Democracy is far more than just voting; it concerns the sense the populace has that its own government is accountable, that in the end it is the people who are in charge. This, incidentally, is why you can engineer multi-party elections in countries without a history of them, but you cannot so easily engineer democracy. It is about hearts and minds as much as it is about ballot boxes. That is why taxation serves the purpose of democracy. We know that citizens who are taxed are also more likely to vote. It is one of the mechanisms they use to ensure their money is spent appropriately.
Social values, national challenges, the democratic ideal – none of these will appear on an individual utility calculus. They are all, instead, a reflection of the common good, that which we, as a society, have chosen to value. Next week’s budget will offer us a vision of who we are. In a time of national crisis, when the need for a collective vision is greater than ever, I seriously hope that a common purpose is what the chancellor lays on the table.
Dr Justin Thacker is the National Coordinator for Church Action for Tax Justice