No Taxation Without Quantification – Let’s go for a Win Win Win situation!

BECOME A TAX REFORM ACTIVATOR If you are persuaded by the arguments on this website, and would like to help spread the word, then contact us on surreyhundreds@gmail.com with you name, address, email and telephone number.

Let’s go for a Win Win Win situation!

* More profits         * More tax revenue          * Lower prices

Tax compliance work is estimated to cost the British economy £15-£20 billion a year (source IEA booklet on Red Tape, 2010);  It is also estimated to be up to 16 times more onerous for small businesses to comply with, compared to large businesses.

Could Mo Farah win if he was carrying 250 kg on his back?

My contention is that this labour is an illegal imposition under the Human Rights Act, Article 4, which I present here:

Article 4 – Prohibition of slavery and forced labour

  1. No one shall be held in slavery or servitude.
  2. No one shall be required to perform forced or compulsory labour.
  3. For the purpose of this article the term “forced or compulsory labour” shall not include:
    1. any work required to be done in the ordinary course of detention imposed according to the provisions of Article 5 of this Convention or during conditional release from such detention;
    2. any service of a military character or, in case of conscientious objectors in countries where they are recognised, service exacted instead of compulsory military service;
    3. any service exacted in case of an emergency or calamity threatening the life or well-being of the community;
    4. any work or service which forms part of normal civic obligations

Her Majesty’s Revenue & Customs’s (HMRC) defence relies on their interpretation of clause 3 (d) of this Act – “normal civic obligations”.

In the first place, this is non-specific – neither taxation nor tax compliance are mentioned, and nor is there any attempt at quantification.  And this is most important:  quantification is at the heart of taxation.  There is a world of difference between the amount of work involved in putting your bins out for collection, or occasional jury service, and the vast amounts of work demanded through tax compliance.

Unfortunately, HMRC’s interpretation of the Human Rights Act stands it completely on its head, giving them the right to demand unlimited amounts of unpaid work from us; and this indeed, seems to be their current attitude; witness the size of the tax code book (20,000 pages and rising), and the latest demands for regular on-line digital tax reporting.

HMRC’s approach not only harms business, especially small businesses, it also harms the country.  With so much time and money spent on compliance work, businesses are handicapped and have less time to make a profit; less profits means there is less to tax, and less revenue for the government.

The country also suffers, since businesses, if they are to survive, have to pass on their compliance costs on to their customers – which results in higher prices.

In order to reduce compliance costs to a minimum, I have simply suggested a flat tax on income, which can easily be calculated, without any reference to what the income is spent on.  Many businesses would prefer to pay a higher rate of tax if it meant that they got their time back and spent less in accountancy costs and legal advice.  If some would prefer to work according to the old system, then by all means, they should be allowed to do so.  But the streamlined system would see an enormous boost in profits, tax revenues and lower prices for all.

I was bankrupted last August and the children’s chess tournament that I had run for 21 years, which had taught up to 1 million kids to play chess, was sold off by the government.  This was because I did not accept the unjustified demands on my time and money due to the punitive burdens of tax compliance.  Up to now, the subject of tax compliance has not been debated seriously by any TV or radio station, nor by any national newspaper; nor has it been examined by any MPs.

This is not surprising.  All debate is short-circuited by HMRC.  If you visit their website there is a complaints procedure and an Adjudicator, but the Adjudicator cannot consider any complaints regarding “tax law or policy”.  This is like a restaurant saying “you can complain about anything, except the food we serve”.

If you ask HMRC who you should approach about tax law and policy, they will say, “go to your MPs, since it is parliament that makes the laws”.  But when you do so, you find MPs will answer none of your questions and refer you straight back to HMRC or the Treasury.  So we have no quantification, no complaints procedure and no possibility to discuss taxation with the people who are meant to be our elected representatives.

Two hundred and fifty years ago when the American colonies stipulated, “No taxation without representation”.  They were complaining about the unreasonable behaviour of the British government at the time.  They got their way and so shall we!

– Donate here to get the issue discussed in the media, and lay the foundations for a prosperous future for Britain, freed of the dead weight of government bureaucracy.

– join the movement to reform the tax system by signing up on “Crowdpac

 

EndTaxsploitation Manifesto

BECOME A TAX REFORM ACTIVATOR If you are persuaded by the arguments on this website, and would like to help spread the word, then contact us on surreyhundreds@gmail.com with you name, address, email and telephone number.

