Famous UK comedian Jimmy Carr has been embroiled in a recent media scandal.
In June 2012, Carr’s involvement in an alleged K2 tax avoidance scheme came to light after an investigation by The Times newspaper. The scheme is understood to involve UK earners “quitting” their job and signing new employment contracts with offshore shell companies based in the tax haven of Jersey. British Prime Minister David Cameron commented on the issue: “People work hard, they pay their taxes, they save up to go to one of his shows. They buy the tickets. He is taking the money from those tickets and he, as far as I can see, is putting all of that into some very dodgy tax avoiding schemes.” ~ Wikipedia
Carr apologised on his twitter account @jimmycarr. He tweeted, “I now realise I’ve made a terrible error of judgement.” Adding, “I’m no longer involved in it and will in future conduct my financial affairs much more responsibly. Apologies to everyone…”
The practices of Carr in the UK have become increasingly commonplace. Citizens wishing to legally minimize taxes have been able to defer their income overseas through a legal loophole. This is also something not available to the public but only the financial elite. Simply opening a business bank account in Jersey with the proper legal framework can cost upwards of 7,000 pounds. This does not include the financial advising and the preparation of legal documents to restructure existing contracts which can far exceed the company formation and account acquisition costs.
I met with a financial advisor and he said to me ‘Do you want to pay less tax? It’s totally legal.’ I said ‘Yes.’
It can certainly be seen that Jimmy Carr made an enormous mistake. That he betrayed the country’s trust and acted in a unethical and unfair manner. This, after all, is the picture the major media outlets in the UK have been painting. However, Carr’s actions can be seen in a different light. We all know that there are inequities in the world. If Carr had used his wealth to provide his children with a better education then publicly available, few would take up arms.
This history of tax avoidance in the UK in an interesting one to say the least. One of the more humourous stories came when in 1696 under King William III, a window tax
was placed. It was largely felt that allowing the government to peer into the private financial records of citizens was a huge violation of privacy. However, with sales tax, taxes are not levied unequally. The government wanted to find a way to tax richer citizens more. Instead of looking at personal accounts of citizens, they figured more wealthy individuals would own larger properties and with it, larger windows.
The law was a complete bust. Property owners ended up blocking their windows and the sentiment was that it was a tax on light and air. It lasted for 156 years and was repealed shortly after the introduction of the personal income tax which was introduced in 1842. The personal income tax remained wildly controversial well into the 20th Century.
In the US, during his run for presidency, Congressman Ron Paul repeatedly criticized the personal income tax. In his view, abolishing the personal income tax will solve more problems than it creates. The utilisation of a large workforce is in an unproductive capacity attempting to enforce an untenable system. In his view, agencies like the IRS are paid to do an unnecessary task which wealthy American individuals can loophole around, just like Jimmy Carr did in the UK. A personal income tax which is supposed to benefit the poor and tax the rich can have the opposite effect. Wealthy citizens of the US or UK will take full advantage of their capacity to legally avoid taxes while the poor cannot afford such measures. This will become a reality if it hasn’t already.
According to Carr , “I met with a financial advisor and he said to me ‘Do you want to pay less tax? It’s totally legal.’ I said ‘Yes.’” Carr also noted, “…I’ve been advised the K2 Tax scheme is entirely legal, and has been fully disclosed to HMRC (Her Majesty’s Revenue and Customs)…”
If so many UK citizens are taking advantage of the ability to avoid taxes, why then is Jimmy Carr singled out? One theory could be because of his attitude towards this issue in regards to the banks. Wikipedia states, “Earlier in 2012 Carr had lampooned people who avoid tax during the second series of Channel 4′s satirical news programme 10 O’Clock Live. A sketch from the show, in which he poked fun at the 1 per cent tax rate of Barclays Bank has now ‘come back to haunt him’.”
In the following youtube clip we can see also see another funny bit critical towards the banks.
