Many of you have emailed me over the last few weeks calling for me to support a ‘Tax Dodging Bill,’ so I wanted to explain my views and outline how a Labour Government’s first Finance Bill will act to tackle tax avoidance.
I am very concerned with the huge amount of money that big companies avoid paying in taxes. This is not just a problem here in the UK but across the world. Countries are losing billions each year and the impact of globalisation has made it ever more difficult to pin down dodgers.
The UK tax code is very extensive and technical. The loopholes which companies exploit are technically legal and when Parliament attempts to close loopholes, very often another one opens. The biggest frustration I have is that despite their legality, they are so blatantly immoral and undermine the wishes of Parliament and the public.
In February we saw Panorama uncover that HSBC were helping wealthy clients across the world to evade millions of pounds of taxes. And the Conservatives lethargic response shows you can’t trust the party of the rich to crack down on tax evasion.
Labour have a 10 point plan to tackle tax avoidance.
A Labour government would launch a massive and immediate crackdown on tax avoidance, aimed at cutting it by at least £7.5 billion by the middle of the next parliament.
· Introduce penalties for those who are caught by the General Anti-Abuse Rule
· Close loopholes used by hedge funds to avoid stamp duty
· Close loopholes like the Eurobonds loophole which allow some large companies to move profits out of the UK and avoid Corporation Tax
· Stop umbrella companies exploiting tax reliefs
· Scrapping the “Shares for Rights” scheme, which the OBR has warned could enable avoidance and cost £1bn and is administered by HMRC, and so ensure HMRC can better focus on tackling tax avoidance
· Tackle disguised self-employment by introducing strict deeming criteria
· Tackle the use of dormant companies to avoid tax by requiring them to report more frequently
· Ensuring stronger independent scrutiny of the tax system, including reliefs, and the government’s efforts to tackle tax avoidance
· Ensure the UK’s Overseas Territories and Crown Dependencies to produce publicly available registries of beneficial ownership
· Making country-by-country reporting information publicly available
· Ensuring developing countries are properly engaged in the drawing up of global tax rule
There is a clear choice to make at this election on tax evasion. Labour will increase transparency, toughen penalties and abolish non-dom rules. The Conservatives have spent the last few weeks defending the nom-dom loophole.
If you agree with Labour’s clear priorities for fighting tax avoidance, vote for me as your Labour MP and help elect a Labour Government on May 7.