EndTaxsploitation Manifesto

Britain is drowning in regulations, with a result that the economy struggles along in first gear.  The EndTaxsploitation movement aims to reduce these burdens beginning with the tax system.

We believe that if we have more time to run our businesses, then more revenue will be generated, and more money will be provided in taxation for the country.  Everyone will benefit.  We will get our time back, and the government will get its money.

We propose:  only income shall be recorded, not what we spend our money on.  Such demands for information are intrusive.   The income shall be taxed at a standard rate over the exempt amount.

We propose:  that VAT should be abolished, with its cumbersome duty to pay, collect and reclaim, and replaced with a transaction tax.  The threshold at which this tax will be levied will be an income of £500,000 p.a.   This will encourage more businesses to grow to a substantial size, whereas at present few start-ups survive their early years.

THE LEGAL POSITION:  Taxation is a normal part of living in society, as the government needs revenue to run its operations.  What is unacceptable is the hidden costs as a result of compliance.  Currently it is estimated that for every £1 the government spends on administrative costs related to taxation, the taxpayer spends £4 in compliance, on top of the tax they pay.

The Human Rights Act, Article 4 forbids slavery, servitude and forced labour.  The Act exempts “any work which forms part of normal civic obligations”.  HMRC tries to argue that this includes tax compliance, but if this were to be accepted, it would give the government the right to demand unlimited amounts of work from us in the name of compliance, and would be completely opposed to the purpose of the Act.  As this is unacceptable, HMRC tries to make sure that any discussion of quantification of the work involved is suppressed or tries to down-play and trivialise the amount of work involved.  Every small businessman knows that these costs are considerable and we will campaign to bring the following to the attention of the government:

NO TAXATION WITHOUT QUANTIFICATION!

End Taxsploitation! (05.10.2016)

BECOME A TAX REFORM ACTIVATOR If you are persuaded by the arguments on this website, and would like to help spread the word, then contact us on surreyhundreds@gmail.com with you name, address, email and telephone number.
The Dismantling of Bureaucracy

My own experiences with HMRC began in 2007 when they decided that because my turnover for the UK Chess Challenge was high (around £250K p.a.) I should enrol for VAT.  I did not fancy all the extra record keeping and I was particularly incensed by the VAT rule which makes you pay tax and then claim it back – an unacceptable invasion of my time – and furthermore, unjust and, from a business point of view, counter-productive, as it dumps the full taxation cost in a large indigestible lump on the final buyer.

I pointed all this out to HMRC and also brought up the Human Rights Act (see previous essay “Prisoners of the mind”), asking them to improve.

Their essential reply was

  1. We can’t improve
  2. We don’t need to improve
  3. We don’t accept any advice from members of the public.

Now I don’t find this acceptable.  They are doing a job, (collecting money in order to run the country) and I expect to be consulted and respected, just as in any other transaction or business.  But, of course, as Lord Acton said, “Power corrupts”.  They have got so used to being close to the levers of power, that they have forgotten their job description: civil servants.

Now, they didn’t quite put it like that, but here is a sample of their actual replies:

(a)  “Officers, as public servants, are not empowered to discuss the setting in place of taxation and as a Public Servant myself I cannot enter into discussion with you. If you wish to take issue with VAT in general you should do so with your Member of Parliament.”

(b) “Incompatibility between the VAT legislation and the HRA would have to be made through the Courts and ultimately through Parliament.”

(c)  “Should you wish to raise points about the efficiency of effectiveness as it applies to you, then the correct forum for that would appear to be, either your Member of Parliament or the Government Minister responsible.  I am sure that any constructive analysis of the department will be welcome by those in a position to consider it.”

I then made the obvious comment that MPs were essentially amateurs who had 100 different matters to deal with; granted they made the laws, but they would benefit from advice from the experts (i.e. tax officers) who all should be thinking and discussing their work, dealing with the public in an interactive way, and trying their very best to harmonise with the populace and improve the running costs of businesses, particularly by making the costs of taxation as low as possible.

After some years of discussion with HMRC, including some HMRC court hearings (of which more later) I took up their suggestion and wrote to my MP, Ed Davey, who communicated with George Osborne, then Chancellor of the Exchequer.