It is up to the reader which side of the debacle they decide to choose. The relation to bitcoin is that bitcoin is non jurisdictional and free. Banking is a highly regulated industry. This leads to pseudo monopolies, a lack of consumer choice and incredible expenses for things like setting up an overseas account. Instead needing potentially tens of thousands of pounds to retain a portion of your income (making it only logical for those with very high incomes to take advantage) with bitcoin it is entirely free to practice the exact same tax avoidance scheme. By paying employees in bitcoin, one reduces the overhead and evens out the playing field. It is this writer’s feeling that Jimmy Carr was simply taking advantage of something that few citizens can. If Bitcoin levels this playing field, we can all take advantage.
It is simply not true to claim that legal tax avoidance is only available to the rich elite. You are free to leave the UK at any time and relocate to a country where there is no income tax. The British are not slaves. Yet.
I hope that the line “It can certainly be seen that Jimmy Carr made an enormous mistake. That he betrayed the country’s trust and acted in a unethical and unfair manner.” is a clumsy attempt at sarcasm. Jimmy Carr betrayed no one, and he acted entirely lawfully.
On the one hand, the supporters of violent taxation want ‘fairness’ and the rule of law, and then simultaneously, they want people to not follow the law if it is to their advantage. I’m afraid that people who think like this are not really thinking at all, but are acting like well trained pavlovian dogs who have been manipulated to reflexively kick out against anyone who acts in their own interests. They are perfectly trained collectivists and anti-individualists.
The inequalities in the world are real. Most of them are caused by the State, not by the accumulation of wealth by individuals. The people who accumulate wealth are in fact responsible for you being able to read this right now, from anywhere in the world, at a cost of zero.
The manufacturer of personal computers creates many millions of times more wealth for others than he does for himself simply by providing a product that is useful and at a good price. This subtle reality, ‘That which is not seen’ is what is always missed by the knee jerk, sour grape numbskulls who want to destroy anyone who has more than ‘their fair share’. The rich make life better for everyone. They are in no way parasitic on society, and are in fact crucial to the general prosperity.
The story of the window tax is an interesting one, but most people fail to understand its true message. The real message is if you tax people, they are willing to block out the sun to stop the thieves. That is how far people are willing to go to keep their money safe. That is the real message of the window tax, and its is only through decades of careful brainwashing that many people fail to see this.
Even in the age of the internet, an article like this fails to mention the Laffer Curve, which proves categorically that when you reduce the rates of taxation (morality of it aside) revenues increase. What is needed to increase revenues, if you believe in the whole idea in the first place, is to reduce the level of taxation across the board, not increase it or ramp up the efficiency of collection. K2 would not exist if the maximum total rate of tax in the UK was 5%. That means, by the way, only one tax of 5%, wether it is collected by VAT or other means. Money from around the world would flood into the UK transforming it utterly and pushing the prosperity of all through the roof. Of course, none of the ignorant swines in the UK want to hear this, because they are only interested in attacking the rich out of petty, childish, imbecile jealousy.
It is absolutely not, “up to the reader” to decide what is right and what is wrong. Stealing is wrong and taxation is theft. These are indisputable facts, not subject to your or anyone else’s threadbare opinion.
Paying people in Bitcoin sounds like a way to avoid taxation, but this is not the case. In the USA, a company tried to avoid breaking the income tax reporting threshold by paying its employees in US legal tender gold coins that are worth thousands of dollars each but which have a nominal face value of one dollar. It went to court. They lost. Anyone who tries this with Bitcoin will end up the same; the State does not play by its own rules, and only the hopelessly naive believe otherwise.
But the underlying message here is more sinister. By conflating Bitcoin with K2 and other types of legal tax avoidance, the subtle message in this article is clear; Bitcoin can be used for ‘dodging tax’, and should be heavily regulated and surveilled so that this can not happen. If Britain tries to regulate Bitcoin, the Bitcoin will flee in the same amount of time it takes to rack up six confirmations. This is called an ‘own goal’, or ‘shooting yourself in the foot’.
Finally, Jimmy Carr now says he is going to pay more, but how much more should he pay? Should this be decided by readers of the Daily Mail, or disgruntled sellers of Socialist Worker in Manchester, or some other uneducated idiot? Just what sort of lawless world do these people really want, where the mob decides how much is stolen from you? Whatever type of world it is, it is not based on morality, ethics or logic. It is a world whose foundation is set in base stupidity, ignorance and violence, and it needs to be confronted and refuted every time it shows its disgusting ugly face.
