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Why is tax still so expensive?

Simon Gibbs

This research from the TPA, spotted over the weekend, was described as staggering. Frankly, I’m more angry than suprised:

HMRC has failed to collect tax more efficiently despite inventions such as the first handheld calculator in 1967; the microprocessor in 1971; Microsoft Windows in 1985; and the World Wide Web in the 1990s. Even after all these new time saving inventions the cost of collecting tax has only fallen by two per cent in just over 50 years.

The articl does not speculate as to the reasons why, but I have a feeling it is something to do with somebody, somewhere having a budget and wanting to keep it. And probably more than a little to do with this.

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5 responses to “Why is tax still so expensive?”

  1. Paul Marks Avatar
    Paul Marks

    It is one of basic rules of politics that campaigns against waste and to improve effciency do not save much money.

    Indeed it is often the campain that “reorganisations” (of which there have been so many – starting in the 1960s) lead to a vast INCREASE in administration costs. Inspite of the “effciency experts” (including ones imported from private business) saying they will save money.

    Examples of money wasting efficiency drives and reorganisations are legion – especially in the NHS and in local goverment (the local government reorganisation of the early 1970s was particularly bad).

    Overall trying to do things “better – smarter” as politicians and “experts” say, turns out to be fool’s gold. Especially (I am sad to say) if computers are involved in the idea – if computers are involved (even with, supposedly, the best experts in charge) costs go up and up (basically into outer space).

    So how can government save real money?

    There is one way to save big sums of money – and one way only.

    Look at the various FUNCTIONS of government (the things it tries to do – and normally messes it up) and decide “we are not going to try to do X, Y, Z, anymore”.

    That is it – that is all it is.

    Look at all the things that government tries to do – and stop trying with some of them.

    Reduce “the functions of government”.

    Do not try and “reform” government departments (you are just bashing your head against a brick wall – and that is AT BEST).

    GET RID OF some of the government departments (wholesale) – and NOT by moving their functions to other departments.

    Just stop trying to do these things – get rid of these “functions” of government.

    By the way – bringing in private contractors to deal with the “coercive” functions of government (such as tax collecting) is not a good idea.

    As even Murry Rothbard (the anarchocapitalist) noted – such things should NOT be privatized (he argued they should not be done at all – but he accepted that handing them over to private contactors was even worse than leaving they as they are).

    “Tax Farmers” (private tax collectors) tend to be even worse than government tax collectors (worse for the people they plunder).

    And the words “Capita” and “Capita Raz” (or whatever it calls itself) open the door to a lot of bad memories of the taxpayer being looted.

    Still if you want “admin savings”…

    Get rid of high pay (especially pushed by Labour after 1997) and special bonus payments (all of them).

    “But that means that government departments will be inefficient”.

    Anyone who says that has not read the above – of course government departments will be inefficient (and in some cases it is acually worse for the people if they are not inefficient). Increasing the pay of government workers and handing bonus payments will not change that – it is just a cost without a gain.

    The Civil Service (if it has to exist at all) should go back to 9 to 5 (with an hour off for lunch). Low pay – but no chance of getting sacked. And a low (but safe) pension.

    And office life?

    It should go back to lunch and the “two bells” being the hightlights of the day.

    “The two bells?”

    Yes – the bell that was rung from the trolly when the lady came round (floor by floor in Civil Service buildings) for morning teas and coffee (plus cakes and buns) and in the afternoon. Hardly the James Bond idea of govenrment work – but then do we really want Civil Servants like James Bond?

    Besides there is always one’s spare time (unpaid) for such stuff. Silly or otherwise.

    The Civil Service did far less harm in those (pre New Labour) days.

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  2. James Rigby Avatar
    James Rigby

    I don’t think it’s inherent ineffeciencies alone – although these are many. It’s the fact that the tax system has become so complicated. They can’t even get PAYE right some of the time – and if anyone’s tax affairs are more than the most basic, it becomes a minefield. Simple tax is cheaper to collect – so we pay less tax. Simples.

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  3. Tim Carpenter Avatar
    Tim Carpenter

    To me, if we have a Civil Service, they key is integrity first.

    Lower pay in exchange for security and modest but guaranteed pension is fine. Dismissal and loss of pension for those who are corrupt or dishonest. Honest but lazy is far better than unscrupulous and tireless!

    If one wants high pay and bonuses, expect to get sacked if you screw up. Do no expect the same pension:pay ratios. Or is that cake:eat it ratio?

    I also agree that some things should not be outsourced and in particular, tax collection. It has been done many times and failed many times, Jacques!

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    1. Paul Marks Avatar
      Paul Marks

      Even if they are honest hard working “public servants” are sometimes a bad idea.

      They will try and effect the world (to “do us good” by manipulating our behaviour – “Nudge” style, and remember the forward to that book was written by the “Freakonomics” guy, so this sort of mind control, totalitarianism by the installment plan, is mainstream).

      Lazy is not good either (although not as bad). Basically if there have to be “public servants” (and we can have the anarcho-capitalism debate another time) they should be conservative (small c).

      People who do their jobs in a predictable way (and treat everyone the same) – people who may actually be intelligent, but do not try to be “clever” and manipulate people (do not have “wider social goals”).

      The ideal “public servant” is a person who is at their desk promptly at 0900, leaves promptly at 1700. And whilst at work collects taxes (or whatever) in an honest way (without fear or favour).

      If such people wish to be “creative” they can be so at home – for example working to create a nice garden.

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  4. Tim Carpenter Avatar
    Tim Carpenter

    “Wider social goals”…the utter CONCEIT of such people!

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