Here is the reply we received:

After that, silence.  About six months later, HMRC resumed the attack demanding that I pay VAT and register.  I wrote to a Mr Eales of HMRC, enclosing this letter from George Osborne where he had promised a “substantive response”.  Mr Eales declared, “We can’t continue until this is resolved, we will contact Mr Osborne from our end for a reply.”

Then silence again.  Mr Eales disappeared and HMRC denied that he had said any of the things he had said.

Silence again for 6 months when HMRC return again.  I pointed out that I was still awaiting the “Substantive response” from George Osborne.  HMRC replied with breath-taking effrontery, “I am sorry if Mr Osborne’s letter dated 17th January, 2015, led you to believe that he would be replying personally.  That is not the case as replies are sent by a Director of HM Revenue and Customs, in this case, Nick Lodge.”

And later:

“This response was provided in the letter dated 21st May, 2015 from Nick Lodge, Director General of HMRC and no further reply is required.”

So that is it.  HMRC now have a foolproof way of ensuring that no improvements are made or discussions are held.  They peddle the lie that they don’t make the laws, but only apply them and suggest that you contact your MP.  When you do so, they step in the way and make sure that the answer is given by themselves.

The HMRC Courts

Around about 2013 my case went to the Tribunal stage.  HMRC decided that my case had “no chance of success”, and therefore applied for a pre-tribunal tribunal to have the case struck off.  HMRC invoked the Human Rights Act, Article 4:

Prohibition of slavery and forced labour

  1. No one shall be held in slavery or servitude.
  2. No one shall be required to perform forced or compulsory labour.
  3. For the purpose of this article the term “forced or compulsory labour” shall not include:
  4. any work required to be done in the ordinary course of detention imposed according to the provisions of Article 5 of this Convention or during conditional release from such detention;
  5. any service of a military character or, in case of conscientious objectors in countries where they are recognised, service exacted instead of compulsory military service;
  6. any service exacted in case of an emergency or calamity threatening the life or well-being of the community;
  7. any work or service which forms part of normal civic obligations.

Their claim was that tax and tax compliance work, was part of “normal civic obligations”, and thus a legitimate demand.

I could scarcely believe that HMRC could hang their vast exploitative industry upon one single vague phrase, “normal civic obligations”.  It reminded me of the “Rumble in the Jungle” between Mohammad Ali and George Forman, when Mohammad said to George, around about round 4, “George, is that all you got?”

At any rate the trial began under the auspices of the exotically named, Judge Nicholas Aleksander, who startled me at the beginning of the trial with a very peculiar definition of slavery; it was a foregone conclusion that HMRC would win, but Judge Aleksander did provide a short summary afterwards where he cited the case of Reilly v Secretary of State for Work and Pensions to bolster his position.

Here is a brief outline of the case:-
R (Reilly) v Secretary of State for Work and Pensions

From Wikipedia, the free encyclopedia

Caitlin Reilly and Jamieson Wilson v Secretary of State for Work and Pensions [2012] EWHC 2292 (Admin) was a 2012 legal case heard by the Administrative Division of the High Court in which Caitlin Reilly, an unemployed geology graduate, and an unemployed driver, Jamieson Wilson, challenged the Department for Work and Pensions “workfare” policy whereby the unemployed can be “forced” to work for private companies for their benefit payments. Under the workfare scheme, individuals have the right to opt out, but face having their benefits removed—something that makes participation in the scheme necessary for those who would be unable to support themselves without their benefit payments. The outcome of the case affects over 3,000 claimants and entails around £130m unpaid benefits.[1]

Looking at the case, I pointed out the obvious flaw – Reilly was receiving Job seekers’ allowance and thus, something in exchange for her work and so our situations could not be compared.  I was then granted an Appeal, but not a proper appeal, it was to be an “oral hearing”.  Despite this, the Judge, Greg Sinfield, did also provide a written summary of our meeting.  I had brought up the matter of the Reilly case and Judge Aleksander’s  error to which Sinfield replied as follows:

“In relation to the first point, Mr Basman has misunderstood the FTT’s reference to the Reilly case.  The FTT was not saying that Mr Basman was in the same position as Ms Reilly.  The FTT referred to the case because it contained useful guidance on the meaning of “forced or compulsory labour” in Article 4 of the ECHR.  That guidance did not depend on the fact that Mr Reilly was in receipt of Jobseekers allowance bur was general guidance on the meaning of the phrase “forced or compulsory labour”.  Applying the meaning given by the Supreme Court, the FTT concluded that a requirement to comply with the VAT legislation was not “forced or compulsory labour”, as properly understood, for the purposes of Article 4 of the ECHR.  I cannot see any error of law in that conclusion.”

