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No Justice

We often call our system of law the “justice system” but I specifically avoid using that description because justice often seems to have very little to do with the actual practice of law.

I know that the word “justice” can mean a system used to administer the law but the more common meaning, and the one most people first think of, involves words like these synonyms: fairness, justness, fair play, fair-mindedness, equity, evenhandedness, impartiality, objectivity, neutrality, disinterestedness, honesty, righteousness, morals, and morality.

So what is all of this leading to? Well obviously I have discovered another situation where our system of laws isn’t fair, and the reason it isn’t fair seems to relate mainly to politics.

I recently heard an interview with an associate professor of law who compared the exercise of the law in relation to tax evasion and welfare fraud. Both of these transgressions (or crimes, or misdeeds, or whatever else you want to call them) are purely financial in nature, there are no direct victims (although the government or taxpayer could be seen as a victim), and they produce the same outcome: less money available for government spending.

Before I go any further I should say that tax evasion is the illegal failure to pay taxes and this should not be confused with tax avoidance which is avoiding paying tax through legal means. But I think in many cases avoidance, even though it is legal, is worse than evasion. Huge corporations paying almost no tax is pretty morally reprehensible in my opinion, even if it isn’t technically illegal.

But to continue with the main point, let’s look at the size of the problem. In New Zealand the government loses about a billion dollars from tax evasion every year, and the estimate of hidden activities is over 5 billion. So how much is lost to benefit fraud? That would be 20 to 30 million. That seems fairly trivial in comparison.

The tax problem is over a hundred times worse than the benefit one so you would expect efforts at control, prosecutions, and penalties to be correspondingly high. But no, 700 welfare benefit cheats are prosecuted each year, compared with 50 tax evaders. And even though the average value of a tax fraud case is $287,000 only 20% go to prison compared with welfare fraud, where the most serious case involved $67,000 but where there was a 60% chance of prison as a penalty.

To make matters worse restitution for tax fraud in 176 cases showed just 18 repaid in full and 13 partly paid, but in the case of welfare fraud, practically every case was fully pursued.

Remember that most people are on welfare just to survive and many might be forced into bending the rules just to try to give their family a slightly better life, but in the case of most tax fraud just plain greed is the motivating factor.

It seems like a simple case of one law for the rich and another for the poor but there are some extenuating circumstances. The government has put a bit more effort into stopping tax evasion, but even then it is not as much extra effort as they have put into stopping benefit fraud. I think it is fair that Inland Revenue should try to help possible offenders to correct and repay their debts but why not offer the same flexibility to those guilty of benefit fraud?

There is a simple explanation here. Our right-wing governments and their supporters like to be seen as being tough on benefit fraud even though it hardly even matters in the big picture. And those same people are often sympathetic to those who avoid paying tax even when their actions are illegal. And yes, these are the same people who want to get “tough on crime”. Right-wing nutters aren’t exactly known for their tolerance or their consistency I guess!

But whatever the motivations for this inconsistency I think one conclusion is obvious: we really don’t have a justice system, just a legal system designed to be anything but fair. There really is no justice.

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  1. September 9, 2014 at 3:13 pm

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