Why does Britain want to let the rich pay no tax?

by Roland Hulme

 

Cameron and Clegg are in the right by capping tax-free charitable donations

How the super-rich are manipulating the super-dumb British voters.

Out of all the European countries, Britain seems to be one of the only one successfully clawing itself out of the financial quagmire. This is almost entirely due to the combined leadership of the Liberal Democrats and Conservatives; who as a coalition government have made the tough and wildly unpopular decisions that desperately needed to be made.

Yet doing what needed to be done has not sat well with the press, or so-called “progressive” public opinion. 

The latest policy to hit a barrage of criticism is David Cameron’s call for a tax cap on charitable donations.

The system previously in place worked like this: You could write off the donations you made to charity against your tax obligations – so if you earned GBP 100,000 in a year and donated GPB 50,000 to charity in that same year, you would only have to pay tax on half of your income.

The rule was originally set in place to encourage charitable donations – but like all such systems, it quickly got manipulated by canny accountants. The reason Clegg and Cameron want to “cap” the amount that people can donate as a tax write-off is because very rich people were using this system to reduce their effective taxable income to almost nothing.

The rich folk who have taken advantage of this system are up in arms; and have pitched a sublimely convincing line of bullshit to the British public that such a “cap” would reduce charitable donations. As a result, the Guardian-reading committee and the Daily Mail crowd have combined outrage to demand that this cap be lifted.

But the fact is, Clegg and Cameron are right on by insisting on this charitable cap. If they didn’t, it would essentially mean that the richest segments of the community can bypass their tax responsibilities entirely.

Now, the Guardian-reading lot have framed the argument very effectively: It’s true that it currently costs the rich at least as much, if not more, to write off their money to charity as it would to actually pay their tax obligation – but anybody who’s spent any time working in the snake-oil business of registered charity knows that not all “worthy causes” are created equally.

For every incredibly worthy charity – like Brainstrust – there are a bunch of frankly sketchy ones (like the People for the EthicalTreatment of Animals.) Likewise, for every charity that uses its donations for good, there are many that simply serve as a tax-free source of helicopter trips, entertainment expenses and power networking events.

Let’s not pretend there aren’t considerable material benefits to hefty charitable donations; and many reasons why the rich would prefer to channel their money to those rather than the government.

Ultimately, the previous system allowed the super-rich to have the choice of paying the same tax you and I pay, or donating all that money to a cause of their own choice instead. That's what the issue is - and why it needs to be addressed. It’s all very well the Guardian-reading crowd arguing that “it goes to a worthy cause” – but why should the rich have the choice which “worthy cause” it goes to when the rest of us don’t?

The British taxpayer should instead be demanding: If the rich can choose who their tax money goes to, why can’t the rest of us?

And the fact is, the rich shouldn’t have that right. There should be benefits to donating to charity, certainly – but not at the expense of bypassing the same tax responsibilities the rest of the country have. The current system is a shell game; and there are unscrupulous folks manipulating the daftest Brits to let them keep playing it.

If you need proof, just look at the responses of those impacted by the bill: Many rich folks have argued that if Cameron and Clegg insist on a “cap” of charitable donations, they will stop donating – pretty much proving that they've always been in it for the tax write off, not to actually help anybody.

The fact is, the poor and middle class always have to hand over their hard-earned income to the British government.  It’s not fair and it’s not right that the richest Brits can choose to give their money to other people instead.

If you don’t understand this concept – or you don’t support Clegg and Cameron’s proposal – then frankly you’re an idiot.