The more that you read this, the more peculiar it appears.  Obviously, to justify their existence and charge astronomical fees for their services, the Judges and Lawyers have to invent their own language and meanings, comprehensible only to themselves, called “legalese”.  My point was deemed irrelevant because the Reilly case was only meant as “general guidance on the meaning of the phrase, compulsory labour.”

So a specific case is not meant to give specific guidance, but only general guidance and we are not told what that general guidance specifically is.    Judge Sinfield then charges on, and concludes that the VAT legislation was not “forced or compulsory labour” as properly understood.

Note the telling phrase, “as properly understood”.  These things can only be properly understood by Her Majesty’s lawyers and judges and are beyond the grasp of mere mortals.

But perhaps Judges should also understand that the Law is designed to serve everyone, and if it is incomprehensible that is the fault of Lawyers and Judges, not of the general populace.

At a later stage Judge Sinfield tackled the question of the large amount of work involved in tax compliance.  During the proceedings, I asked the Judge, “Am I expected to work 24 hours a day for you?”  Judge Sinfield replied, “Of course not”.  I went to the Hearing with my friend John Adams and afterwards we agreed that we had missed an opportunity here.  Judge Sinfield had clearly stated a figure – that 24 hours a day spent on tax compliance is an unacceptable workload.  We should then have asked the judge, “What would you consider an acceptable amount of work?”  Our failure to nail the judge down to a more precise figure let him off the hook, and he lived to fight another day.  In fact, that day has not yet  arrived as I had run out of Appeals.

Nonetheless, the exchanges had been useful, and it gradually dawned on me, that besides trying to avoid any discussion of my case at all, HMRC was also desperate to avoid any discussion of quantification.  Surprisingly, since they are so keen to try and quantify “the right amount of tax due”, one would have thought that they would be keen to put a number to the correct amount of forced, compulsory and unpaid labour that we are expected to deliver.

The final, bankruptcy, part of my court experiences did nothing to dispel the impression of these courts as functioning as the judicial arm of HMRC.  Anxious to get through as many cases as possible, (HMRC was by now bankrupting people on an industrial scale), the judge, (Deputy Registrar Kyriakides in the High Court of Justice in Bankruptcy) declared amazingly that, “It would take too long to change the law, so I am bankrupting you immediately”.  (This is 100% true; we saw earlier HMRC are so easily able to gag and impede MPs from carrying out their proper jobs as legislators, that any change occurring wouldn’t happen until the year 3000, and then not due to pressure from the electorate, but when HMRC decided what was best for us.)

As a result I was bankrupted, and my tournament which had taught over half a million children to play chess was crippled, possibly permanently.

The Decision

On 10th   December, 2016 I received a letter from No. 10 Downing Street.

It was regarding a long-term dispute that I have had with HMRC (Her Majesty’s Revenue and Customs), in which they had repeatedly stated, in letters and telephone conversations, that, “We do not make the laws, we only apply them.   If you wish to change them, consult your MP.”   I was complaining that the work and expense to the taxpayer resulting from tax compliance rules was exploitative and illegal under the Human Rights Act, Article 4, and furthermore, it was illogical to charge VAT on entry fees to children’s chess tournaments.

When I wrote to MPs, notably the Chancellor of the Exchequer George Osborne in 2014, HMRC stepped in and replied in his stead.   I complained about this to HMRC and reported it recently to the Prime Minister, Theresa May, and the answ er  I  received  on  10 th    December  was,  “ The  department  wi ll  have examined all aspects of your correspondence very carefully and I regret that we are unable to add anything further to the department ’s replies.”

Well, I’ve got news for you, Mrs May, you are responsible for the honesty of the people and the departments working under you.   The buck stops with you. HMRC cannot claim on the one hand, that they have no part in law- making, and then on the other, prevent the law-makers (MP’s) from discussing,  let  alone  passing,  those  laws.

A decision has been made in the court of analysis and reason, that HMRC directly, the government, MPs and ultimately, Theresa May, are guilty of lying and corruption.

This verdict has yet to be delivered in any court of this land. The question arises, which court has the greater authority?

