Man’s most hated word: tax


By Gavin Jones

They say the only two certainties in life are death and taxes and who can dispute that. Monarchies, democracies, dictatorships and indeed all systems of government have relied on passing laws that allow them to extract as much money as possible from their citizens with the least fuss and reasons. more justifiable to do so. The elders did it and it continues with as much “creativity” today as it was yesterday. Income tax was first levied in Britain in 1799 by British Prime Minister Pitt the Younger in order to finance the Napoleonic wars. Needless to say, this was to be a temporary measure. Quite.

Since then, governments have used the “services” of accountants and lawyers to conjure up all kinds of additional money-making ideas: inheritance tax, capital gains tax and value added tax, being only three. The former has morphed from death rights, capital transfer tax and now inheritance tax, but in reality the end result is the same. This means that in Great Britain, on the death of a person, the State grants itself 40% of the value of its estate in excess of £ 325,000. You work for years to accumulate wealth, paying taxes along the way, and you are taxed again when you die like a last hurray. Good money if you can get it and the UK government certainly “gets” it. There are some allowances beyond that amount, but I won’t expand here.

The capital gains tax is another blow from the state which, in essence, charges the same punitive percentage of any gain made on the sale of an asset over the difference between its sale and purchase. Value added tax is something that means that an organization actually becomes an unpaid tax collector for the state by charging a certain amount on the goods it sells, deducting the amount it is charged. in turn by other companies providing goods and services and remitting the difference to the state.

I hasten to add that I am not an accountant, but I hope you get the gist of it. It is obvious to many that bookkeeping can be a sure-fire route to wealth and happiness. On this particular topic, it does appear to be the case with international tax “experts” who build vehicles for extremely wealthy individuals and conglomerates and in fact pay little or no tax on their profits. Their rates are stratospheric. The rich nations of the world recently agreed to some sort of comprehensive tax reform, but whether this will prove to be achievable in practice is another question. Rather, I suspect that this will not be the case and that individual countries will bend the rules as they see fit.

Closer to home, Cyprus has become just as creative in terms of taxation and has become, in a way, a safe haven with its attractive rates. Undoubtedly, some of the money that arrived on the island as a result of the discredited passport for the investment “plan” escaped the keen eyes of various governments and, as a result, those concerned avoided paying. taxes.

Lastly, the following is surely up there in the pantheon of creative tax collection and it just happens to be in my own backyard. A few days ago, I received an invoice from my local municipal council for the princely sum of 20 €: cemetery tax (sic). He said the proceeds collected would be used to purchase an area of ​​land for burial grounds. Let’s be clear here. The cemetery does not yet exist and yet they want money for its creation in the indefinite future. What sequel? Maybe I should be billed for my air consumption, possibly based on my water bill. Now it’s about being creative….

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