The Arctic Monkeys in 2006, when they were still just a bunch of likely lads from High Green (Photo via)
In 1973, Cat Stevens earned so much money that he moved to Brazil in order to hang out with his cash on a more long-term basis. Back then, the British Exchequer wanted about 80 percent of Cat’s dough. Cat thought that wasn’t too cool, man. So he picked up his acoustic guitar and his Collected Works of Kahlil Gibran, and boarded a plane bound for Rio, where tax rates were lower, the sun always shone on the Copacabana and the military juntas were always relatively friendly.
He was soon joined by The Rolling Stones and any number of rock bands who didn’t appreciate Britain trying to close its yawning deficits with their money. “Tax exile”, they called it. It's kind of like when your government wants to kill you, so you go into exile. Only your government just want to kill your money.
In 2014, all of that palaver is thankfully so much easier; no one has to accompany their money into exile any more. Now, thanks to modern technology, if you're in the Arctic Monkeys and you have over a million quid that you’d prefer wasn’t taxed, a few clicks of a mouse and it can be sunning itself in Jersey – even if you’ve never been to Jersey in your life. There, your money can do its own thing, living it up with the money of other famous people; Michael Caine, George Michael, Katie Melua. Celebrity money loves to mingle, and thanks to recent whistleblowing on something called the Liberty scheme, we now know that all of those artists' bucks were at the big money party – along with the usual rogues' gallery of businessmen, landowners and Mark Knopfler.
It seems obvious that the The Jimmy Carr Defence is about to be invoked. The kind of defence that goes: "The advisors I spoke to said everything was fine. I didn’t really know what all them little bits of white paper were, guv, honest."
All of which is bullshit, of course; no one gives, as the Arctics did, over a million quid to anyone without getting the 15-minute explanation rather than the elevator pitch. For a million quid it may even be worth hiring a small seminar room and an overhead projector. Consider the alternative: if you ever find yourself saying to someone, “Dude, what exactly did you do with my million quid?” – well, the joke is definitely on you.
Which isn’t to say there isn’t a heavy layer of cosmetic touch-up around schemes like Liberty. No doubt Turner and friends were told the usual things by these advisors, toplined by the credo of their entire industry: “Every citizen has the right to avoid tax, no one has the right to evade tax.” And, no doubt, part of them bought into it. Everyone would like to imagine that all tax is avoided by greedy soulless bankers. Even when you wake up one day and find yourself CEO of a pop group that makes more money than BNP Paribas, it’s hard not to think of yourself as an essentially righteous man, what with your wry eye for foibles that Johnny Banker obviously lacks, reading Mr Nice for the eighth time.
Yet, in every practical sense, once your record deal has enough 0s on the end, you are now incentive-aligned with Johnny Banker. You’re the 0.5 percent. And frankly, after a certain point, you’d rather not pay top whack for other people failing to sort their shit out. Cat Stevens found this out. Mick Jagger found this out. Why should the government lay its hands on a cool half a mill you’ve earned by the sweat of your bandana? That’s harsh, man. Tax hurts. And lots of tax hurts lots more because you see absolutely nothing back for it.
When you’re earning £20,000 a year, the government is subsidising you – your taxes barely pay for enough army and police to keep people from beating you to a pulp under Hobbesian survival of the fittest. But when you're earning £200,000, you’re paying for a lot of other people’s cops and medical bills and mobility scooters and EMAs. That is supposed to be the point. Everyone accepts that part of the social contract, but most people sense that this rests on the underlying assumption that the odds are against you rising far enough to have to pay serious money. So it all feels like a one-way bet when you’re small and struggling.
The fact is, if Liberty-style avoidance was extended to every Joe Muggins, there wouldn't be enough left over in the NHS coffers for more than a few cotton swabs and a wooden mercy-club, like the one dad used to kill the rabbits with myxomatosis. Evade-avoid? Seriously, how disingenuous can you get? The point is precisely the avoid-not-evade nature of the thing. The point is that there's a level of tax minimisation that makes a nonsense of the whole purpose of a progressive tax system in the first place.
Despite the fact they evidently believe tax rules that apply to the rest of us needn't apply to High Green lads with quiffs, it’s very likely that the Arctic Monkeys see themselves as left wing. They come from Sheffield. They’re slightly aggy. Therefore: left wing. It’s obvious. And no, it doesn’t matter what they think about Ed Miliband’s energy policies: in modern Britain, "left wing" is shorthand for "a really chill bro, AKA The Underdog", and right wing is shorthand for "a really uptight bro, AKA The Overdog, AKA The Man".
British pop institution and tax-avoider George Michael (Photo via)
But as the Monkeys have shown us, many of our pop stars – if you sat them down and audited their beliefs – would come out much further right than they'd probably like to admit. George Michael – also busted in the Liberty whistleblow – declared during the dying days of John Major that he’d be prepared to pay a 60 percent tax rate if a Labour government came to power. Then he signed up to Liberty in 2008, a scheme that, between 2005 and 2009, saw 1,600 stakeholders invest a reported £1.2 billion. To put that into perspective, the Exchequer reckons that total tax avoidance throughout the UK costs the taxman £5 billion a year.
Katie Melua also thinks of herself as one of the good guys. A nice, soft, clean jazz pixie couldn’t possibly have contradictory desires. As recently as 2012, Katie was praised by Christian Aid as one of their Tax Superheroes when she claimed that she paid nearly 50 percent of her earnings to HMRC. And yet she was one of the names mentioned in the latest Liberty leak.
At least the likes of Michael Caine, whose name was also attached to Liberty, is a long-time Tory donor who's spent years banging the drum for a low-tax Britain. He got a bit carried away with that, true. But then again, the real charges that get you in the end – the charges of hypocrisy – don't wash for him.
The Arctic Monkeys, on the other hand, are finding out the hard way that believing in a high-public service Britain and a low-tax Arctic Monkeys are incompatible aims. You could say that how they now fare in the eyes of the public entirely depends on an old gangland chestnut – whether you prefer the people who tell you they’re fucking you, or the people who don’t tell you they’re fucking you, then fuck you anyway.
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