Tuesday, July 23, 2019

Tax avoidance; a debate easily resolved Assignment

Tax avoidance; a debate easily resolved - Assignment Example According to, European Commission: Consultation on Double Non-Taxation Cases. (2012, May 1), tax avoidance is an approach where individuals use the legally provided tax policies to reduce the burden of taxation on them. In as much as such act is legal we will find that morally it is repugnant. In addition, the UK law tries as much as possible to minimize the loopholes that individuals are likely to use in tax avoidance schemes. The challenge though has been the sheer fact that the UK tax law is targeted as opposed to being purposive. There has been a consistent crop up of schemes that go around the law and these have further fueled legislative action. It is in record that so many commentators have advocated for the formulation of legislations to counter tax avoidance in general. This has been fueled by the fact that the establishment of the GAARs would ensure that efforts by the public to avoid taxation are thwarted (Freedman 2004). This further ensures that the taxpayer and the lawm akers divert their energies and efforts to other more productive activities. The tax authority is as well given the chance of being in the position of simplifying the law without being undermined. Among many other things, tax avoidance has been viewed to as well be an ethical issue in business. Companies have been found to seek for the minimization of their tax liabilities as a part of good governance through tax planning. They do so by making use and exploiting all the tools made available to them by the governments of the day (Sikka 2013). Such tools include allowances given, deductions advanced, and rebates. While tax planning is an open, convenient and compliant behavior, tax avoidance is a complex issue for most companies in the UK. Tax avoidance is a legitimate and it is the use of tools such as financial instruments to achieve tax desires that are favorable to the taxpayer while unanticipated by the government. Companies can employ the use of overseas

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