Evan Loves Tax

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First
Broadcast

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20100913

In a major new series for BBC Radio 4, Evan Davis ventures into the maze that is our tax system.

He finds out why it's so complicated.

He asks how well - or badly - we make big decisions about tax.

And in this first programme, he explores how we have ended up trying to pay for a European-style welfare state with American-style tax levels.

He meets three former Chancellors - Alistair Darling, Nigel Lawson and Norman Lamont - who talk candidly about their stints steering the tax system.

He finds out why, since the Second World War, public spending has just kept on rising. Even when we decided that paying for it by putting up income tax was unthinkable.

He identifies the moment when that taboo descended, with the help of key players like Chris Patten and Neil Kinnock's Chief Economic Advisor, John Eatwell.

They recall the afternoon in 1992 when the Labour Shadow Chancellor made a fateful blunder. A blunder that still shapes our politics.

A senior advisor to Gordon Brown at both the Treasury and Number 10 reveals why he thinks New Labour missed a crucial, one-off opportunity to lift the taboo and transform the debate.

Michael Jacobs argues Labour failed to coax us away from seeing tax as a necessary evil towards embracing it as the foundation of a civilised society. Arguably, that's why the coming cuts will be so deep.

And Evan reveals the results of a poll commissioned from ComRes for the programme. This asked whether, if tax had to go up, people would rather see any other taxes rise rather than the basic rate of income tax.

Along the way, he encounters a senior detective from HM Revenue and Customs. This reveals a startling link between newsagents in the West Midlands and organised gangs of smugglers. Evan discovers what this tells us about the consequences of our tax confusion.

Producer: Phil Tinline.

Evan Davis explores our vexed relationship with tax.

Evan Davis investigates Britain's complex tax system

20100914

The Coalition is keen to simplify our tax system. But why, asks Evan Davis, has it become so complicated in the first place?

To find out, Evan talks to former Chancellors Geoffrey Howe, Nigel Lawson, Norman Lamont and Alistair Darling; to Gordon Brown's former economic advisor Ed Balls; to Dave Hartnett, the head of HM Revenue and Customs; and to John Whiting, who now leads the Government's new Office for Tax Simplification

Hartnett tells him that, as the man charged with administering it, even he thinks the tax system is too complicated.

The former Chair of the Inland Revenue, Sir Nicholas Montagu, goes further: he says the whole way tax law is made needs to be questioned.

And Evan reveals the surprising results of a poll specially commissioned for the programme on public attitudes to making our taxes simpler.

He traces the story of the reduced rate of income tax. This ended in political disaster for Gordon Brown when he abolished the 10p rate.

Economist Andrew Dilnot argues that the reduced rate was always a needless complication. Yet it was deployed by Labour and Conservative alike to send political smoke-signals to the electorate.

Evan goes on to explore the byzantine world of tax avoidance schemes. These seize on the complexities of the tax code - through such bizarre means as paying employees in 'platinum sponge' - costing the Government billions.

Along the way, Evan hears the tax system described as a triffid, a barnacled ship and a medieval map. And he reveals what he considers to be the funniest line in UK tax legislation. (Clue: it concerns footwear.)

Finally, he visits Christchurch in Dorset and explores how, in 1993, this gentle seaside constituency took up arms against a change in the tax system.

In 1993, Chancellor Norman Lamont simplified the VAT system, by ending the exemption on domestic fuel.

The devastating by-election results that followed still ring in the ears of those who want to see the system made less complicated.

Producer: Phil Tinline.

Evan Davis explores our vexed relationship with tax.

Evan Davis investigates Britain's complex tax system

20100915

Evan Davis asks how well we make decisions about tax in Britain, from the way we vote in elections to Chancellors and their Budgets.

To find out, he meets four ex-Chancellors: Geoffrey Howe, Nigel Lawson, Norman Lamont and Alistair Darling.

