In the end, David Cameron probably felt he had no choice but to publish his tax returns. The questions raised by the Panama Papers leak were not likely to go away until he made every last penny of his personal finances public. In the wake of his decision, other political leaders have followed suit. It may not stop with them.
Labour leader Jeremy Corbyn has suggested that political journalists should make details of their finances available. Financial writers? You can make a case. FTSE chief executives? It's hard to see why they should be exempt. Once you start down this road, it doesn't just affect the prime minister. You might just as well make everyone's tax returns available in one vast online release. In Norway, they already do that. But is that a route we want to go down?
It is very easy to make the argument for more transparency and disclosure for every problem that comes along. If you have nothing to hide, then why would you object to your returns being made publicly available? Company finances are open to everyone who wants to go on to the Companies House website. You can look up what has been paid for any house. Why not just publish everything? There are three good reasons not to.
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First, it may make management more difficult. Chief executives don't usually go around telling everyone exactly what all their colleagues are paid. Does he or she want every regional sales director to know what everyone in finance is making? They might have perfectly valid reasons for not telling them to maintain incentives, or to hire staff on higher salaries who are hard to find without causing resentments elsewhere. There are completely legitimate reasons why salaries are not disclosed to everyone.
Second, won't it lay people open to endless scams, and especially the elderly and vulnerable? True, some returns will be looked at by people who have a genuine and legitimate interest. Many more will simply be scanned by direct marketing companies, and even more seriously by con men, who will use them to compile lists of the affluent and start bombarding them with brochures for stuff they want to sell, or with calls about fraudulent investment schemes.Will the world be a better place by making an 80-year-old with investments a target for high-pressure salesmen?
Finally, and perhaps most worryingly of all, it will surely create space for all kinds of petty grudges and feuds. What happens if someone in the area takes a dislike to you? They can start looking up your returns, and raising all kinds of minor, unpleasant questions, all of which will be stressful and time-consuming to deal with, about whether your return has been filled in correctly. Bullying and trolling on social media has already become a huge problem. Do we really want to create more of it?
It is not as if this data isn't known to the people who actually need it that is, HMRC, the taxman. We send them our tax return, and if anything does not make sense, or if they just want to make some random checks, then they already have ample power to do so. There is a reason we don't encourage vigilantes. The police have the knowledge and experience to know what needs to be done, and they can be held accountable if they get things wrong. The same is true of HMRC. A nation full of tax vigilantes checking everyone's finances will hardly be a pleasant place to live.
And that is before we get into the issue of privacy, which is surely one of the most fundamental rights of all. In fact, people are completely entitled to keep their financial affairs to themselves if they wish to do so. It is probably as important to them as their marriage, their family, their work, or any other major aspect of their lives. We will miss the privacy of the tax return once it is gone.
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Matthew Lynn is a columnist for Bloomberg, and writes weekly commentary syndicated in papers such as the Daily Telegraph, Die Welt, the Sydney Morning Herald, the South China Morning Post and the Miami Herald. He is also an associate editor of Spectator Business, and a regular contributor to The Spectator. Before that, he worked for the business section of the Sunday Times for ten years.
He has written books on finance and financial topics, including Bust: Greece, The Euro and The Sovereign Debt Crisis and The Long Depression: The Slump of 2008 to 2031. Matthew is also the author of the Death Force series of military thrillers and the founder of Lume Books, an independent publisher.
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