We are mostly on the same plain here. However you said, “It is simply not true to claim that legal tax avoidance is only available to the rich elite. You are free to leave the UK at any time and relocate to a country where there is no income tax.”
While this is true it would substantially lower most people’s standard of living. It would also generally limit their mobility. For those with lower incomes it is generally not reasonable for them to move countries to pay a lower percentage on taxes.
You also said, “I hope that the line ‘It can certainly be seen that Jimmy Carr made an enormous mistake. That he betrayed the country’s trust and acted in a unethical and unfair manner.’ is a clumsy attempt at sarcasm. Jimmy Carr betrayed no one, and he acted entirely lawfully.”
This is not an attempt at sarcasm. However, please notice that I said, “It can certainly be seen…” I didn’t say that is the way it is. I fully believe did betray no one but if I cannot blame those who buy into the media’s bias here. Not everyone has the sort of free time to explore or the understanding of these issues that the bitcoin community does.
And to address the last point where you said, “It is absolutely not, ‘up to the reader’ to decide what is right and what is wrong.” While I wouldn’t agree that all forms of taxation are theft, I do think that the personal income tax is inherently flawed and wrong. A person’s opinion cannot change that, however readers still do have the right to choose their opinion.
I do hope that someone who disagrees with the slant of the article will chime in.
I dont think we are on the same plane at all, for the simple reason that you believe that the State has the right to steal some money, and that some violent theft is justifiable and moral, whereas my position, the consistent, ethical position, asserts that theft and violence is always wrong no matter what the purpose the stolen loot is put to. All forms of taxation are theft. They are not voluntary contributions. It is money taken by force. If you agree with compulsory taxation, you are for violence and theft, full stop.
It is precisely this sort of incomplete thinking that creates and justifies every destructive tax that the State imposes. “Its OK because its only a small percentage of income”, or “this only impacts the most wealthy, so its acceptable”. This kind of thinking is straight out of the TV/Tabloid weaned and educated electorate’s slave dictionary. Sadly, many people in the UK do not have the capacity to make moral judgements or to put it simply, to tell right from wrong.
Our only hope is that technology makes these erroneous and immoral ideas moot. If Bitcoin can help make it impossible for tax collection to continue, all the people who are not thinking correctly will simply have to go along with things as they are; the State de-fanged. All taxation will become a thing of the past. Society will transition to a completely voluntarist, non-violent model, and life will improve dramatically for everyone, across the board.
This will mean no more war, for a start; it will mean the end of mass murder on an industrial scale. It will mean the end of the police state, a reduction in crime everywhere and prosperity of an unprecedented level since all money would be circulating only for the benefit of people and their needs and not the parasitic State.
Unfortunately you are not grounded in reality here. Government itself has long been thought of by educated people as a “necessary evil”. The benefits of a wide society are inarguable.
If you would heed your own advice, you are free to move to a tax heaven yourself, or to be truly free to middle of a jungle. If you were to try to create a utopia of your own, politics would arise. The idea and benefit of roads, schools hospitals would arise. The world is not so black and white.
Technology has been able to reduce barriers and has eroded the need for hierarchies in society.
If you lived in a prehistoric society, however rich and educated it was, if it did not have a standing army it would fall the day a neighboring force entered. That has certainly continued to be true in the 20th century and I suspect will be true for much of the 21st.
While I appreciate the poetry of idealism, blind idealism does not solve problems. Fanaticism in bitcoin threatened it early on. I have witnessed bitcoin in the last year growing out of this and becoming more and more embraced by the real world. I hope this trend continues. I hope in the future people use bitcoins without any appreciation for their true value in the same way many young internet users don’t grasp the internet’s full beauty.
For example, until recently with Bitcoin, there was no system to easily conduct commerce without the reliance on a hierarchy. Remember even paper cash relies on the enforcement by a hierarchy. A single counterfeiter has the ability to destroy economies.
http://en.wikipedia.org/wiki/Anatasios_Arnaouti
http://en.wikipedia.org/wiki/Wesley_Weber
Even a few million pounds of counterfeit cash represents a significant percent of the cash in population (remember there is far more digital representations of money then cash).
