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Jimmy Carr apologises for tax avoidance but what is Cameron doing?
The comedian has said sorry for his 'terrible error of judgement'. Will the PM do the same? And can we have a proper debate about tax?
Comedian Jimmy Carr has apologised for his 'terrible error of judgement’ in using an offshore tax avoidance scheme.
The Channel 4 standup has said that he was withdrawn from the K2 scheme that, an investigation by The Times revealed, enabled wealthy individuals like Carr to reduce their effective rate of income tax to as low as 1.25%.
This is a sensible move by Carr as the controversy was damaging his reputation. It is a change of tack as he initially said his approach was to pay his tax and not a penny more.
Carr will no doubt hope his admission will see the furore over his financial arrangements subside.
I hope the media spotlight moves off Carr too, not because I want to defend what he has done, but because I think it is time we had a proper debate about tax in this country.
It’s clear that many people object to wealthy individuals and companies using legal tax avoidance schemes. With the country in dire financial straits complying with the letter of the law is arguably not enough. There is a strong held belief that people have a moral duty to pay their fair share of tax.
But what is fair and when does sensible financial planning turn into hard-to-defend tax avoidance and its illegal near-relation tax evasion?
In having this debate I’d like to put the prime minister back in the frame as it was he who turned up the heat on Carr calling the comedian’s tax arrangement ‘morally wrong’.
On one level the PM’s intervention simply followed similar condemnations of tax avoidance by the chancellor George Osborne and the deputy prime minister Nick Clegg.
However, it is shocking that Cameron combined his populist move by criticising a specific individual. Carr is no Fred Goodwin and Cameron demeans his office by picking on one person and demonising him so quickly.
Besides Cameron has shown amazing cheek, if not, downright hypocrisy, in portraying Carr as an enemy of the people.
It wasn’t so long ago that The Guardian revealed how Cameron’s father, a stockbroker, had invested the family fortune in funds based in ‘offshore’ tax havens such as Panama and Geneva. While it was there the money would have grown free of UK tax. It is reported that Cameron inherited £300,000 of the £2.7 million left by his father, Ian, when he died two years ago.
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