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Saturday, 22 September 2012

Tax Evasion

The Economist, of all sources, does a good job of exposing the legerdemain of confusing tax in general with in come taxes.  The article focuses on America, but really this confusion was pioneered by Mrs Thatcher and Geoffrey Howe in the early 1980s.

Basically, a successful confidence trick is pulled off where income taxes (inherently progressive) but paid by all but the poorest are defined as "real tax".  Other taxes, like VAT, are ignored despite everyone paying a flat rate and the tax base being broader. Hence the poor are stereotyped as parasites.

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