The LDV debate: Should politicians release their tax returns? Part One

The issue of politicians and their tax returns has been in the media once again recently, sparked in part by increased scrutiny of tax avoidance measures. The prime minister has said (via the chancellor) that there are no plans to publish his returns, while the man who would like to be in his shoes, Boris Johnson, said on a trip to the US last week that other UK politicians should follow his lead (and those of their US counterparts) in publishing their returns.

Here. the Voice’s Nick Thornsby and Paul Walter debate the issue. Please do share your thoughts in the comments below.

Nick Thornsby: Like the prime minister, I am “relaxed” at the prospect of him and him alone releasing his tax returns for public consumption. Any individual is welcome to do so. But we know, of course, that this is unlikely to be isolated to the PM himself: the floodgates will be open, and all senior and aspiring politicians will, in time, be forced to release theirs. Hooray, some might think: a victory for transparency. I disagree.

Being an elected representative is a job. It might be a job in which personal characteristics and history are unusually important, and which attracts much greater scrutiny than others. That is as it should be in a democracy. But it remains a job, and as such we should jealously maintain a distinction between the private and the public lives of politicians. Most would agree with that, I think, and the question is therefore where we draw the line.

In some respects, I think we have already invaded too far into the private lives of our politicians. It is why, for example, I thought that Nick Clegg’s son’s schooling was none of our business.
Because ultimately, whatever current antipathy the public has to individual politicians or “the political class”, politics remains vital: modern democracy cannot exist without politicians. So while we continue to choose democracy as the system by which we organise our society, we should do the best we can to ensure that politics attracts a diverse, intelligent and thoughtful group of people. It may appear ironic, but calls for “greater scrutiny” of this sort is likely to result in a less experienced, less able and more venal House of Commons.

Paul Walter: I believe that Cabinet ministers (including the prime minister) should, by convention – not law – reveal their tax returns for the four years previous to their taking office.

This is similar to the long-standing situation in the United States whereby candidates for President and Vice-President, cabinet positions and other senior posts, publish their recent tax returns. This dates back to 1913 and Franklin Roosevelt, when he was Assistant Secretary to the Navy and had gross annual income of $1.4M, or $34M in today’s money.

In the UK in 2012, Boris Johnson and the other candidates for Mayor of London published their tax returns for the previous four years. I believe this sets a healthy precedent in this country.

Politicians should have the choice of whether to release their tax details, and the public have the right to judge the choice they make. Interestingly, four of the richest people ever to run for high office in the USA didn’t release their tax returns or quibbled and partially did so (in the case of the first of this list): Mitt Romney, Ross Perot, Steve Forbes and Meg Whitman.

The public have a right to judge the readiness of candidates for high office to reveal their recent tax returns. If they are revealed, the public have a right to judge the contents of those returns.

The case of Mitt Romney is interesting. Him and his wife have wealth estimated at a quarter of a billion dollars. He vacillated about publishing his tax returns when he ran for President in 2010. When he finally released them, under pressure, they showed he had paid a remarkably low tax rate of 13.9% in 2010. That episode, I suggest, spoke volumes about Romney’s leadership skills and fitness for the top executive role in the USA.

Part 2 will appear on the site later this week; in the meantime, do share your thoughts below.

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47 Comments

  • Perhaps we should adopt the Norwegian system, where everyone’s tax returns are available online.

  • paul barker 16th Feb '15 - 6:14pm

    There are often complaints about how Politicians are different from normal people, lets not make them more different. Either publish everyones Tax returns or no-ones.

  • John Broggio 16th Feb '15 - 7:18pm

    WH – that’s tax evasion. Publishing returns would show the income *and* the means by which it was “nullified” for tax purposes.

  • Why should anyone’s tax payments be a secret?

    I do not subscribe to the line– “if you have done nothing wrong, you have nothing to hide.” but I see no reason at all why tax should be a secret.

  • Little Jackie Paper 16th Feb '15 - 8:53pm

    ‘Why should anyone’s tax payments be a secret?’