HMRC have been doing everything in its power to prevent the questions that I have raised being debated in the courts, the media and among the general public.   However, it is now time for MPs, the newspapers, the BBC and the rest of the media, as well as the British public (when they are finally told the facts), to declare where they stand.

Collateral damage – children’s chess event was crippled by HMRC activity. Northern Gigafinal 2016, Saturday

PRISONERS OF THE MIND

Let’s go straight in.  Here is Article 4 of the Human Rights Act:

Human Rights Act – Article 4 – Prohibition of slavery and forced labour

  1. No one shall be held in slavery or servitude.
  2. No one shall be required to perform forced or compulsory labour.
  3. For the purpose of this article the term “forced or compulsory labour” shall not include:
  4. any work required to be done in the ordinary course of detention imposed according to the provisions of Article 5 of this Convention or during conditional release from such detention;
  5. any service of a military character or, in case of conscientious objectors in countries where they are recognised, service exacted instead of compulsory military service;
  6. any service exacted in case of an emergency or calamity threatening the life or well-being of the community;
  7. any work or service which forms part of normal civic obligations.

I suggest that you read it twice, so we are clear what we are talking about.

It is pretty clear – forced labour is illegal except for the armed forces, prison or an emergency.  You may work for yourself and your family, you might work for other people or organisations (in which case you would expect to be paid), or you could work for the community; hence the 4th provision, “normal civic obligations”.

This is not defined, but the “Liberty” website cites “Jury Service” as fitting within this category.

The subject of this essay is the Tax System which is made up of two parts – the actual tax paid, and the extra work involved in tax compliance.  The question we want to answer is:  is work involved in regard to tax compliance, illegal, being forced, compulsory and unpaid?

[Rider Alert: this article does not question the need to pay tax; if you have a government, it will need to be funded; the argument is with tax compliance work].

There is no doubt that the work involved in tax compliance is onerous; to the need of recording and book-keeping, we can add the complexities of the 20,000 page tax code book; the fact that there are at least two – and sometimes more – tax systems, such as income tax and VAT; the strange ritual where you pay VAT and then claim it back; the tax officers, the accountants, tax advisers, lawyers, all who have to be paid …  everyone complains and wrings their hands about the burden of regulation, but that is all they do – wring their hands; meanwhile the tax machine chunters on and on.

Here is a little questionnaire that you could fill in (get your pencils out!) so you can decide where you stand on this matter:-

(Circle your answer)

Question 1: Is there work involved in tax compliance?                                                    Yes/No

Q2: Is this work compulsory?                                                                                      Yes/No

Q3: Is this work unpaid?                                                                                                Yes/No

Q4: is there a considerable amount of work involved?                                    Yes/No

Q5: Is tax, or the work involved in tax compliance, mentioned anywhere in the Human Rights Act?                                                                                                                                           Yes/No

Q6: Is there any comparison between the amount of work involved in tax compliance and that of, say, Jury Service, which the organisation “Liberty” mentions as an example of “normal civic obligations” on its own website?                                                                          Yes/No

Q7:  Would you regard paying tax as part of “normal civic obligations”?   Yes/No

Q8: Would you regard the work involved in tax compliance a part of “normal civic obligations”?                                                                                                                                                  Yes/No

What did you decide?

It is significant in regard to question 5, that tax and tax compliance is mentioned nowhere in the Human Rights Act.  In regards to question 6 the amounts of work involved in Jury service and tax compliance are light-years apart.  It is also significant that HMRC has never costed this and tries to avoid all mention of quantification in its deliberations.

By now it should be obvious that tax compliance work (rather than taxation itself) breaks the Human Rights Act.  The HMRC position, that it is part of “normal civic obligations”, does not pass muster, due to the enormous amounts of work involved.

Nor can the HMRC position that “we need to work exactly how much you have to pay” stand up to scrutiny because if you have to spend inordinate amounts of time deciding what is the “right” amount, this involves work, and this work must be paid for; and you can be pretty sure that it is the tax payer who will pay for it and not the tax office.

Another justification wheeled out by HMRC is, “you need to keep accounts anyway”.  Maybe, but tax accounts are not the same as working accounts.  I ran the UK Chess Challenge for 21 years with minimal accounting and it was fully viable and no one got swindled.  People have remarked recently that there is a clear divide between the ruling classes and the ruled and they say that this divide led to Brexit.  There is no clearer example of “the two nations” than the matter of the tax system and the unresponsive nature of the tax office.