Still, to attempt to run a society based on precious metals would be ludicrously expensive and inefficient. The fraud would also be much higher because, whereas you cannot fake gold, the testing of gold does take some time. I am sure the vast majority of bitcoin users still rely primarily on the banking system and are waiting for bitcoin to reach a critical mass with a network effect.
There are several fallacies in your reply. The first is the Appeal to the People fallacy; “educated people believe this, so it must be true”. The second is the Appeal to Tradition fallacy, “its been like this for ages, so it must be right”.
The third is Tu quoque, a logical fallacy that attempts to discredit the opponent’s position by asserting the opponent’s failure to act consistently in accordance with that position.
Then we get the Straw Men. The ‘Prehistoric Society’, ‘Robinson Crusoe’ attack which anti liberty types reflexively turn to over and over again by rote.
Finally the Ad Hominem. Telling the truth on a comment that is critical of an argument on a blog post is not ‘fanaticism’ or ‘blind idealism’, its is speech. Speech you might not agree with, but speech nonetheless.
The Bitcoin network does not belong to anyone, thankfully. This means that anyone can build services around it and put them out there. Of course, there are some who do not like this freedom, who are frightened of it, and who want only a certain type of Bitcoin business to be allowed to operate. They will lose in the end. The new unregulatable person to person exchanges are just the beginning of this, and I hope they flourish.
My hope for the future is for different to yours. I do not hope for more ignorance, “people use(ing) bitcoins without any appreciation for their true value”. I hope that people become more intelligent and enlightened, not less intelligent and unenlightened. I hope that Bitcoin wakes people up to the true nature of money and how things can be simpler and more free.
I think this is the main difference between our two positions; mine has belief and hope for man’s increase in his freedom, abilities, ethics and knowledge, and the other side, which wants people to be dumbed down, contained and controlled.
My appeals are not meant to be taken as scientific fact. If you wish to actually argue you fail to counter the real points. This is a fallacy called “cherry-picking”.
Your earlier fallacies include many strawman arguments as well.
1. – I hope that the line “It can certainly be seen that Jimmy Carr made an enormous mistake. That he betrayed the country’s trust and acted in a unethical and unfair manner.” is a clumsy attempt at sarcasm. Jimmy Carr betrayed no one, and he acted entirely lawfully.
I never said he did – Strawman
2. The manufacturer of personal computers creates many millions of times more wealth for others than he does for himself simply by providing a product that is useful and at a good price. This subtle reality, ‘That which is not seen’ is what is always missed by the knee jerk, sour grape numbskulls who want to destroy anyone who has more than ‘their fair share’. The rich make life better for everyone. They are in no way parasitic on society, and are in fact crucial to the general prosperity.
The same can be said for the farmer who feeds the manufacturer. Also I see a strawman if you are trying to imply anyone said rich people are parasites.
This actually helps proves my case because you seem to suggest that a society as a whole can produce greater wealth than the sum of it’s parts. You fail to provide a single such incidence (a large computer manufacturer or similar) which operates in a non-governmental area. You also fail to provide an even hypothetical alternative which in this day and age could produce the benefits of our Western society.
3. The story of the window tax is an interesting one, but most people fail to understand its true message. The real message is if you tax people, they are willing to block out the sun to stop the thieves.
I do not think most people fail to see this. It seems to go without saying. Do you have any reason to believe your statement?
4. It is absolutely not, “up to the reader” to decide what is right and what is wrong. Stealing is wrong and taxation is theft. These are indisputable facts, not subject to your or anyone else’s threadbare opinion.
Strawman, I never said it was
5.Paying people in Bitcoin sounds like a way to avoid taxation, but this is not the case. In the USA, a company tried to avoid breaking the income tax reporting threshold by paying its employees in US legal tender gold coins that are worth thousands of dollars each but which have a nominal face value of one dollar. It went to court. They lost. Anyone who tries this with Bitcoin will end up the same; the State does not play by its own rules, and only the hopelessly naive believe otherwise.
Another strawman example. Paying companies overseas is very costly with modern banking costs. Paying the overseas company in bitcoins however is not. I have no idea why you think that has anything to do with gold coins.