Is the attitude of Government when deciding tax policy, Evan asks, usually 'not in front of the voters'?

Evan begins the programme amid the massed ranks of photographers outside 11 Downing St on Budget Day this year. He watches George Osborne emerge to run the gauntlet of protestors, on his way to deliver his Emergency Budget.

He points out that the Conservatives did not go into the last election promising the rise in VAT that Osborne's Budget introduced only weeks later. But that Labour also put up taxes in a way they hadn't put squarely to the public in elections.

He asks whether we could make tax policy more openly - and whether the spectacle of Budget Day itself is part of the problem.

He discusses the seductive theatricality of the Chancellor's annual moment in the spotlight with Nigel Lawson - and Norman Lamont, who cautions against it.

He hears recollections of the backroom pressure in the run-up to the Treasury's big day from former insiders like Rachel Lomax, Private Secretary to Nigel Lawson in the 1980s, and Gordon Brown's ex-economic advisor Ed Balls.

Rachel Lomax went on to become Permanent Secretary at the Department of Social Security.

She recalls the impact the secrecy that surrounds the Budget had on her there. Not least through the surprise announcement in the Budget speech of major changes affecting thousands of staff.

But Evan argues that at the heart of our decision-making on tax, there is a broader problem. Many find it hard to feel any connection between the money they pay and the services they get in return. And he visits the Albert Hall to explain why.

He asks whether 'hypothecation' - specific taxes earmarked for specific services, such as healthcare - is the solution.

He talks to Matthew Taylor, the man who created the much-discussed Liberal Democrat policy of putting a penny on income tax to fund a boost in education spending. And discovers he is against hypothecation.

He finds out how Australia's health tax - the 'Medicare Levy' - ended up funding a gun buyback scheme.

But if hypothecation isn't the answer, what is? Evan concludes the series by raising the underlying question that, for all the argument over the coming cuts, is little asked: what do we want tax to pay for?

Producer: Phil Tinline.

How well do we make decisions about tax in Britain?

