Andrew Goodall

on taxes and more or less related stuff

Climate change sceptics and the precautionary approach

Hugo Rifkind is depressed. Everyone has a reason for thinking they're right, he says. "On climate change, though, I just can't see it." Rifkind says in today's Times:

"If Copenhagen collapses, that's a triumph for the layman sceptic, newly armed with their half-understood leaked emails from the University of East Anglia."

He complains about the quality of debate but does nothing to enhance it when he asks:

"Layman sceptics, how did we end up with those? They're depressing enough in themselves. They're a sign that the internet has not raised the quality of debate, but lowered it to a bicker. Maybe that's the future. People who know slightly more than nothing, shouting."

Everyone has a reason to be sceptical, and some sceptics know more than others. They have a right to be heard. But Rifkind has a point when he adds:

"What gives them the nerve? If they doubt the science, with the stakes so high, how can they not doubt themselves? How can they not wake up at night, dripping in sweat, suddenly wondering if, for the sake of a snappy column or a pithy post on a blog, they've just helped to drown their own great-grandchildren?"

This is another way of saying something that I don't think I've read or heard for a while, but it deserves a hearing. It's about the precautionary approach.

The fact that the Copenhagen conference is happening at all shows that the vast majority of scientists and policymakers all over the world accept that something must be done to avoid catastrophic climate change. If I was not convinced of that I would have to ask myself, in the face of the "overwhelming" evidence:

"What if I'm wrong?"

As a CAFOD volunteer I was interested to see CIDSE, a coalition of 16 Catholic development agencies, say this in a November 2008 policy paper:

"CIDSE underscores the precautionary approach affirmed by the UNFCCC and believe that enough is known to justify and obligate preventive action on climate change, in particular because of its disproportionate and devastating impact on the poor."

The United Nations Framework Convention on Climate Change said at Article 3.3:

"The Parties should take precautionary measures to anticipate, prevent or minimize the causes of climate change and mitigate its adverse effects. Where there are threats of serious or irreversible damage, lack of full scientific certainty should not be used as a reason for postponing such measures, taking into account that policies and measures to deal with climate change should be cost-effective so as to ensure global benefits at the lowest possible cost."

There you are. Lack of full scientific certainty should not be used as a reason for postponing such measures. It makes sense because there is only one chance to get this right. It makes sense because no-one can prove what will or will not happen, but we get only one chance. As Bryan Appleyard put it, in the Sunday Times:

"The climate is warming. It is almost certain this is caused by emissions of greenhouse gases caused by human activity. Nobody has come up with an alternative explanation that stands up. If the present warming trend continues, nasty things will probably start happening to humans within the next century, possibly the next decade. Something must be done. If nothing is done, then the benign climatic conditions that have sustained human civilisation for 10,000 years are in danger of collapse to be replaced by ... well, write your own disaster movie. You will note that there is some wiggle room in these statements. It is 'almost certain' that humans are responsible; nasty things will 'probably' happen. That is because all science can ever be is the best guess of the best minds."

11 December 2009 in Africa, CAFOD, Catholic Church, Climate change, Developing countries, Environment, Government, Poverty | Permalink | Comments (0)

Government has yet to deliver ‘joined-up’ services for bereaved people, says LITRG

The government could do “much more” at “low or negligible” cost to help people who are bereaved, according to a new report based on research provided by the advice charity TaxHelp for Older People.

The report published by the CIOT’s Low Incomes Tax Reform Group makes 12 recommendations aimed at making better use of government systems and reducing the number of contacts people need to make with agencies “at a difficult and stressful time”.

The government should roll out the Tell Us Once pilot nationwide and involve HMRC in its development, and HMRC should offer face-to-face help and home visits to vulnerable taxpayers or fund the voluntary sector to do so, LITRG said. “A working party should be set up to consider how best to achieve an ‘end to end’ government service to the bereaved, and to maintain a high standard of service to the bereaved and other vulnerable customers in the context of the new Department of Work and Pensions and HMRC Charters.”

This week’s issue of Tolley’s Practical Tax newsletter has more on this and other developments including:

· HMRC discovery powers – Iain Macleod of EDF Tax examines recent developments in relation to self assessment, enquiries and discovery;

· HMRC extends “new disclosure opportunity” deadline;

· Advisory fuel rates increased from 1 December;

· HMRC sets up helpline for flood victims;

· HMRC anticipates 64-8 rush;

· Tax law rewrite – final bills launched;

· Keep a careful note of your call, says LITRG.

03 December 2009 in Government, HM Revenue and Customs, Published work, Taxes, Tolley's Practical Tax | Permalink | Comments (0)

Accountants read tax book in bed, allegedly

Having worked on the annual update of Tolley's Tax Guide I was interested to see The Motley Fool describe the book yesterday as "the accountant's favourite bedtime reading". Now the book may be good, but it's not that good, surely? Wouldn't it be better left at the office to be picked up again after a good night's sleep? The Fool may be joking, of course. A poll might be in order but how many accountants would put the book down for long enough to take part?

