Practice what you preach: Tax avoidance among the rich and famous

Dodging tax with little to no retribution seems to have become the norm in recent years for celebrities, politicians, and business tycoons. Unfortunately, we have grown to accept it and despite the enormity and frequency of scandals, tax avoidance continues to be swept under the rug.

In the aftermath of the HSBC tax scandal, yet another public figure has come under fire. Fashion designer come political activist Dame Vivienne Westwood, known for her strong sense of political justice, was accused of tax avoidance recently when it was revealed that Vivienne Westwood Ltd was paying £2 million a year into an offshore bank account in Luxembourg.

Though the company asserted that substantial UK taxes were paid, Westwood’s personal donation of £300,000 to the Green Party, which ironically campaigns against tax havens, was also called into question, but the designer stated: “It is important to me that my business affairs are in line with my personal values. I am subject to UK tax on all of my income.” She later added: “My personal donation to the Green Party reflects my desire to see a more equitable and sustainable society.” It is easy to wonder if Westwood will stop using offshore bank accounts once the Green party achieves an “equitable society”. 

Sadly for Britain, Dame Westwood is not the only culprit, indeed there are many examples of this behaviour amongst the famous and talented. The Arctic Monkeys sing the trials and tribulations of working class life, whilst making use of the Liberty tax scheme. Bono, like Westwood in some ways, has been a consistent face of political activism and charity campaigning despite U2 moving their entire music empire to the Netherlands to benefit from their lower tax rate. Billionaire Phillip Green, owner of Topshop, a brand known for its numerous charitable campaigns, could be crowned king of the tax avoidance clan, paying a £1.2 billion dividend to his wife in Monaco, thus avoiding UK tax.

In light of the mounting allegations against those in the public eye, it is important to define where the inevitable double standards lie. Sadly, we somewhat anticipate big businesses to crunch their taxes into novelty miniatures of what they ought to be, but how can the public be expected to revere those who so often fail to practice what they preach?

It’s arguable that as long as it’s legal, people and companies should be able to do what they want with their money. Tax rates for higher earners are so enormous, one can, therefore, understand that some may attempt to avoid giving away nearly half of their income; they earned their wealth, after all. But with a struggling NHS and unpaid taxes reaching into the lofty billions, surely these rich superstars should feel a sense of social responsibility?

Celebrities need to recognise the overarching sense of responsibility which comes with their sought out careers. They have a social duty to lead by example, to behave in an ethical and moral manner because, whether we like it or not, the general public are easily influenced by the personalities who placard our media channels daily.

Unfortunately, however, this sense of responsibility is often overshadowed by the desire to accumulate wealth and protect one’s assets. This is not helped by the fact that tax dodging is openly publicised as a victimless crime. Justice has become a pricey business, and taking these multi-millionaires to court along with their army of lawyers and accountants is a seemingly impossible and pointless feat, enabling them to get away with it right under the noses of the powerless millions.

With tax avoidance, whether illegal or not, comes severe damage to public morale and a dent to social attitude. When there’s one rule for some, and one for everyone else, one can wonder how the general public is to stay motivated for the common good. No matter how we try, it’s difficult to support a government which so brazenly works in the pockets of the rich, and a system which is so unapologetically designed for those with money, fame and power.

The truth is this: if people in the public eye, superstars and billionaire businessmen and women alike, start to contribute to society as stand-up citizens, those outside of the spotlight will undoubtedly be encouraged to follow suit. In turn, tax avoidance would become unacceptable and the general public will stop feeling as though they are at a financial disadvantage from those with fame and influence. For now though, we can only hope that tax avoiders be somewhat reprimanded. 

Elizabeth Finney