The tax advisor's moral dilemma
The slogan of the Dutch Internal Revenue Service, “Leuker kunnen we het niet maken, wel makkelijker,” roughly translates as “We can’t make it more fun, but we can make it easier.” Each year the blue envelope on our doormat reminds us that we have to pay our taxes. Together we thus provide the Dutch State with the necessary financial means. The monetary amounts involved are so high that the system is referred to as the fiscal economy. Sevket Kocakaya is about to graduate with a Master’s degree in this field. I asked him how his future work in Fiscal Economics relates to the Tilburg Educational profile, resting on the pillars of knowledge, skills and character.
by Jens Thomaes
About Sevket Kocakaya
Sevket is studying for a Master’s in Fiscal Economics and currently working at a small tax consultancy agency in Nijmegen, where he assists his colleagues in the areas of transfer pricing and corporate taxes. In addition, he writes blogs on recent developments in corporate tax, such as the implementation of the Anti- Tax Avoidance Directive.
How do you feel about the Tilburg Educational Profile: knowledge, skills, character?
“We obviously cannot do without knowledge and skills. These are basic requirements if you want to learn a trade, become a professional in your field, and do your job well later on. I do notice, however, that character is becoming more and more important in our society, also within tax law. That is why I think the educational profile has an important role to play in education at this university. It is nice to see, for instance, that there are classes in our program dealing with societal cases like tax planning engaged in by big multinational corporations.”
Tax planning
Companies (billion-dollar companies in particular) use tax planning to prevent them from having to pay huge amounts of tax money to the state. It enables wealthy parties to pay only a few percent in taxes, while employees often pay high tax rates. Due to international tax constructions, letterbox companies, and clever use of loopholes in the law, national revenue services miss out on billions of dollars.
The role of tax advisors
“Obviously, tax planning is fraught with ethical dilemmas. As a future tax advisor, I may have to deal with these, and that is no simple matter. On the one hand, tax advisors are supposed to offer their clients the services they ask for; on the other, I feel they are also bound by a social responsibility not to cross certain moral boundaries. Sometimes it is very hard to determine where precisely these boundaries lie. Besides this, the issue is also legally anchored in a vast number of tax laws.”
Reflection and striking a balance
“Dealing as it does with content-based moral issues makes the educational program a lot more stimulating. It is not always easy, however, to decide on the best way to go about this. One of the ways of dealing with moral issues that is currently employed in the program is to present ethical problems to students in the form of a quiz.
I think it is also important to reflect on what you are okay with in your work. We must not underestimate the seriousness of feelings of guilt or issues of conscience. Tax advice you provide should not keep you awake at night. Thinking about possible improvements, I believe that legislation and administrative leadership are of decisive importance.
“We are confronted with severe challenges, also in the civil service sector, such as the recent exodus of experienced tax officers, and the cumbersome tax reforms needed for instance to combat the phenomenon of aggressive tax planning.”
What else plays a role in all this?
Sevket hastens to add that there are other factors currently playing a role in our society that also influence our societal and moral awareness. One of the elements he mentions is the considerable loan debts incurred by students these days. “These debts can amount to as much as tens of thousands of euros.” The growing individualization also plays an important role. “Personally, I think it is understandable that graduates will opt for a job that pays well. If you want to (be able to) support a family and have to pay off your student debt, it is not surprising if you give precedence to the level of salary over the societal impact of the job.”
“We are seeing that people are getting more and more individual and competitive in relation to their fellow men and women. This trend runs counter to the sense of community and is at odds with the university’s objective to yield students of character, looking out not just for themselves but also for other people’s wants and needs. Universities have a duty to educate students in such a way that that they will want to make the world more social and more sustainable. Our generation should take the lead in this."