    Because of privacy. Something I and a good few others value. We live in an age when privacy has been hopelessly debased. We hose details of our lives onto the internet, we have normalised intrusive journalism to the point where the behaviour of newspapers doesn’t shock us (arguably we make excuses).

    As it is I do understand the intention behind publishing tax returns, but I fear it’s just another slippery slope – there perhaps are other ways to achieve the same end. But my tax payments should be secret because they are none of your business.

  • jedibeeftrix 16th Feb '15 - 9:09pm

    “Why should anyone’s tax payments be a secret? ”

    Because i reject that degree of social solidarity which requires everyone know the particulars of everyone else.

  • Philip Rolle 16th Feb '15 - 9:40pm

    We have got ourselves worked up into such a lather about tax evasion and avoidance. This is therefore hardly the time to consider making public matters which have long been regarded as confidential.

    If politicians have to disclose their Tax Returns, why stop at Cabinet ministers?

    Why stop at Tax Returns? Let’s have assets statements!

    No, no. no.

  • I think the right to privacy cannot be absolute for politicians. I agree that the Clegg’s choice of school was no ones business but their own, however I had zero sympathy for Dianne Abbot when her choise caused such uproar a few years ago. She made her bed by being so vociferously against public schools then choosing one….

    In terms of tax returns, where a wealthy politician makes a great play about ensuring everyone pays their fair share they have left themselves open to be challenged to prove that they do..

  • Tony Dawson 16th Feb '15 - 9:56pm

    It would appear that Norwegians are not at all up themselves about their income and taxation being public.

  • With the complete lack of trust in our politicians with the general public I think all elected MP’s should be obliged to publish their tax returns. The moment you take up public office you should be ready for complete public scrutiny. I’d certainly have no issue doing so if elected.

  • A Social Liberal 16th Feb '15 - 10:42pm

    I haven’t yet seen a compusive argument against publishing. I believe that some already do so voluntarily

  • I think Gareth, you have misread what is being said, allow me to rephrase your statement: “The moment you [apply for] public office you should be ready for complete public scrutiny.”

    Because, as we’ve already seen in the UK, US and other countries the daft levels of muck raking that is already occurring as both media and opposing political parties dig into opposing politicians (and their supporters and financiers) closets, trying to turn anything they find into something sensational.
    And to those who say, “if you’ve got nothing to hid…”, sorry I don’t believe you understand the situation. The issue isn’t where you have or haven’t done anything right or wrong, but whether it can be misrepresented to smear either or both you and the party you stand for. A good example if this is the mudslinging initiated by Ed Milliband over Stanley Fink’s Swiss bank account.

  • For those who are arguing for publishing tax details along with related information. I assume you have all put all of your own tax payments, income and net asset position in the public domain?

    If not I suggest you do so before asking others to do so.

    If anyone is thinking of arguing that they only will when everyone else does then you have already recognised it is not as vanilla as you would like others to think.

    This is simply another version of “if you have nothing to hide you have nothing to fear” I would question how many people would be comfortable using that argument in many other contexts.

  • Julian Tisi 17th Feb '15 - 9:38am

    What Roland says.

  • Julian Tisi 17th Feb '15 - 9:38am

    … and Psi!

  • Ed Balls does not get receipts from his window cleaner, George Osborne told viewers about care trusts. These stories are published, tweeted and commented on as they suit a narrative where big beasts make moral declarations about tax avoidance contrary to their own actions. Who does not think this is ‘fair game’? Publish returns and we’ll see a few ‘dodgy’ sorts publicly lambasted and a desire by those coming in to appear whiter than white.

    If all my e-mails are accessible to GCHQ why not make those passing laws more accountable – what’s good for the goose! Is it not better to let the sunlight in? Feels a bit like expenses again – there is no appetite to address this problem in politics as no one comes out with any credit.