It’s not even as if the work that the tax office insists that we do is USEFUL.  I once likened tax compliance to going into a shop and buying a car or arranging your funeral, only to find that the car maker dumped the car outside your house in a million pieces and left you to assemble it; or that the funeral director handed you a shovel and told you to dig your own grave.  But tax compliance work is even worse than this;  at least after you had assembled the car or dug your grave, you would have had something tangible to jump into; but after completing tax compliance work you have nothing to show but the vague anxiety that you may have broken some rule that you don’t even understand.

What is more, if you look at this matter objectively, tax compliance work is definitely HARMFUL.  Time and money spent by a businessman on tax affairs could be spent on running a business, could be spent in making profits which would then result in a higher tax revenue.  There is no doubt that the tax office has set up a lose-lose situation (except for creating more paid jobs for itself); but could we expect anything else considering that HMRC is situated at the seat of power and that this non-democratic, non-elected body makes sure that none of its employees does any thinking except at the lowest level.

What I propose is two vital parameters for collecting tax which would produce a much more optimistic scenario.

  1. The principle of raising the most possible tax with the least possible work by the tax payer. This needs to be monitored by carefully listening to the input from small businesses and the self-employed.  Currently the welfare and opinions of the general public are given little attention.
  2. The principle of necessary regulation. Just as you might build a house and have to comply with regulations to ensure that the roof is not likely to collapse, so this rule should apply to regulations.  If that rule were applied to taxation, one of the first things to go would be VAT, which is a time wasting  form of tax collection where tax is paid and then claimed back.
  3. HMRC should communicate with and work with businesses instead of against them. HMRC does not understand how hard it is to run a business and how hard it is to make a profit.  Currently HMRC is more worried about businesses behaving fraudulently, and sets up a total surveillance society in finance.

Obvious examples of improvements that could be made to help businesses be more profitable would be to raise the threshold at which VAT regulations kick in from £83,000 to £500,000; to have the possibility of a flat rate based on turnover.

We could also extend this approach to look at employment regulations.  Why are they so one-sided?  Why is it that as soon as a business employs a person, this employee gains several rights whereas all the employer gets are obligations plus an incredible amount of regulation and form filling?  Small wonder that so many people are self-employed and that small businesses stay small, or disappear from the scene altogether.

When I put all these ideas to the nation following my bankruptcy at the hands of HMRC (of which more later), I was met by a wall of condemnation.  An article did appear in the Telegraph on 29th August, 2016, (and all credit to this newspaper for doing this).  A very supportive letter followed 4 days later in the same newspaper.  However, that article did not even cover the points in this essay and subsequently I was blanked out by all the leading newspapers and the BBC.  The Times and the Today program of the BBC held extensive interviews with me, but subsequently pulled them.  Not a single MP nor Think Tank has accepted my analysis and the general attitude of the chess community has been mute or openly hostile.

Why this reaction?  I believe it is because the wealthier and more educated classes either benefit from or or are not significantly harmed by the current situation.  Many people are cowed by HMRC and frequently say that HMRC is a “law unto itself” without even questioning whether this should be an acceptable state of affairs.  Naturally HMRC, being in charge of the purse strings, has enormous powers, which seep into the regular courts; even the largest firms are wary of the approaches of the tax department, and tool themselves up with the appropriate numbers of lawyers and accountants with which to defend themselves.  There is thus an uneasy stand-off between taxmen, accountants and lawyers; on the one hand they feed on each other, on the other hand there is extreme wariness.

There are a shrinking number of PAYE workers who are not so affected directly by tax compliance; there are also millions of people on benefits who are partly grateful for the support they get and partly resentful of their dependent status.  But the largest and growing demographic is of small businesses and the self-employed and these have occurred as a result of the diminishing number of paid regular jobs available partly due to the crushing weight of regulations, from the tax office and other departments.  However, although the self-employed and small businesses  may enjoy the relative freedom of this work, it is also very difficult for them to grow their businesses under the current regime.

