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Leaders should act in the spirit of the law—not just by its letter

A response to Janan Ganesh

by Tony Yates / April 18, 2016 / Leave a comment
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Peruvian police guard the entrance of the Mossack Fonseca offices during a raid in Lima on April 11, 2016.Peruvian authorities raided a branch of Mossack Fonseca in Lima, which is located directly across the road from the Panamanian embassy. They said they were looking for evidence Peruvians used the firm for tax avoidance Peruvian police guard the entrance of the Mossack Fonseca offices during a raid in Lima on April 11, 2016.Peruvian authorities raided a branch of Mossack Fonseca in Lima, which is located directly across the road from the Panamanian embassy. They said they were looking for evidence Peruvians used the firm for tax avoidance ©NEWZULU/Carlos Garcia Granthon/NEWZULU/PA Images

Police guard the entrance of the Mossack Fonseca offices in Peru during a raid in Lima, the country’s capital, on 11th April, 2016. Apparently while their colleagues looked for evidence that Peruvians used the firm as a means of avoiding tax ©NEWZULU/Carlos Garcia Granthon/NEWZULU/PA Images

Read more: Should all MPs publish their tax returns? 

The media is stuffed with argument and outrage about the Panama Papers. Many people are trying to ascertain the new things we know and don’t know about our tax law and the tax affairs of David Cameron’s Father. We have been plunged into a national debate about the ethical standards to which our leaders should adhere; and what should inform the tax code.

Janan Ganesh touched on key parts of the debate in his recent column for the Financial Times. One such part is the idea that some of our tax law is unfair. Another is that the debate has been partly about the fact that life is unfair, since some people are rich, and others become rich by inheriting. Finally, there is outrage that our politicians might not be playing fair, using the letter of the tax law to their own advantage, just like the rest of us could.

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Tony Yates
Tony Yates is a Professor of Economics at Birmingham University

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