Evan Davis investigates Britain's complex tax system

Episodes

Episode	First Broadcast	Comments
01	20100913	In a major new series for BBC Radio 4, Evan Davis ventures into the maze that is our tax system. He finds out why it's so complicated. He asks how well - or badly - we make big decisions about tax. And in this first programme, he explores how we have ended up trying to pay for a European-style welfare state with American-style tax levels. He meets three former Chancellors - Alistair Darling, Nigel Lawson and Norman Lamont - who talk candidly about their stints steering the tax system. He finds out why, since the Second World War, public spending has just kept on rising. Even when we decided that paying for it by putting up income tax was unthinkable. He identifies the moment when that taboo descended, with the help of key players like Chris Patten and Neil Kinnock's Chief Economic Advisor, John Eatwell. They recall the afternoon in 1992 when the Labour Shadow Chancellor made a fateful blunder. A blunder that still shapes our politics. A senior advisor to Gordon Brown at both the Treasury and Number 10 reveals why he thinks New Labour missed a crucial, one-off opportunity to lift the taboo and transform the debate. Michael Jacobs argues Labour failed to coax us away from seeing tax as a necessary evil towards embracing it as the foundation of a civilised society. Arguably, that's why the coming cuts will be so deep. And Evan reveals the results of a poll commissioned from ComRes for the programme. This asked whether, if tax had to go up, people would rather see any other taxes rise rather than the basic rate of income tax. Along the way, he encounters a senior detective from HM Revenue and Customs. This reveals a startling link between newsagents in the West Midlands and organised gangs of smugglers. Evan discovers what this tells us about the consequences of our tax confusion. Producer: Phil Tinline. Evan Davis explores our vexed relationship with tax. Evan Davis investigates Britain's complex tax system
02	20100914	The Coalition is keen to simplify our tax system. But why, asks Evan Davis, has it become so complicated in the first place? To find out, Evan talks to former Chancellors Geoffrey Howe, Nigel Lawson, Norman Lamont and Alistair Darling; to Gordon Brown's former economic advisor Ed Balls; to Dave Hartnett, the head of HM Revenue and Customs; and to John Whiting, who now leads the Government's new Office for Tax Simplification Hartnett tells him that, as the man charged with administering it, even he thinks the tax system is too complicated. The former Chair of the Inland Revenue, Sir Nicholas Montagu, goes further: he says the whole way tax law is made needs to be questioned. And Evan reveals the surprising results of a poll specially commissioned for the programme on public attitudes to making our taxes simpler. He traces the story of the reduced rate of income tax. This ended in political disaster for Gordon Brown when he abolished the 10p rate. Economist Andrew Dilnot argues that the reduced rate was always a needless complication. Yet it was deployed by Labour and Conservative alike to send political smoke-signals to the electorate. Evan goes on to explore the byzantine world of tax avoidance schemes. These seize on the complexities of the tax code - through such bizarre means as paying employees in 'platinum sponge' - costing the Government billions. Along the way, Evan hears the tax system described as a triffid, a barnacled ship and a medieval map. And he reveals what he considers to be the funniest line in UK tax legislation. (Clue: it concerns footwear.) Finally, he visits Christchurch in Dorset and explores how, in 1993, this gentle seaside constituency took up arms against a change in the tax system. In 1993, Chancellor Norman Lamont simplified the VAT system, by ending the exemption on domestic fuel. The devastating by-election results that followed still ring in the ears of those who want to see the system made less complicated. Producer: Phil Tinline. Evan Davis explores our vexed relationship with tax. Evan Davis investigates Britain's complex tax system
03	20100915	Evan Davis asks how well we make decisions about tax in Britain, from the way we vote in elections to Chancellors and their Budgets. To find out, he meets four ex-Chancellors: Geoffrey Howe, Nigel Lawson, Norman Lamont and Alistair Darling. Is the attitude of Government when deciding tax policy, Evan asks, usually 'not in front of the voters'? Evan begins the programme amid the massed ranks of photographers outside 11 Downing St on Budget Day this year. He watches George Osborne emerge to run the gauntlet of protestors, on his way to deliver his Emergency Budget. He points out that the Conservatives did not go into the last election promising the rise in VAT that Osborne's Budget introduced only weeks later. But that Labour also put up taxes in a way they hadn't put squarely to the public in elections. He asks whether we could make tax policy more openly - and whether the spectacle of Budget Day itself is part of the problem. He discusses the seductive theatricality of the Chancellor's annual moment in the spotlight with Nigel Lawson - and Norman Lamont, who cautions against it. He hears recollections of the backroom pressure in the run-up to the Treasury's big day from former insiders like Rachel Lomax, Private Secretary to Nigel Lawson in the 1980s, and Gordon Brown's ex-economic advisor Ed Balls. Rachel Lomax went on to become Permanent Secretary at the Department of Social Security. She recalls the impact the secrecy that surrounds the Budget had on her there. Not least through the surprise announcement in the Budget speech of major changes affecting thousands of staff. But Evan argues that at the heart of our decision-making on tax, there is a broader problem. Many find it hard to feel any connection between the money they pay and the services they get in return. And he visits the Albert Hall to explain why. He asks whether 'hypothecation' - specific taxes earmarked for specific services, such as healthcare - is the solution. He talks to Matthew Taylor, the man who created the much-discussed Liberal Democrat policy of putting a penny on income tax to fund a boost in education spending. And discovers he is against hypothecation. He finds out how Australia's health tax - the 'Medicare Levy' - ended up funding a gun buyback scheme. But if hypothecation isn't the answer, what is? Evan concludes the series by raising the underlying question that, for all the argument over the coming cuts, is little asked: what do we want tax to pay for? Producer: Phil Tinline. How well do we make decisions about tax in Britain? Evan Davis investigates Britain's complex tax system