26 November 2009 | Permalink | Comments (0)

Tax body welcomes ‘much improved’ charter

HMRC's new charter will go a long way towards helping the government realise its commitment to making the tax system "as useable and accessible as possible" for individuals, businesses and other organisations, Stephen Timms, the financial secretary to the Treasury, declared. The Chartered Institute of Taxation's policy director, John Whiting, said the charter was "an important step forward in relations between taxpayers and the taxman" and would help people in their dealings with HMRC. The CIOT had said the first draft was deeply disappointing and wholly inadequate.

This week's issue of Tolley's Practical Tax newsletter has more on this and other developments including:

  • The pre-budget report is expected to target "aggressive planning" – tax advisers plan for higher taxes as TUC calls for cap on tax reliefs;
  • "False self-employment" proposals are at odds with reality, says LITRG;
  • Childcare vouchers – parents continue to lose out;
  • HMRC hits YouTube;
  • Code of practice "gives HMRC officials a quasi-judicial role" says Law Society;
  • Case summaries – inheritance tax, judicial review, seafarer's earnings, capital gains tax, liability to tax on pension.

     

20 November 2009 in HM Revenue and Customs, Published work, Taxes, Tolley's Practical Tax | Permalink | Comments (0)

The cost of corporate tax avoidance

Britain's tax havens and offshore financial centres must meet international standards on tax transparency, financial sector regulation and financial crime if they are to continue to hold themselves out as internationally active financial centres, the Foot review concluded.

Michael Foot's report for the UK government recommended that nine jurisdictions, including Guernsey, Isle of Man, Jersey and the British Virgin Islands, consider developing a diversified tax base to maximise sources of revenue. He commissioned Deloitte to conduct an evaluation of the "importance" of the Crown Dependencies (CDs) and Overseas Territories (OTs) in tax avoidance by UK corporates.

Corporate tax avoidance costs the UK less than £2bn, the firm estimated. "Deloitte tentatively concluded that the [CDs and OTs] were distinguished within the developed world by differentiating themselves from the international consensus, sometimes through tax rates but more often through the absence or near absence of certain forms of taxation," Foot said. "Whilst there were other drivers for doing business in these jurisdictions … tax was an important motivating factor."

Deloitte estimated that the amount of UK tax avoided by UK corporates using the nine jurisdictions was likely to be "significantly lower" than estimates produced by previous studies had suggested. The firm said: "We estimate the total UK corporation tax potentially lost to avoidance activities to be up to £2bn per annum, although it could be much lower, with avoidance through the CDs and OTs being an unidentified sub-component."

The TUC estimated in 2008 that the UK revenue loss from corporate tax avoidance was £11.8bn per annum.

Critics questioned Deloitte's analysis and the Tax Justice Network pointed out that the report focused on risks posed by the centres' activities to themselves and to the UK. "It simply ignores the elephant in the room: what about the damage these places cause to the rest of the world?" the TJN asked. Richard Murphy, the anti-avoidance campaigner and adviser to the TJN, claimed that Foot had produced "a weak apology for a report".

Tolley's Practical Tax newsletter (6 November) has more on these and other developments including:

  • Avoidance and evasion "in any form" will not be tolerated, says the financial secretary to the Treasury;
  • Treasury consults on small companies rate rules;
  • Scrap measures to counter "false self-employment", says CIOT;
  • Compliance reforms call for vigilance – a round table discussion hosted by the Tax Journal reviewed practical issues arising from the latest developments in tax investigations; and
  • Expatriate tax and NIC update – Amanda Sullivan reports on October 2009 meeting of the Joint Forum on Expatriate Tax and NICs.

11 November 2009 in Developing countries, Government, HM Revenue and Customs, Poverty, Published work, Taxes, Tolley's Practical Tax | Permalink | Comments (0)

Advisers urged to defend ‘reputable’ tax planning

The possibility of a general anti-avoidance rule needs to be re-examined, one of the UK's leading tax experts has told Tolley's Practical Tax newsletter. John Whiting, tax policy director at the Chartered Institute of Taxation, was responding to a call by Taxation editor Mike Truman for the enactment of principles established in a series of court cases in which aggressive tax avoidance schemes were held to be ineffective.

Truman said tax professionals needed to decide which types of tax planning were "defensible".

Whiting said "most people" question whether tax advisers should devise artificial, aggressive avoidance schemes. Asked if he agreed that a GAAR was inevitable, he told TPT: "I think the issue needs looking at again, as the situation is becoming difficult."

Mark Lee, chairman of the Tax Advice Network, welcomed Truman's comments. "I'm delighted to see such a high profile commentary on this matter," he told TPT.

Next week's issue of Tolley's Practical Tax newsletter (23 October) will have more on this and other developments.

See also ...

Mark Lee: Too many marginal tax products are sold to too many unsuspecting people

Richard Murphy: Time for a General Anti-Avoidance Principle

16 October 2009 in Banks, Government, HM Revenue and Customs, Published work, Taxes, Tolley's Practical Tax | Permalink | Comments (0)

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