    A few years ago I would have opposed this for the reasons eloquently given above. However tax has become a moral issue (for all parties), recall is so watered down so as to be pointless, and I think this at least hands something to the voters to say politics is cleaning itself up!

  • I’m aware that my comment in response to other commenters didn’t touch on the arguments in the original post. If we exclude some of the rather extreme suggestion in the comment I think Paul Walter has a perfectly work able proposal of having a convention of choosing to release. We would also have to accept the limitation that is visible from Nick Thornsby argument that this approach is severely limited as it could only be the tax returns of the individual and could not start spreading across family members.

  • Little Jackie Paper 16th Feb ’15 – 8:53pm
    ‘Why should anyone’s tax payments be a secret?’

    “Because of privacy”.

    Why should tax be private? It is a public matter. It is not a private matter. There is nothing you need to be secretive about.
    The colour of your hair is a private matter but I assume you do not go round wearing a balaclava 365 days of the year in case someone invades your privacy by seeing what colour your hair is?
    Hair colour is much more of a private matter than tax payments.

    Why would you want your tax payments to be private and secret? Who are you wanting to hide them from?
    I honestly do not see your point.

  • Tony Greaves 17th Feb '15 - 3:18pm

    Of course everyone ought to have to reveal their assets (elected politicians and indeed members of the Lords already have to go a small way towards that in their declarations of interest). Why not? As the saying goes, “if you have nothing to hide…”

    Tony

  • JohnTilley

    Perhaps it would help if you posted the link to where you lead by example and post all you Income, Assets and taxes paid (shall we throw in expenditure just to prove you aren’t asking trades people to do cash in hand, perhaps we can let you off that one)?

    Your example about hair, aside from being a very odd example, does not hold up. I know a woman in her late fifties who has died her hair for fifty years, has it regularly maintained and doe not even give it time to rest (despite being advised to do so). She doesn’t wear a balaclava but you wouldn’t have a clue what her hair colour is naturally.
    Other individuals from different religious groups also don’t wear a balaclava but they do cover their hair, you wouldn’t know what their hair colour is.
    No one has the right to know anyone else’ hair colour many people choose to allow you to know, as they leave their hair uncovered. That is a choice individuals make whether you can know or not. The nature of privacy is not that other can’t know something it is that the person’s who’s information gets to choose.

    “Why should tax be private? It is a public matter. It is not a private matter.”

    Why is it a public matter? My income, my property are private any taxes I pay on private information is private. If your suggestion is that because it is part of a transaction with the state well so is the use of health services. Should everyone’s health records be public? The rest of the taxpaying population paid for the treatment? How about children’s schools reports and grades (of course that would exclude the children of the rich at Eton)?

    “There is nothing you need to be secretive about.”

    Need, oh dear. How much privacy do people “need” is totally subjective and far to dangerous, if it relates to me in a private action then it is private.

    Have a think about that applied to liberty? How much freedom do people “need” well there is a licence for any authoritarian reigeme. I guess we better let that snoopers charter in right now, as Mrs May has decided it allows you as much liberty and privacy as you “need.”

    If my Great Uncle Nebuchadnezzar decides to give me his copy of Das Kapital rather than any of my cousins it becomes my asset, there is no “need” for the other cousins not to know that I have been given the book but if Neb and I choose not to tell them they have no right to know.

    I note you have provided no line where you think privacy does exist, can I take it you would draw the line at some point before the Daily Mirror and the News of the World hacking in to people’s voicemails?

  • Tony Greaves

    “Of course everyone ought to have to reveal their assets (elected politicians and indeed members of the Lords already have to go a small way towards that in their declarations of interest). Why not? As the saying goes, “if you have nothing to hide…”

    Tony ”

    There was another Tony who used to use that argument a lot (or had others use it on his behalf). What was his name? Tony… Tony.. B… Tony Bl… ah,

  • Psi 17th Feb ’15 – 5:33pm

    I was a civil servant for 38 years before I retired so my salary has always been public knowledge.
    My pension which is my only income is also a matter of public record.
    I pay income tax on my pension at the standard rate without any perks or allowances.
    My wife and I own our house (current value on Zoopla).
    We have no other assest just the contents of the house (the insurance policy says not worth much) and a 13 year old Nissan Micra (you could look up the secondhand value).

