Small state is a tax dodgers dream…..

The Guardian this morning has a breathtaking story which continues the series which now maybe thought of the continuing saga of the Conservative Party and the dodgy tax dealings of its allies. It says that the Taxpayers Alliance which campaigns against the ‘misuse of public funds’ has its hands in the public till through a ‘research arm’ which is set-up as a charity and therefore can claim Gift Aid on its donations:

In one example, Midlands businessmen said they channelled funds through the Politics and Economics Research Trust at the request of the Taxpayers’ Alliance after they asked the campaign group to undertake research into policies which stood to damage their business interests.

So, what we have here is a clear and graphic illustration of what lies behind the ‘small state’ agenda. It isn’t the empowerment of individuals to free them from the ‘tyranny of the state’ but it is the enabling of primarily business interests (but also wealthy individuals) to escape the ‘tyranny of taxation’. If the state is ‘rolled-back’ then it will naturally benefit these people as it will be less empowered to detect abuses and actually levy tax.

However, wait tweets Tim Montgomerie, the voters want a smaller state as proved by this poll published on Conservative Home. However, the poll proves nothing of the sort; the 61% support for the government taxing and spending less does not a priori mean they want a smaller state and that is proved by the answer to the following question. In the poll 60% think ‘taxes can be cut without harming public services because they can be run more efficently’ which means support for lower taxes is predicated on the condition that it does not harm public services.

If the reverse were proved to be true (or even suggested by the syntax of the question) then the result would be different. Similarly, if people were asked if they supported tax avoidance by the wealthy and the Taxpayers Alliance one suspects you would get a massive negative result and support for the state in taking action. You can see this in the fact that the tax on bankers bonuses (a state action) was one of the measures in the Pre-Budget Report that got massive support.

Advocates of the state and its potential should learn from their opponents who successfully present the matter in a way that is appealing to peoples sensibilities. We should make our case in a way which also exposes how a small state protects the vested interests of the wealthy and is designed not to empower people but to enable those people to escape their social responsibilities when it comes to tax. If we do that then the ideologues of the small state will be left with much of a leg to stand on…..


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About darrellgoodliffe


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