Dr Michael Blackwell

This course is available on the BA in Anthropology and Law and LLB in Laws. This course is available as an outside option to students on other programmes where regulations permit and to General Course students.

This course is capped at 20 students.

Taxation is a topic that has throughout history pervaded political debate and is encountered in every area of life. Taxation was one of the very first subjects to be taught at LSE. The teaching of tax law as an academic subject started at LSE, where it was introduced by Professor GSA Wheatcroft in 1957.

On the LSE Taxation course legal issues are of vital importance, but are placed in their economic and social context. This makes it easier to understand the purpose of the legislation, the reason for the problems encountered and why difficulties remain. So this taxation course suitable for a wide range of students – not just those interested in commercial law. The substantive law element of the course is UK based, but the issues that arise are ones that all jurisdictions have to face.

Students taking this course should be prepared to use a variety of sources ranging from statute and case law to literature on public policy. The precise balance of materials used varies from topic to topic. All the readings set will be accessible and non-mathematical. NO COMPUTATION is required and no knowledge of any discipline other than law is required. The course is open to second and third year law students, and experience suggests that it is equally suitable for both years.

By taking this course you should develop the following skills and attributes (i) working with and analysing legislation; (ii) working with and analysing case law; (iii) research skills; (iv) communication skills; (v) professionalism.

The syllabus is set out below, although there is some variation of topics selected from year to year, depending on the focus of current debate, and in the order of topics. The course starts with an examination of the objectives of a tax system. What is meant by a ‘good’ or ‘fair’ tax? The course examines how employees and the self-employed are taxed and the differences between them, the taxation of business profits, how this is influenced by accounting developments and the ways in which we can tax companies and capital. We also study tax avoidance – how is this distinguished from evasion and is there a distinction between unacceptable tax avoidance and legitimate tax planning? Other issues that are likely to be covered are taxation of corporate finance, the impact of EU membership on direct taxation, international taxation, and constitutional issues relating to the use of ‘discretion’ by the Inland Revenue.

Syllabus Topics

1. General principles of taxation, objectives of a tax system, types of taxation, capital and revenue. Structure and administration; powers of HM Revenue and Customs. Outline of the UK tax system. Taxation of the individual: rates, allowances and treatment of the family, national insurance contributions.

2. Employment income – taxation of salaries, wages and other remuneration of employees and officers.

3. Business income (trading income) – taxation of business profits, income taxation of unincorporated businesses.

4. Tax treatment of capital – capital gains tax; other taxes on capital and on income from capital – objectives and effectiveness.

5. International taxation – the tax base, tax residence and domicile, double-tax relief, tax treaties and the consequences of British membership of the EU for UK tax.

6. Corporations – legal forms for carrying on a business, reasons for taxing corporations, corporation tax, integration with taxation of individuals, distributions to shareholders, taxation of groups of related companies. 

7 Statutory interpretation and tax avoidance – application and interpretation of tax legislation by the courts; tax evasion and tax avoidance and methods of controlling these activities.

30 hours of seminars in the MT. 30 hours of seminars in the LT. 6 hours of seminars in the ST.

Students will be expected to produce 2 essays in the MT and LT.

Introductory reading:

J. Tiley and G. Loutzenhiser, Revenue Law (Hart, 7th ed, 2012), Chapters 1-5

M. C. Blackwell ‘Variation in the Outcomes of Tax Appeals Between Special Commissioners: An Empirical Study’ [2013] British Tax Review 154

The principal book for the course is expected to be Lee, Revenue Law Principles and Practice (Bloombury Professional, 33rd ed, 2015). Tiley, Revenue Law (Hart Publishing) will also be referred to. These texts are supplemented by the other readings that will be set. The cases and readings are readily available electronically or in the LSE library. Vouchers are available for students on the course to purchase of published copies of the tax legislation at a substantial discount. N.B.: most tax law textbooks are revised extensively on an annual basis, so do not buy an old one!

Exam (100%, duration: 3 hours, reading time: 15 minutes) in the main exam period.

Selected 'Legislation' may be taken into the examination, with non-verbal markings only.