    So you see it is all out there already.
    I even use my real name here in Liberal Democratic Voice. You should try it.
    Openness and honesty are liberating.

  • So to summarise: you don’t publicly disclose those details.

    So what about the other points?

  • John Broggio 17th Feb '15 - 7:14pm

    It’s all a bit poker-bluff territory at the moment. If anyone was the first to show “us” “theirs”, there’d be a grossly disproportionate amount of (media) interest. If everyones was released simultaneously, not so much for those out of the public eye.

    Given that this happens quite successfully in a country not so very far away from the UK, why do some assume that we couldn’t do this here? A very defeatist attitude…

  • Psi 17th Feb ’15 – 6:46pm

    I genuinely do not understand what your problem is. I answered your original question and you then chose to misinterpret what I have said with the words — ” So to summarise: you don’t publicly disclose those details.”

    You know that the word ‘summarise’ does not mean deliberately turn words on their head. So what is your game?

  • stuart moran 17th Feb '15 - 9:47pm

    To all these fans privacy for MPs

    Surely we know what MPs earn

    http://en.wikipedia.org/wiki/Salaries_of_Members_of_the_United_Kingdom_Parliament

    All very public – from that we can easily calculate the tax take based on PAYE

    What then should be so secret about what else they earn and how much tax they pay on that? Surely everything is declared to the standards department and so there shouldn’t be any shocks should there?

    What most public sector workers earn is also known, as is the case for directors so why is the tax paid by them on that such a secret? If you know the salary then the tax should be the same as someone else earning the same money unless some deductions are made – and what is wrong in that tax number being known alongside the salary for certain people?

    I believe the PM was going to make his tax affairs public after suggestions that he and Osborne gained form the reduction in tax to 45% – still waiting!

  • Peter Chegwyn 17th Feb '15 - 10:18pm

    Good to see Simon Shaw publishes details of his expenses on his Birkdale Focus blogsport page:

    http://birkdalefocus.blogspot.co.uk/p/simon-shaw-expences.html

    Pity he can’t spell the word ‘expenses’ though.

  • “Why would you want your tax payments to be private and secret? Who are you wanting to hide them from?” (JohnTilley).

    I think the real questions are; why do we want details of people’s tax affairs in the public domain? and what is it that we believe this will achieve? and are there other ways of achieving this?

    However going back to the point John was making, there are very good reasons why you don’t want lots of personal information in the public domain, as I indicated previously, these aren’t necessarily to solely down to the naive idea that only someone who has something to hide will oppose publication, but are more to do with the unintended consequences and opportunistic behaviours that are enabled through having such data in the public domain, which these days means being accessible from the Internet (note there is vast difference between something being “a matter of public record” and it being “published” in the public domain). Obviously, as more personal data is leaked/released into the public domain, it becomes a commercial (both legal and illegal) resource to be linked together and mined, just as the supermarkets mine their loyalty card data today.

    Additionally, given the circumstances of the current highly charged political tirade on “tax avoidance”, we need to also look at people’s financial records in terms of what they omit. So whilst someone can be a basic rate tax payer and never have submitted a tax return, it doesn’t mean that they have “nothing to hide” – in the current climate, not declaring something like a capital gain that is under the HMRC reporting threshold, wouldn’t stop a desperado, like Ed Miliband for example, from making accusations of “tax avoidance” or even “tax evasion”, even though it’s omission is because of a totally legitimate “tax mitigation”.

    I therefore think we need to be very clear about what exactly we are trying to achieve here and whether it really will result in some better politicians and better decisions, because there is a price to openness.

