Channel 4's Dispatches on tax avoidance

I watched Dispatches last night on Channel 4.  You can watch it here.

There are real reasons to constantly monitor the use made of policy to check that, in terms of the benefits, the costs incurred are worth paying - in tax terms, we should constantly review the use made of all measures that accrue tax benefits to ensure that the costs are worth paying.  For this reason, my instinct is that the time for the distinction between residence and domicile for tax purposes is no longer fit for purpose and ought to be reviewed.

However, I have a real problem with the reporting by Anthony Barnett.  The reasons for my concern fall into 3 parts.

First, no attempt was made to explain the difference between tax avoidance and tax evasion.  The simple description of efforts to mitigate tax liability was, without that explanation, a polemic whose intent was clear - to ascribe miserable and dishonest intent to those whose actions were criticised.  That is not dispassionate journalism, it is cant.

Second, the people interviewed were mostly members of a left-wing persuasion - Richard Murphy, who is an advisor to the TUC and avowed Socialisit campigner, was interviewed without balance and without any effort made to explain who he was and who he advised and represented.  The so-called 'Tax Justice Network' were also interviewed - and again, there was no description of their motives and motivation.  The reality is that they are an organisation whose principle aim is to effectively ban tax mitigation and they treat tax mitigation as if it were both immoral and illegal - deliberately confusing the legal with the illegal.

Third, no explanation was made as to the tax consequences arising from the criticised decisions.  So, for example, if I put money into trust for my children, the tax consequences of doing so, in terms of CGT paid now, was completely missing from the picture painted by Mr Barnett.  The painting of one side - the avoidance in future - without explaining the cost now - for example, CGT - is, in my view, startling; and essentially paints a picture of the advantages without consideration of the costs.

Finally, I would add one point.  On entering ministerial office, ministers are required to put their assets out of their control; and no credit was given to Mr Hammond, for example, for doing this - even if a brief explanation of this was given in the course of Mr Barnett's polemic!