The cautionary tale of the 79-year-old tax dodger

How much of George Osborne's pledge to cut tax evasion is chest-thumping?

UK chancellor George Osborne has unveiled a budget full of detail on government plans to crack down on tax evasion. The UK government has been banging its drum for some time on the topic, but now it’s released some firm detail on what it intends to do, and in particular its offshore strategy. The question is how much of this is chest-thumping and what will it actually mean?

Here, like in many other areas, it’s useful to see what the US is doing and it’s clear that the UK has taken its lead from across the Pond. The US has had significant success putting the fear into US citizens with assets abroad. The US Internal Revenue Service has netted more than $5bn in back taxes, interest and penalties since 2009. This included the conviction of a 79-year-old former offshore account holder, Mary Estelle Curran, who was fined $21m having failed to report tax of $667,716 on her undeclared offshore accounts (although the accounts did hold $41m so she wasn’t left destitute by the fine!). The HMRC has outlined plans to use similar name and shame tactics to get the desired result.

The message the government and HMRC are trying to send is clear: the government is doing its worst to be a big bad monster and force tax-dodgers to quake in their boots and fess up. The government says it will ‘name and shame’ not only avoiders, but those who help them all – or as David Cameron referred to them in Davos earlier this year: “the travelling caravan of lawyers, accountants and financial gurus”. The aim is to bring in an extra £4.6bn in taxes over the next five years and the tax exchange agreements recently agreed with Jersey, Guernsey and the Isle of Man are expected to bring in more than £1bn of that over the same period.

This seems like a modest amount, and it would be entirely realistic to see this figure edge higher. According to global wealth consultancy WealthInsight the amount of offshore funds held in the UK and Channel Islands by local clients’ stands at about £515bn. Osborne’s figure of £1bn is, therefore, a tiny drop in this ocean of offshore money.

However it’s important to remember that this kind of rhetoric about tax dodgers is not new. Governments have been talking about it for the past seven years, although it’s only now that the regulatory machinery has caught up. There’s little doubt the smart money has already moved to become transparent – those caught in the coming years are likely to be those without Cameron’s ‘caravan’ of sophisticated advisers.

Still it’s important not to underestimate to what lengths the tax authorities will go to claw back revenue. Since 2010 the HMRC has spent £1bn on tax gathering including employing an extra 2,500 staff by 2014-15. And the HMRC is not just targeting high flyers; it recently released a list of evaders who had avoided £25,000 or more. The writing is on the wall. The government coffers need any penny they can scrape together and the HMRC is set to go to what may seem like extreme lengths to claw back all it can get from its taxpayers, at home and abroad.

George Osborne. Photograph: Getty Images
Getty Images
Show Hide image

Is there such a thing as responsible betting?

Punters are encouraged to bet responsibly. What a laugh that is. It’s like encouraging drunks to get drunk responsibly, to crash our cars responsibly, murder each other responsibly.

I try not to watch the commercials between matches, or the studio discussions, or anything really, before or after, except for the match itself. And yet there is one person I never manage to escape properly – Ray Winstone. His cracked face, his mesmerising voice, his endlessly repeated spiel follow me across the room as I escape for the lav, the kitchen, the drinks cupboard.

I’m not sure which betting company he is shouting about, there are just so many of them, offering incredible odds and supposedly free bets. In the past six years, since the laws changed, TV betting adverts have increased by 600 per cent, all offering amazingly simple ways to lose money with just one tap on a smartphone.

The one I hate is the ad for BetVictor. The man who has been fronting it, appearing at windows or on roofs, who I assume is Victor, is just so slimy and horrible.

Betting firms are the ultimate football parasites, second in wealth only to kit manufacturers. They have perfected the capitalist’s art of using OPM (Other People’s Money). They’re not directly involved in football – say, in training or managing – yet they make millions off the back of its popularity. Many of the firms are based offshore in Gibraltar.

Football betting is not new. In the Fifties, my job every week at five o’clock was to sit beside my father’s bed, where he lay paralysed with MS, and write down the football results as they were read out on Sports Report. I had not to breathe, make silly remarks or guess the score. By the inflection in the announcer’s voice you could tell if it was an away win.

Earlier in the week I had filled in his Treble Chance on the Littlewoods pools. The “treble” part was because you had three chances: three points if the game you picked was a score draw, two for a goalless draw and one point for a home or away win. You chose eight games and had to reach 24 points, or as near as possible, then you were in the money.

“Not a damn sausage,” my father would say every week, once I’d marked and handed him back his predictions. He never did win a sausage.

Football pools began in the 1920s, the main ones being Littlewoods and Vernons, both based in Liverpool. They gave employment to thousands of bright young women who checked the results and sang in company choirs in their spare time. Each firm spent millions on advertising. In 1935, Littlewoods flew an aeroplane over London with a banner saying: Littlewoods Above All!

Postwar, they blossomed again, taking in £50m a year. The nation stopped at five on a Saturday to hear the scores, whether they were interested in football or not, hoping to get rich. BBC Sports Report began in 1948 with John Webster reading the results. James Alexander Gordon took over in 1974 – a voice soon familiar throughout the land.

These past few decades, football pools have been left behind, old-fashioned, low-tech, replaced by online betting using smartphones. The betting industry has totally rebooted itself. You can bet while the match is still on, trying to predict who will get the next goal, the next corner, the next throw-in. I made the last one up, but in theory you can bet instantly, on anything, at any time.

The soft sell is interesting. With the old football pools, we knew it was a remote flutter, hoping to make some money. Today the ads imply that betting on football somehow enhances the experience, adds to the enjoyment, involves you in the game itself, hence they show lads all together, drinking and laughing and putting on bets.

At the same time, punters are encouraged to do it responsibly. What a laugh that is. It’s like encouraging drunks to get drunk responsibly, to crash our cars responsibly, murder each other responsibly. Responsibly and respect are now two of the most meaningless words in the football language. People have been gambling, in some form, since the beginning, watching two raindrops drip down inside the cave, lying around in Roman bathhouses playing games. All they’ve done is to change the technology. You have to respect that.

Hunter Davies is a journalist, broadcaster and profilic author perhaps best known for writing about the Beatles. He is an ardent Tottenham fan and writes a regular column on football for the New Statesman.

This article first appeared in the 05 February 2015 issue of the New Statesman, Putin's war