UK to confiscate paychecks in private sector?
posted at 2:20 pm on September 20, 2010 by Ed Morrissey
Well, if Donald Berwick’s favorite health-care system is to survive, the Brits have to do something, don’t they? The British government’s tax agency has proposed a new process for employers in the private and public sectors to pay their workers. Instead of actually giving the money to the employees, they’ll pay Her Majesty’s Revenue and Customs, which will then decide just how much to allow the workers to keep:
The UK’s tax collection agency is putting forth a proposal that all employers send employee paychecks to the government, after which the government would deduct what it deems as the appropriate tax and pay the employees by bank transfer.
The proposal by Her Majesty’s Revenue and Customs (HMRC) stresses the need for employers to provide real-time information to the government so that it can monitor all payments and make a better assessment of whether the correct tax is being paid.
Currently employers withhold tax and pay the government, providing information at the end of the year, a system know as Pay as You Earn (PAYE). There is no option for those employees to refuse withholding and individually file a tax return at the end of the year.
If the real-time information plan works, it further proposes that employers hand over employee salaries to the government first.
What could go wrong? Well … plenty, actually. I’ve worked as a midlevel manager at firms that use direct deposit for pay (which I use myself), and I’ve seen mistakes made. One employee got paid $14,000 for one two-week period, which the company had to claw back. The next fortnight, he got 56 cents in his direct deposit, which took two days to correct. Now imagine having to deal with a government bureaucracy when these mistakes get made, and one can imagine the disasters that await. Plus, thanks to this process, the government will have access to everyone’s bank accounts, too. Goody!
But the problems are more than just pragmatic. This is a symptom of tyranny, where the government takes the attitude that it owns everything and has the responsibility for redistributing wealth as it sees fit. If the UK proceeds down this path, there will be no more private sector; everything will become an arm of the government.
I realize that the Boston Tea Party has much different historical implications for the British than it does for Americans, but perhaps it’s Tea Time in the UK, too.