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@Soleron

Well, how effective the taxation system is (with regards to people avoiding the taxation) isn't a problem of the method, but the Governments who apply it - I agree, greater regulation does need to be put into place.

As for your second point, about people who are on lower wages having a better real income, hasn't this been getting better in some ways over the years? It's become more of a sliding-procedure (ie - you lose your benefits as your income increases), rather than a cut-off point, though, there probably still is some overlap.

Oh, and I personally think that all people should have free access to public transport, but that's for another day.