Tax Avoidance, Adultery, Forgotten!

Tax, Adultery, and Forgetting!

This week I have been musing on three topics, in the news or relating to earlier blogs of mine.

In no particular order, tax avoidance, adultery and the right to be forgotten.

From time to time there are flurries of moral outrage drummed up by the Press and Government claiming that the human instinct to minimise tax liability is in some way “immoral”.

Immoral? Good luck if you ever try to get two humans to agree a definition of what’s immoral. Luckily, as I am a Lawyer, that’s not my problem. Easier, to define what’s legal. And last time I looked, tax avoidance was legal.

The Chancellor is using language which seems to be preparing the ground to change that. Time and again his language refers to his intention to “tackle tax avoidance, tax evasion, and fraud”.

Lump legal behaviour in with crime and sooner or later the thought-police will be knocking on your door. George Orwell and Hitler had views on this.

Tax avoidance is avoiding tax. When I buy clothes for £120.00, I have paid £20.00 tax. When I buy food for £120, I pay no tax. I have avoided £20 of tax because I spent the money on food. Yet the Chancellor is not seeking to stamp out the purchase of food, so far as I understand him.

What he is doing it seems to me is trying to change the meaning of the phrase “Tax Avoidance”, so that it no longer refers to the tax avoiding activities he is in favour of, such as eating, or investing in ISAs, but instead refers to any tax avoidance measure that he doesn’t happen to approve of.

He imagines that we should all “do the right thing” and not take advantage of legal tax savings which take advantage of the consequences of tax law which were not intended by Parliament. “Don’t seek to profit from our mistakes” he says.

There is a school of thought that behaviour improves if those preaching it set a good example in their own conduct and behaviour.

It is hard to see any such good example in the recent case of Jim Dooley reported in this link and elsewhere on the Internet. Jim Dooley is the chief fundraiser for the Bomber Command Memorial Fund. Sounds like the sort of chap we can all approve of. For reasons which are not clear to me, he had received money over the past ten years which had to be returned. He had returned all of the money, but because he had paid £60,000.00 tax on those receipts, he is now £60,000.00 out of pocket. Tax he had paid which with the benefit of hindsight can be seen to have been paid in error.

Ok then, the Chancellor says no-one should profit from tax mistakes, so presumably all Jim needed to do was write to the tax man and get the money back, simples. But, Dearie Me Today and guess what? The tax man says No. His splendid wording deserves repetition “It might appear unfair to deny a customer [customer?] the opportunity to recover amounts of tax that may not have been due”

Yes, I’d say that’s how it appears, all right.

Ok that’s enough about that for this week, what about Adultery?

The subject is in the news because the Canadian “Cheaters” website Ashley Madison has lost its data. So that there is now access all over the internet to the details of their clientele of 33 million “would-be” adulterers.

It is a disaster for any Company to suffer a data attack. Carphone Warehouse has had to report the theft of the names addresses dates of birth and bank details of nearly 2.5 million customers. Those people are at increased risk of targeting by criminals, but at least they do not need to fear blackmail or extortion or divorce for wanting to have a mobile phone.

Today the Canadian Police suggest that the Ashley Madison theft has resulted in suicides. A disaster for those people and for their families.

So my take on all this relates to computer security. Yours and mine. We all know that it is important and those of you who run businesses which store your customers’ details must register with the Information Commissioner’s Office [ICO] for a licence to be a Data Controller. We are legally responsible for the safekeeping of that data. Very substantial fines can be imposed for unjustified release of data. Past examples include a Local Authority which sent details of a child sex abuse case to the wrong address, and a commercial firm whose employees had an unencrypted computer stolen, loaded with sensitive personal information about 24,000 people.

On the other hand, if we store important data in computers, we know that computers will go wrong. And usually if the data is lost, the business will fail. So we must back up our data. And those back-ups have to be kept somewhere. It is a very real dilemma. The more copies there are of our computer data, the more places it can be stolen from, quite apart from digital attacks. Who do you give the hard drives to, to look after? Will they leave them in a car or train? Lose their briefcase?

And when data is stolen, even if you avoid fines from the ICO, the bigger loss is your customers. They are your livelihood and past evidence suggests, a third of them will walk away from your business immediately when they hear your systems were insecure.

The temptation is to take the view – “it’s too difficult to know what to do about our data, so we will do nothing”. No, I can’t recommend that view.

Last topic – The “right to be forgotten” [RTBF].

Quick recap on last week – If a search engine enquiry of your name gives a link to a website which is, say, the Court report of when you ran on to a football pitch at the age of 16 the last time Huddersfield Town won the league, you may be able to persuade Google, or the ICO or a Court, to order that the link be removed. This on the basis that the link is now unfair to you and to your reputation as a reformed pillar of society, not a hooligan at all these days.

The Court report will still be on the internet, but no-one will be able to find it by searching your name.

Here’s this week’s twist link here. In their article, McGuire Woods explain that the ICO has ordered Google to remove links to reports of someone’s criminal offence, because it is nearly ten years old now. Google did so.

However, this was the first such order issued by the ICO in England and as such, this was legitimate news. News therefore, worthy of Google links if you used a search engine to find out about it. But if you did, then you would find a barrage of news and press comments about it all, many with links to the original ten year old article.

So now the ICO is ordering Google to delete all links to reports of its Order earlier this year, on the basis that if they don’t then the ten year old information will be easily retrievable and not “Forgotten” at all. And look, here I am writing about it. And this very article will be searchable through Google.

How often can the ICO order Google to delete links to its Order to delete links to its earlier Order to delete links to its earlier earlier Order to delete links to its earlier earlier earlier ……….?

If this is an unforeseen consequence of the RTBF, than those who didn’t foresee it were not wearing their glasses. See Streisand effect – link here

In the meantime, if you need Notary Services in Leeds – here we are. Please do contact me or Louise whenever we can assist. As ever, it’s and and phone us on 0113 816 0116