This issue – or confusion of issues – has been troubling me for some time. Let me start with three declarations. First, I used to be a tax lawyer. Second, for me, the obligation to pay tax can ultimately only be a legal one, and not a matter of morals. Third, I’m not in favour of complex, elaborate, or artificial, tax avoidance schemes.
“If we truly believe in the rule of law, there can be no residual notion of a moral obligation to pay tax.”
First, some basics. The purpose of taxation is to finance the State. Indeed, the origins of tax lie in raising money to finance wars. (As an aside, because of the unwillingness of earlier generations to contemplate a permanent state of war, even today income tax is only an annual measure which has to be confirmed and reimposed by Parliament every year, hence the need for an annual Finance Act. So what irony, then, that although we raise more than enough money each year through taxation to finance our defence, governments of all persuasions in recent years have so cut back on defence funding in their allocation of tax revenues raised that our ability to defend ourselves effectively must now be questionable.)