Throw away the rule book, draft a new one
When it comes to tax, simplicity beats complexity, writes Mark Barnes
Rules! Who needs them? Well, we all need some. But they have to favour the good guys, not just catch the baddies. Rules define the parameters within which society has agreed to behave - they also define the ways that those wishing to break them can operate, cheat and get away with something that is fundamentally wrong but nevertheless legal. Take tax - more effort and expertise is spent on its avoidance than its payment. The more complex the lock, the more expert the lock-picker is required to be. Simplicity beats complexity, and fairness is a prerequisite for sustainability. I think back on the bad old days of the financial rand (and the even worse blocked rand), which was fundamentally flawed, as are all attempts to control the flow of capital, ultimately. Compliance turns into defiance if the rules are against the natural order of things, or if they fly in the face of enduring truth. In business, economic truth rules. In every buy-sell decision there is a measurable outcome. Wher...
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