One of the causes of the present crisis in the eurozone has been the failure of European government to collect all taxes levied on citizens and companies.

In Greece, Italy and Spain, tax avoidance became notorious. Rich Greek shipowners managed their businesses to minimize taxes. Foreign tax havens welcomed the rich with open arms and red carpets. Clever accountants and lawyers thought up ever more convoluted schemes enabling the wealthy and the not-so-wealthy to avoid paying taxes at specified rates.

In Spain it was said that it was normal practice for the purchaser of a house to pay a proportion in cash that was not declared and thus not subject to tax. The black economy, where services are provided in return for cash, which is not declared on tax returns and avoids value-added tax, has spiraled, while governments’ budgetary deficits have grown. In some European countries, the taxpayer and the tax authorities negotiated the tax to be paid.

British politicians, so often keen to criticize Europeans, have until recently tried to claim that things in Britain were different and that, on the whole, the British public paid their due taxes on the principle that, as Prime Minister Cameron has reiterated so often, we are all in austerity together.

But tax avoidance, which is legal, and tax evasion, which is not, has not been confined to the countries of Southern Europe. It has recently been revealed by investigative journalists that tax avoidance has been rife in Britain. One headline in a reputable financial newspaper reads, “The irresistible rise of the repugnant tax dodger.” The article asserted that “tax avoidance has become routine among Britain’s moguls, stars and footballers.”

One comedian has been exposed as sheltering £3.3 million in a scheme based on the Channel Island of Jersey, a notorious tax haven. Civil servants are among those who have taken advantage of a loophole under which they set up a company to receive their salary and then pay them a dividend is subject to a lower tax rate.

An even more egregious device is one whereby an individual borrows from the company what he needs to live on, knowing that the loans will never be called in and that the sums he receives as loans are not subject to tax. One of those exposed in the press for using these schemes has said, “I pay what I have to and not a penny more.”

The Revenue office has tried to shut down such devices when they learn of them and have had some success. But the accountants and lawyers who set up these schemes in what has become an industry are well paid and canny; they generally stay one or more moves ahead of Revenue.

Another arrangement that has existed for years and enables the super-rich to minimize the taxes they pay is “nondomicile status” — being resident abroad in a low-tax haven like Monaco.

One notorious case is that of the retailer Sir Philip Green, who avoids paying large sums in taxes by ensuring that the huge earnings from his retail empire are not subject to high U.K. rates. Instead, the earnings go to his wife who resides in Monaco where rates are very low.

The defenders of this iniquitous system argue that its existence tempts foreigners to invest in Britain. That’s one reason why property prices in London are so exorbitant and why many of these properties are unoccupied for much of the year.

It has been estimated that the amount of tax revenue lost via these schemes is such that, if it could all be collected, the basic tax rate could be reduced by 2 percent. This has led to a public outcry, and politicians have condemned tax avoidance as immoral.

In the past, those who found legal ways of avoiding tax were regarded simply as clever. The climate of opinion has hardened. The Revenue office, which has often seemed lax in its dealings with large companies, will need to improve performance significantly. Morale among officers is low as they are expected to do more while their numbers are being cut.

Another shock to British complacency came the last week of June when the four main British banks were accused of misleading small businesses into paying for protection against changes in interest rates.

Royal Bank of Scotland, meanwhile, suffered a computer glitch that seriously affected payments to and from customers’ accounts for the best part of a week.

Worst of all for the bankers, whose reputation is at an all-time low, was the revelation that Barclays and other banks had been involved in scams to set the Libor (London interbank offer rate). Traders at Barclays and other banks are said to have worked together to fix the rate and to provide false information. This led to Barclays having to pay a fine of £270 million to U.S. and British authorities.

Bob Diamond, the chief executive of Barclays, who has been paid many millions in salary and bonuses over the years, made remarks last year to the effect that honesty and integrity were part of the culture of Barclays. Not surprisingly he has been accused of hypocrisy. If he did not know what was going on at his bank, he was guilty of incompetence. If he did know, he had connived at wrongdoing. Diamond resigned from his post Tuesday.

The consensus in Britain is that those responsible for breaking the rules should face criminal prosecution.

Some dubious practices, such as insider information leaks, have recently been revealed as having taken place at Nomura Securities. That’s not new, and it is no consolation to learn that British banks are not alone in ripping off their customers.

Greed is what makes the rich and the not-so-rich fiddle their tax liabilities. It also inspires bankers to evolve ever more complex schemes to make money.

Hugh Cortazzi served as Britain’s ambassador to Japan from 1980 to 1984.

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