It is to those people to whom I direct this essay, and also to the enlightened members of the ruling classes and the establishment who see that there is a need for improvement.
————————————————————————————-
lft_rtgeorgeosborne-mikebasman-magnuscarlsen-kirsan_ilyumzhinov

WHY BRITAIN WON’T HAVE ITS OWN WORLD CHESS CHAMPION

Mike Basman (left) receives an award for services to chess from the President of the International Chess Federation (FIDE), Kirsan Ilyumzhinov, in front of World Chess Champion Magnus Carlsen and Chancellor George Osborne.

The event was hosted in 2013 at Number 11 Downing Street by George Osborne.

Even though purportedly the second most powerful man in the country at the time, George Osborne, a keen chess fan himself, was unable to prevent his own department from crippling the UK Chess Challenge, the tournament which provided chess education to 50,000 children in the country every year.

Press Release:  1st December, 2016

Mike Basman
Mike Basman

The thesis is best explained in a recent letter I wrote to Dominic Raab, MP, author of the brilliant 2009 work, “The Assault on Liberty”.  We are awaiting his reply…

Mr Dominic Raab, MP
Houses of Parliament
Westminster, SW1A 0AA

Saturday, 12 November 2016

Dear Mr Raab,

Thank you for your letter.  I am already in contact with my MP, James Berry.

However, I question the suggestion that you can only communicate with your own constituents.  You are, in my opinion, an important author of the book, “The Assault on Liberty”, and also in Parliament you will often have to deal with matters that affect the country as a whole.  My issue is a general one, although of course, it does interact with my individual situation.

You are uniquely placed to deal with this matter, especially as, in the meeting of 27th October, you stated that you were preparing a report on the tax system, so I imagine you will welcome input from a member of the public.   I hope, therefore, that you will be able to consider the case that I make.

Let us assume that taxation is necessary in order to fund the government. So far so good.  But the tax paid is only the tip of the ice-berg – below this is a welter of rules and regulations in a multi-billion pound industry.   All the work that the public do in regard to tax compliance is unpaid, so this could be massive exploitation and also outlawed by the Human Rights Act, Article 4.

I present it to you here.
It is very short.

Human Rights Act – Article 4 – Prohibition of slavery and forced labour

    1. No one shall be held in slavery or servitude.
    2. No one shall be required to perform forced or compulsory labour.
    3. For the purpose of this article the term “forced or compulsory labour” shall not include:
      1. any work required to be done in the ordinary course of detention imposed according to the provisions of Article 5 of this Convention or during conditional release from such detention;
      2. any service of a military character or, in case of conscientious objectors in countries where they are recognised, service exacted instead of compulsory military service;
      3. any service exacted in case of an emergency or calamity threatening the life or well-being of the community;
      4. any work or service which forms part of normal civic obligations.

Note the three exceptions – prison, war, emergencies – and then the problematical part, note (d) “normal civic obligations”.

I have prepared a brief questionnaire regarding the Human Rights Act in relation to tax compliance.  (Circle the answer you agree with)

Question 1: Is there work involved in tax compliance?                                                    Yes/No

Q2: Is this work compulsory?                                                                                      Yes/No

Q3: Is this work unpaid?                                                                                                Yes/No

Q4: is there a considerable amount of work involved?                                    Yes/No

Q5: Is tax, or the work involved in tax compliance, mentioned anywhere in the Human Rights Act?    Yes/No

Q6: Is there any comparison between the amount of work involved in tax compliance and that of, say, Jury Service, which organisation “Liberty” mentions as an example of “normal civic obligations” on its own website?   Yes/No

Q7:  Would you regard paying tax as part of “normal civic obligations”?                   Yes/No

Q8: Would you regard the work involved in tax compliance a part of “normal civic obligations”?  Yes/No

My commentary is:

In regard to question 4, I would remind you that, with VAT, not only are there invoices to be issued, tax to be collected; tax also to be reclaimed; detailed records to be kept going back up to 10 years; on-line quarterly reporting to be done; book-keepers, accountants, and tax advisers to be hired; a 20,000 page book of rules to be read and understood…

It is significant in regard to question 5, that tax and tax compliance is mentioned nowhere in the Human Rights Act.  In regards to question 6 the amounts of work involved in Jury service and tax compliance are light-years apart.  It is also significant that HMRC has never costed this and tried to avoid all mention of quantification in its deliberations.

With regard to question 7, a good case can be made for paying tax as part of a transaction between the citizen and the government.  The government is delivering a service in running the country and the public are paying for it.  Once you start to use phrases like “civic obligations” you are beginning to use language more suitable to monarchical or feudal eras of government.

