Question

• Are tax accountants promoting the public interest when they design, promote, and sell tax shelters that reduce or eliminate paying taxes by the wealthiest members of society?

Answer 1

It depends.

1.Professionals having the requisite tax knowledge , help the general public to file their income tax timely and correctly in any economy, as all the tax collected is ultimately used to provide public utilityies so the accountants have an obligation to serve the public interest.

2.So onus comes down to them , that if an individual comes to them for filing of tax return , the tax is failry filed to the governement , This means that the activities of the accountant should promote the general welfare, or at least do no harm to it.

3.There is always a line between tax avoidance and tax evasion , when it comes to tax avoidance it is generally taking advantage of any loopholes in tax laws , which is not illegal but omes down to the intention of the individual or the accountant , whereas tax avoidance is illegal it is like breaking the law and not paying what needs to be paid

4.Then there is tax planning which is investing in various schemes to take deduction
from the taxable income

5.Although both tax planning and tax avoidance are legal ways to reduce tax there is only a thin line of difference among them.In tax palanning a taxayer is doing what the governement wants him to do whereas in tax avoidance a taxpayer is doing something which the governemnt did not expecet a taxpayer to do . The governement through various amendments tries to close down these leaks(loophokes) so that the law is not manipulated

6.Theoretically, a client has the right to minimize tax payable using all legal means to do so – a property right that is considered to be in the public interest although it may not be additive to it.