Saturday, 4 December 2010

Top Shop: Tax evasion or rent seeking?

Topshop London store closed by tax protestors

Should the protesters really be demanding the end of Philip Green's unearned incomes before his tax evasion?

We can see that the bigger the corporation, the more easily it can purchase capital. Because it can buy that capital, more cheaply using unearned incomes from its land rents.

Real Reform: How Does Capital Concentrate Into Huge Corporate Fortunes?

And the more the corporation is a rent seeker the higher the earnings of its top execs. Their job is to GET LAND! Not produce wealth.

Real Reform: What is the Central Cause of High Pay Differentials?

So taxing Mr Green's earnings long after he has ferreted them away in a tax haven is not the best way surely.

Real Reform: Philip Green is a rentier before he is a tax evader

Why not tax these rents at source. And get 100% of them. By taxing the land rent. Its cheaper to collect, has a bigger revenue base and allows the real entrepreneur to come forth under free conditions.

Curing root cause. Rather than treating symptoms.