Benefits cheats vs tax dodgers: who's worse?

Michelle McGagh
Taxes evasion
Taxes evasion

The country is divided in two when it comes to who's more of a scourge on society; tax dodgers or benefits cheat. But would they think differently if they knew the figures?

We're currently dealing with the HSBC furore, politicians justifying tax avoidance and even Ed Miliband's inheritance arrangement. On top of this we've got endless stories of tax cheats and free boob jobs being handed out by the NHS – it seems everyone wants to take the honest, hard-working taxpayer for a ride.

It's no surprise that people are feeling disgruntled, but who they are disgruntled with is a surprise.

In an ICM poll commissioned by the Guardian, people were asked whether tax dodgers should be treated more harshly than benefits cheats. Those polled were almost exactly split down the middle; 52% agreed that tax dodgers should be treated more harshly than those scamming the welfare state.

Of course, we have to put this into context. Avoiding tax, or tax dodging, is not illegal – only tax evasion is – whereas fraudulently taking benefit from the state that you're not entitled to is illegal.

In that case I can see why half of people think that benefits cheats are worse than people using complex tax avoidance schemes to shelter their cash from the taxman.

Financial context

However, putting it into a financial context pushes the conversation further. A total of £1.2 billion is lost each year to benefit fraud. While I am not saying that is a small number, and that the money wouldn't be put to better use elsewhere, the number is dwarfed by the amount of revenue lost to tax avoidance.

According to estimates, because you can never be sure, the 'tax gap' – the difference between what is owed to the taxman and what is paid – totals £120 billion – or 100 times the benefit fraud losses.

Politicians have a preoccupation with benefit cheats (not to mention the cutting of support for the most vulnerable) but less of a light is shined on those who are taking advantage of clever tax wheezes to avoid stumping up their fair share of cash. A more cynical person may suggest that it's because they, their friends, peers and political parties benefit hugely from these arrangements and to stamp them out would be detrimental to those involved.

But if we're going to crack down on the benefits cheats then let's also crack down on those who have the means to skirt the rules.

Read more:
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