6. But the underlying message here is more sinister. By conflating Bitcoin with K2 and other types of legal tax avoidance, the subtle message in this article is clear; Bitcoin can be used for ‘dodging tax’, and should be heavily regulated and surveilled so that this can not happen. If Britain tries to regulate Bitcoin, the Bitcoin will flee in the same amount of time it takes to rack up six confirmations. This is called an ‘own goal’, or ‘shooting yourself in the foot’.
This makes no sense. The bent of the article clearly assumes that the reader knows bitcoin is not able to be regulated in such a way. Personal income taxation is straight up called “untenable”. Bitcoins are shown as a technology which levels the playing field allowing those with smaller incomes to take full advantage of tax loopholes in an… remember “untenable” system.
7. This will mean no more war, for a start; it will mean the end of mass murder on an industrial scale. It will mean the end of the police state, a reduction in crime everywhere and prosperity of an unprecedented level since all money would be circulating only for the benefit of people and their needs and not the parasitic State.
While I believe the state will have less power, these ideas are not well thought out. Technology has allowed us for the first time in history to potentially cause out own extinction. Things like the Russian suitcase nukes were a real scare in the 80s. It is becoming increasingly easy for a single person to kill a great many. Technology is often neutral.
8. Of course, there are some who do not like this freedom, who are frightened of it, and who want only a certain type of Bitcoin business to be allowed to operate. They will lose in the end. The new unregulatable person to person exchanges are just the beginning of this, and I hope they flourish.
Another strawman. If you are implying that this is my opinion you must seriously reread what is written.
9. My hope for the future is for different to yours. I do not hope for more ignorance, “people use(ing) bitcoins without any appreciation for their true value”. I hope that people become more intelligent and enlightened, not less intelligent and unenlightened. I hope that Bitcoin wakes people up to the true nature of money and how things can be simpler and more free.
- Another strawman. My hope isn’t that users are ignorant. There is no way people can appreciate fully the history and benefits of all progress. If bitcoin is adopted and used widely and people end up taking it for granted (much like people do with the internet) it will be a sign of strong change. I do not have an appreciation of all the advancement in physics and engineering yet I greatly benefit from them. I take them for granted.
10. I think this is the main difference between our two positions; mine has belief and hope for man’s increase in his freedom, abilities, ethics and knowledge, and the other side, which wants people to be dumbed down, contained and controlled.
A strawman implying that I do not share this sentiment.
You are a borderline delusional troll I am sorry to say
benjamindees on reddit posted
“And then, to top it off, you have a Prime Minister whose inherited family fortune was made providing financial services in offshore tax havens, actually having the balls to criticize this comedian for utilizing them. Hilarious.”
I’m unsure if this is true or not, if it is it is indeed ludicrous.
Yes it is true.
northblinder on reddit seemed to understand the article
We should remember a couple of things when considering this issue.
The first is that the law is bullshit. The gov’t — or rather the people who run/control the gov’t — do not hesitate to bend or break the law when it suits them or they see a need to. You can bet that when Bitcoin becomes a substantial threat to gov’ts that the gov’t will do whatever it takes to remove that threat.
Also, under our plutocratic/capitalist republics, the very wealthy do what they want and mostly get away with it. They’re dodging taxes now, and they’ll do so in the future.
“The poor live in conditions determined by the law. The rich change the laws by buying new conditions.” — Stan Goff
I hope no one mistakes a quote for being a logical fallacy. Are we not allowed to say quotes anymore? Sometimes other people said things well in the past.
The founding fathers of the US wished to abolish the monarchy. They knew a president with a great amount of authority was necessary for a functioning state. A pure democracy was infeasible.
I believe for the first time a pure democracy is actually attainable. In the future perhaps something even better. An imperfect system is better than no system at all. I hope users are excited at bitcoin and progress. As far as I can imagine, there will always be problems in the world and compromises. A failure to recognise this will not get you anywhere.
The bankers who manipulate money to rob people and the state who enforces the robbery in exchange for a cut has been a part of human history for so long that their status quo became deeply rooted in people minds.
I would like to quote Morpheus – “The Matrix is a system, Neo. That system is our enemy. But when you’re inside, you look around, what do you see? Businessmen, teachers, lawyers, carpenters. The very minds of the people we are trying to save. But until we do, these people are still a part of that system and that makes them our enemy. You have to understand, most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it.”