  • The issue should be about whether all tax receipts should be public. If politicians were obliged to publish their tax records, it would not be long before politicians would require everyone else to do so too. We live in a world in which there is diminishing privacy, this is not particularly an argument to say that personal income should remain private, but it would be part of a disconcerting trend.

    I do think that there is a strong case for establishing limits to the invasion of privacy, then this issue could be assessed in that context.

  • John Tilley

    Simon Shaw has pointed out how you have not answered the question as you claim.

    There are the two following questions outstanding as well that you have ignored twice:

    Why do you consider someone’s income, wealth and tax payments on those to be public matters not private matters?

    If you consider so many matters to be public , where do you draw the line for peoples right to privacy?

  • Stuart Moran

    To clarify, I (and I think several others) are less concerned about the privacy of MPs , what this appears to have turned in an assault on normal citezens privacy. Some people on here would dive us a distopian world where you could snoop on your neighbours by looking up on line what the earn, own, pay in tax or collect in benifits.

    I know many people who would be horrified at the prospect but we don’t live in a world where everything is viewed through the lense of “these evil rich people are doing stuff I don’t know about”

  • stuart moran 18th Feb '15 - 5:52am

    Psi

    But there are plenty on here and in the Coalition who are prepared to view life through the lens of ‘it is those poor people fiddling all their benefits’ though isn’t there?

    Shirkers vs strivers, financial crisis all due to public spending etc etc

    I am not that sympathetic to the rich at the moment – they seem to have won from the recession. Our CEO had a 50% rise in renumeration despite the company message being we had done badly, forced transfers, redundancies and cost-cutting everywhere. All problems due a poor implementation of his strategy!

    I know how much he apparently earned…..I would also be interested to see how much of this extra cash he actually paid in tax – did his tax bill go up the same amount as his pay?

  • Tax is not a private matter it is a public matter.

    All this talk about “privacy” is nothing more than a bucket of red herrings. It smells worse than old fish.

    People who are not even prepared to use their real name in this forum but complain because I have not set up a website to detail my own tax affairs are really beneath contempt.

    Simon Shaw uses his own name and as Peter Chegwyn points out even publishes some of his income in his
    Focus, which is commendable.
    BTW Simon, my entire personal expenditure is less each month than you claim for trips to London for LGA meetings; but coming from a posh place like Southport – the Paris of the North – you would probably be surprised that anyone can possibly survive on such a pittance. 🙂

  • Stuart Moran

    Leaving aside whether your description is an accurate reflection of people’s views , who do you think will be most effected by removing privacy in financial matters? Is is much more likely it will busybodies checking up on people local too them.

    Rights exist to protect us all. This trend of people saying “can’t we get rid of this right for terorists/rich CEOs/ the latest boggy man” is constantly pulling at threads which unravels rights for the rest of us.

  • Public information is already exploited by high pressure and invasive sales techniques. I have had cold callers trying to persuade me to put money into this or that – except you do not know at the start what it is all about. It would be even more annoying if these people had access to records of my personal finances.

    Those who advocate that tax returns should be public need, at the very least, to explain how the vulnerable would be protected from exploitation.

  • John

    So that is another “no answer” then.

    If you have a case for stripping the public of there privacy I suggest you make it.

    You have just provided another straw man. I am not complaining you have not set up a website. I don’t care what your finances or taxes are. I , unlike you, don’t see it as my business to be able to poke my nose in to everyone else’s business provided they are acting legally.

    The point you are, I have to assume deliberately, missing is that if you expect action of others but won’t do so yourself voluntarily then your argument is hollow.

  • >a 13 year old Nissan Micra
    >my 17 year old Volkswagen

    Sounds as if a popular policy is to rerun the scrappage scheme …

    However, the only problem is that my 12+ year old Ford’s have proved to be more reliable, secure and cheaper to service and maintain than my neighbours car’s purchased in the last couple of years… 🙂

  • stuart moran 18th Feb '15 - 5:45pm

    Psi

    Unfortunately some of your party are only too happy to take rights away from the poor but then that is okay because they are powerless

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