The tax revolution begins with transparency

"The Art Of Taxation Consists In So Plucking The Goose As To Obtain The Largest Number Of Feathers With The Least Possible Amount Of Hissing."

So said Jean-Baptiste Colbert, Chief Minister to King Louis XIV.  The taxes that cause the most hissing for Britons today are...

Council tax...
Stamp duty...
Inheritance tax...
The TV licence fee...

What do they have in common?  We write cheques for them.  Taxes are most unpopular when we feel them plucked directly from us.

When in America it is often annoying to have chosen your purchase and then find it's more expensive at the till because of the tax that is added at the point of sale.

This idea and the wider idea of tax transparency is the subject of a Ten Minute Rule Bill being introduced by Nigel Evans MP in the Commons later today.  Speaking to ePolitix.com Mr Evans wants receipts for goods to include a statement of tax paid:

"Many people really don't take too much regard of how much taxation they're paying when they buy products.  We know that when people are buying things like food from supermarkets... there's no VAT on it.

But of course there's VAT on virtually everything else, certainly when you go to a restaurant there's VAT, when you fill up the car with petrol there's not only VAT but there's other customs and excise duties on that, the same with alcohol and cigarettes."

There is a demand for this transparency.  A poll of 400 super consumers by APCO Worldwide - released exclusively to ConservativeHome - found that 79% would like to see the amount of tax they pay to fund the NHS stated clearly on their wage slips.

Mr Evans' specific idea is a relatively small one but the idea of tax transparency has far-reaching implications if pursued to its logical conclusion.

Comments

[Ken Stevens]

"receipts for goods to include a statement of tax paid"

" amount of tax they pay to fund the NHS stated clearly on their wage slips."

An admin loading on businesses (i.e. computation/reprogramming of systems) for info that might be good in principle but far outweighed by the expense of providing it?

After an initial flurry of interest, I doubt whether many folk would take much notice thereafter.

[Ian Evans]

Some receipts already do this (e.g. I think Lidl does). But how many people look?

Before imposing extra burdens on business (surely not a very Tory idea) some polling might be in order.

[brian]

"An admin loading on businesses..."

I agree, so a better solution would be to print the tax breakdown on the annual P60 that everyone gets. The advantages are:

1) The figures are in one place once a year
2) You can directly compare them to what you paid
3) It would be a relatively simple change at the revenue
4) No impact on business payrolls

Taaa-daaahhh!!!

[Everyone's favourite ingredient]

A burden on business? Rubbish!

My Sainsbury's receipt is already full of stuff about how many points I have on my Nectar card and how I can get a free bottle of wine if I spend £35 in my next shop. Adding two or three lines on tax would be dead easy.

[James Sproule]

My own favourite would be to have a graphic on every petrol pump, showing the percent of taxes and duties being paid for every litre. The reason there is not a tax rebellion is at least in part because most people have no idea just how much tax they are paying.

[Editor]

Matthew Elliott of The TaxPayers' Alliance has blogged on this topic over at CentreRight.

[Cleethorpes Rock]

It shouldn't be too much of a burden. All they need to do on the P60 is multiply the amount of tax paid by the fraction of the total budget taken up. So Social Security at 55% x £2500 of tax = £1375 to scroungers, hook-handed malingerers and Vicki Pollard-types - simple!

[Phil C]

This morning's Waitrose receipt already breaks my shopping down into VATable and non-VATable items and shows how much VAT I paid, at the end of the bill. And given that almost all businesses use computerised payrolls, I imagine that showing NHS taxation and general taxation seperately on payslips wouldn't be a problem. Of course, P60s already tell you how much tax and NI you've paid during the year; I imagine most people don't take any notice, at least not until around 30 January the following year!

One step forward for transparency would be to find a way of merging income tax and NI so that the true marginal tax rate is shown (over 30%). I bet we could reduce the number of civil servants required at the same time.

[realist]

Few people would shed a tear if the BBC poll Tax was substantially reduced.Most now recognise that it is pursuing a left wing agenda that they do not like.The fact that they are sending 437 staff to the Chinese Olympics illustrates that they are awash with cash whilst many people are struggling to pay this extravagant tax.

[passing leftie]

People are in favour of proper publicly funded services. They know, in principle, that that means they need to pay tax to get these services. It's in pratice that is becomes a problem. So, it's best to make the process of getting these taxes as painless as possible for the voter. That's why PAYE, duty and VAT are such good taxes, and council tax and inheritance tax are so unpopular.

Your right-wing agenda is to make the taxation necessary for a functioning Western democracy as unpalatable as possible by relying on everyone's innate selfishness.

It's exactly the same with green issues - people want to be green or energy efficient in theory, but until you legislate, they don't get round to it. Look at what people want in principle, and give them the means to fulfil their principles in the most palatable fashion.

The left-wing equivalent would be to give you a bill every time you used any public service at all (using the NHS, sending your kids to school, using roads, locking some up who has robbed you) and then rush in with a wad of £20s to pay it for you.

You seem to think that money spent on taxation is "stolen" or just evaporates into thin air. When large sums of money are spent, there is bound to be waste - just look at any major corporation, but in the main it is spent on things people want and need. For right-wingers, locking people up and "defense" are no-go areas for reductions in public expenditure - for the left, it's the NHS and schools.

Taxation is a social good. It's like a membership fee to be part of society, a form of social insurance. Our net wealth increases almost every year, and it's the amount left in our pocket that should be important to you, not the amount government spends.

[David Belchamber]

Passing leftie at 10.39: I agree with your statement:

"it's (i.e. tax) like a membership fee to be part of society, a form of social insurance" but not the end of the same para:

"and it's the amount left in our pocket that should be important to you, not the amount government spends".

The amount that the Blair/Brown government has spent over 11 years is obscene, when judged by the results. They have wasted billions of pounds of taxpayers money in red tape, inefficient administration, schemes that have not been thought through, the creation of "non-jobs" etc.

For what they have spent, we deserve top-class services. We haven't got them!

[TV Licence]

I only ever use my TV watch programs on Sky such as sky news (which is waaaaay less biased than bbc news), or watch DVD's, i cant remember the last time i watched a BBC program, i dont use thier website and i dont listen to thier radio, so why the hell should i pay for a service i never use!
An opt out would be great and the BBC would be gone in a few months!