And I can see why. People do not like change. There is even a Chinese curse “May you live in the time of change”. The imagination of most people just cant cope with the vision of the future once they understand the implications. The inability to fully predict future causes self-inflicted FUD.
Think of is as ‘internal resistance’ and work despite, but with awareness of it.
Btw, the British are more like serfs not slaves.they are free to leave yes, but what does that actually mean. It means they have to leave everything they know: language, family, friends, work network etc… Is that freedom? And to go where? Another tax farm? Do you know how tricky it is to immigrate into another country? It is hard, costly and inconceivable for most of the sheeple. So you are not free. Free to live inthe woods? Ok great…
Being free to leave is a basic form of freedom. Leaving everything they know can be tragic for some, yet others embrace it for various reasons. And besides, in the Internet & air travel age, leaving doesn’t mean a lack of communication or the inability to visit friends and family. It is in-fact freedom.
Go where? Well, the world’s your playground, so go wherever you want. And I encourage you to do this, just as I did. Not all destinations are tax farms. There are many beautiful tax havens in the world. And most countries that are not tax havens still have lower taxes than the UK & the USA.
I do in-fact know how difficult it is to emigrate to another country. It has it’s challenges, but also it’s rewards. It’s true that immigration is inconceivable to most sheeple, that’s why they will stay on their chains, and continue to lick the hands that feed them.
Freedom is for those who willfully choose to embrace it, not for those who are too fearful to imagine it. Those of us who are free to travel are actually free to relocate, if we have the courage and means to do so. We are free to explore the world, and to find any place we desire to settle down. So please try not to be so negative about your freedom. Freedom is not really free, and not really realized until it is exercised.
If you are saying you want to enjoy the benefits of living in an organized society, which include police and fire protection, good quality roads, electricity, schools, building codes that allow you to work and live safe buildings, personal and property rights protected by the courts, etc…… and yet you do not want to pay taxes to support all of this, then you’re just being selfish.
How can all those people in the comments take very centralized electric and telecommunications infrastructures and companies for granted and disperse unfounded anarchist matrix ideas?
andrew, as crazy as you may think darren braithwaite is, or sounds, i agree with him and i am keen to answer your questions. the first question those who advocate for the state always pose is “without government who would build the roads?”, to which i generally reply with this: https://fbcdn-sphotos-c-a.akamaihd.net/hphotos-ak-prn1/14222_380450198709710_961403443_n.jpg
but jokes aside, there are plenty of private roads, private hospitals, etc. infact almost everything that is currently done by government was once done privately by citizens. i would contend that the reason these things were driven out of the private sector into the public sector was largely due to taxation. taxation is not a voluntary transaction – as opposed to transactions undertaken in the private sector. people do not get to choose if they want to pay their taxes – its pay up or go to court. therefore when money is extracted from the population and put to “good use” (maybe in building a road, or providing a “free” bus service) whatever private companies were previously operating in that market are now at an unfair disadvantage. for example, a tax funded bus service cannot compete with a private bus service because people will inevitably take the “free” option. not to worry if the tax funded service actually costs the tax payers double what the private one would have, it is now in everybody’s best interest to use the publicly funded service. ie people have already had their taxes forced off them for this purpose, so only if the public bus service is atrociously unreliable will they disregard it.
i suspect darren is an anarcho capitalist. i am one. if you have more questions i’d be happy to answer them (i’m not sure if this forum will notify my inbox if people reply to me?). also there are some answers to common objections to anarcho capitalism here: http://networkedblogs.com/DNWVg
this is by no means a new idea. it may not be a particularly mainstream one but it has had some respectable intellectual advocates over the centuries, including lysander spooner, friedrick hayak, robert noizick and to some extend milton friedman. in my opinion the main thing which keeps people from embracing the notion of a stateless society is a general mistrust of the ethics of their fellow humans. but governments and regimes are similarly made up of such humans and generally statists feel confident in trusting these.
personally i see a lot of benefits in a stateless society – withdrawing my monetary consent from wars is one, enhanced freedoms (such as drug legalisation and gay marriage legalisation) are another. the advantages in general economic wellbeing for the entire population would also be immense.
ciao