FIVE WAYS OUT OF TAX: AN ANALYSIS OF AVOIDANCE DEVICES

Abstract

This paper is about apparent failure in an aspect of financial regulation: non‐compliance with regard to taxation. An idealised compliance model of tax advice, from the Inland Revenue perspective, merely involves application of revenue law to the facts to determine fiscal liabilities. A less compliant approach involves, for example, creative accounting to amend figures and so reduce such liabilities. The focus here, however, is on legal creativity to reduce or even cancel tax bills: just how tax advisers match, mismatch or rematch their clients' facts interactively with malle‐able interpretations of both revenue and other laws. Following classification of various tax devices — with three examples for each of five categories — recurrent concepts, themes and techniques of avoidance are then further analysed. This analysis not only confirms that legal creativity makes compliance problematic but also offers a novel exposition of just how that paradoxical use of the law occurs.

Citation

MANSFIELD, G. (1994), "FIVE WAYS OUT OF TAX: AN ANALYSIS OF AVOIDANCE DEVICES", Journal of Financial Regulation and Compliance, Vol. 2 No. 2, pp. 133-149. https://doi.org/10.1108/eb024801