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TW Ed wonders how much 17th century thinking guides today's tax policy.

Jean-Baptiste Colbert, 17^th century French finance minister, is reported to have advised,

"The art of taxation consists in so plucking the goose as to obtain the largest amount of feathers with the least possible amount of hissing"

This maxim appears still to hold good – or at least to guide the thinking of the tax authorities. Consider the rise of the so-called “stealth” taxes under a succession of governments: the increases in National Insurance, VAT, and duties on alcohol and cigarettes. (And innovations such as Insurance Premium Tax, Machine Games Duty, Air Passenger Duty...)

While these taxes are collected by businesses they are, with the exception of NIC, taxes on consumers – although businesses would argue that they too bear some of the cost rather than pass it on to the consumer in full.

Last Monday's Panorama programme did well to draw attention to the contrast – and the conflict – between the Treasury’s desire to be “competitive” and “attractive” to big businesses, and its stated position on whatever it perceives as tax avoidance – and the need to generate as much tax revenue as possible.

Large multi-national enterprises would argue that they are unfairly criticised merely for applying the rules as understood and intended but might get little sympathy from smaller, local businesses.

A broadly similar argument applies for individuals, only a few of whom can benefit from lower taxes overseas (and, for instance, the Liechtenstein Disclosure Facility ) while most taxpayers have to make do, and live with the Granny Tax, the Pasty Tax, the Bedroom Tax...

Is the Treasury reaching the limit of how much it can tax without too much negative publicity? Or is it more the apparent leniency shown to the geese who can fly away? Whichever, it is good that taxpayers are becoming better-informed and asking, what is this “fair” share I am being asked to pay?

Regards all,

TW Ed