Finally, if you answer yes to question 8, that would imply that you considered forced and unpaid labour is a normal part of everyday life.  That would mean that the Human Rights Act would be having the completely opposite effect to its original intention.  The question clearly hinges on the amount of this labour which is demanded, and this matter has never been investigated or properly quantified by HMRC itself.

I have added on a separate page my discussion on the concept of “normal”.

I have also added another section which outlines my ideas of how the tax system could be improved.

In my experience with dealing with MPs, I find they are unwilling to analyse a situation and prefer to hand problems back to a department of the Civil Service.  As we know, and are frequently told, the Civil Service cannot make the laws; therefore they can only state what the current situation is.

I therefore, welcome your analysis,

With best wishes,

 

Mike Basman

 

Enclosures:

NORMAL COURSE OF BUSINESS

This is not the “normal course of business”.

The “normal course of business” is a trade between two or more participants.  Taxation and tax compliance is an auxiliary factor introduced by governments to raise revenue.

Slavery was a normal part of society in the past; burning to death was a normal part of justice; they were abandoned because they were exploitative or disproportionately cruel.  A case can be made for taxation; to run a government money is needed.  The argument then revolves around, how much tax should be paid? and who should pay it?

The question also involves: is the power of coercion that the government has, being fairly used?  Is it being exploited by individuals who have access to the levers of power?  Are the people being served by their government, or being exploited?

Tax compliance work is to tax like derivatives and hedge funds are to finance; they are like the “dark matter” of the universe.  They are like the 90% of the iceberg that is below water.  They are there, but hard to grasp.  There is no doubt that the work demanded through tax compliance is huge; it has  arisen and been imposed by stealth and deception.  It is like the recent growth of the EU, which began as a trade agreement, and morphed into a super-state, step by step.  There is now a discussion as to whether you can have free trade without the free movement of people.  It might be argued that free movement of people is a “normal” part of trade; it is not;  it is a bargaining chip being used by Brussels in its drive for greater power or greater integration.  It is not intrinsic to trade, any more than a maggot is an intrinsic part of an apple.  Similarly, tax compliance work must be put under the microscope and abandoned after a quantitative analysis has been made.  Who benefits? and who suffers?   The “establishment” benefits; rich people do not suffer so much; the government, bureaucrats, lawyers, accountants, tax men, tax advisers also benefit.  Who suffers?  Businesses, in particular small businesses and the self-employed, but also the whole of society, and especially the poor, who have to pay more for everything they buy due to higher prices.  For either this work is done for nothing, and thus is forced labour, or the cost is passed on to society in the form of higher prices.  So this issue affects everyone.

 

Necessary improvements to HMRC

      1. The principle of raising the most possible tax with the least possible work by the tax payer.  This needs to be monitored by carefully listening to the input from small businesses and the self-employed.  Currently the welfare and opinions of the general public are given little attention.
      2. The principle of necessary regulation. Just as you might build a house and have to comply with regulations to ensure that the roof is not likely to collapse, so this rule should apply to regulations.  If that rule were applied to taxation, one of the first things to go would be VAT, which is an incomprehensible form of tax collection where tax is paid and then claimed back.
      3. HMRC should communicate with and work with businesses instead of against them.  HMRC does not understand how hard it is to run a business and how hard it is to make a profit.  Currently HMRC is more worried about businesses behaving fraudulently, and sets up a total surveillance society in finance.

In my own dealings with HMRC, which lead to my bankruptcy after 21 years of running the UK Chess Challenge, unfortunately the tournament became so successful that it easily passed the pitifully low threshold of £83,000 turn-over for the registration of VAT.  Seeing that my administrative workload was about to increase enormously, I expressed the opinion that I was not prepared to work with them if they were so incompetent, inefficient and exploitative, unless, of course, they were prepared to make improvements.  HMRC replied that (a) they could not improve (b) they did not need to improve and (c) they were certainly not prepared to take any advice from a member of the public.

This yawning gap in understanding shows the problem which we have with government.  It is set up in order to regulate society and ensure that people work together in a reasonably fair way.  But the government itself can form a ruling group, impervious to the outside world, and able to manipulate the levers of power to its own advantage.  This situation has caused a division between the populace and the ruling elite which is one of the fundamental causes of the Brexit and Trump phenomena.