At a Downing Street reception I asked chancellor Gordon Brown about Adam Smith’s principles of taxation. There are four of them: people should contribute in proportion to their abilities; taxes should be transparent; payment should be convenient; and taxes should be ones that are cheap to collect, without needing huge armies of collectors or inspectors, encouraging smuggling or burdening enterprise. “None of my budgets have followed Adam Smith’s principles,” Gordon told me, “except perhaps one where I had a copy of the Wealth of Nations at the dispatch box. Who knows? Maybe it was my best.”

Madsen Pirie writing in the The Daily Telegraph this week points out the really serious problem with the UK’s tax system:

According to the Taxpayers Alliance, the UK’s tax code is now the longest in the world. At 9,973 pages it is equivalent to seven unabridged editions of War and Peace. It contrasts with the 1,700 pages of Germany’s tax code.

The costs of this are real. KPMG puts the administrative burden of the UK’s tax regulation at £5.1bn a year.

Ouch. In truth, the UK’s tax code is a complete shambles and completely gutting. One place to start would be by copying the Flat Tax being implemented elsewhere in parts of the European Union which would massively simplify the system, increase growth and deliver greater tax revenues, too.