Labour has launched a new consultation on tax as part of its Stability and Prosperity Policy Commission process. In its call for submissions it says:
The Government's economic failure means a Labour Government in 2015 is likely to inherit a deficit and tackling tax evasion and avoidance will be extremely important. When we are facing tough choices and people across the country are struggling with the cost of living, all savings are important.
Every £1 million raised by tackling tax avoidance and evasion is the equivalent of the salaries for 50 newly qualified teachers. Yet when it comes to closing the tax gap, deep cuts to HMRC mean it is being asked to do much more with much less.
We want to know how best we can:
- Ensure individuals and businesses pay the tax they owe
- Lead the way in tackling tax avoidance and evasion via the havens
In the interests of full disclosure I should mention I will be taking part in this process as I am working with Unite on their submission.
But the more the merrier. Get writing...
The more detailed call for submissions is here.
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Considering it was Labour who was last in power and probably introduced a lot of these laws that allow tax evasion I for one wouldn’t believe any manifesto promise that you’ll change laws to stop tax evasion.
What Blair and Brown did to this country was unforgiveable – especially introducing ATOS, a French company (?), to do your dirty work and to deliberately stop genuinely sick and disabled people from continuing to get benefits to allow them to live in almost poverty. I would never vote for your party again after what you have done.
As for Brown’s selling off the gold reserves when gold was at an all time low – well that just adds fuel to the fire.
You are now equal to the conservatives in my eyes and I’ve never voted for them.
That’s slightly bizarre: Labour did introduce more anti-avoidance and evasion law than any other government, ever
But ATOS was a mistake
I don’t defend it. I don’t have to. I was not a member of Labour then. And actually am not now either, although a lot of people assume I am. But I don’t deny I advise them. As I have also advised other parties in my time.
I am particularly concerned about Amazon’s non-payment of tax. I am locked in twice over to buying books through Amazon: I was an ‘early adopter’of e-book readers so have a Kindle, and I enjoy audio-books so use Audible (wholly owned by Amazon). Amazon’s ventures of this kind are wonderfully inventive, but in the end they work against competition and choice. I feel trapped, and I resent the fact that my reading/listening comes from a company which avoids the fair taxation that should pay for my – and everyone else’s – roads, health, pension etc. I used to be active in the Labour Party, I left because of (among other things) the Iraq War, and I would be greatly heartened if Labour could establish strong policies against tax evasion of the Amazon kind.
My wish too
The Labour Party would need to reverse the stance on this issue:
http://www.guardian.co.uk/commentisfree/2012/nov/22/scheme-trillions-tax-havens-scuppered
The Labour party argued against this deal during Finance Bill debates
Coporate tax avoidance – this will eventually be the destruction of companies like John Lewis who DO pay their dues.If companies paid up the poor would not be persecuted as they are now.
I cannot hear any voice in defence of the poor and disabled and those with children being REPRESENTED AND DEFENDED BY THE LABOUR LEADERSHIP IT IS A DISGRACE – IF I NEVER HEAR OR SEE BLAIR AGAIN IT WILL BE A BLESSING.
HAS ED BALLS GOT THE BALLS TO STAND UP FOR THESE PEOPLE?
Unfortunately Linda, Ed Balls appears to be silent on corporate tax avoidance and so many other issues. He really is a liability for the Labour Party because the accusation can be made’ why did you allow this to happen?. The Labour Party does not seem to realise that many people are really annoyed. I was having coffee in Cafe Nero this morning (perhaps I should have gone elsewhere but I like their coffee and Portugese custard tart) and some members of staff were telling me that people have been going into the shop and complaining about the low corporation tax being paid by the company and stating that they will not return. I understand that the CEO of Sainsbury’s has now joined some of his fellow CEOs in expressing concern about the tax payments of multinational companies operating in the UK. At least I can breathe a sigh of relief in the knowledge that my grocery shopping at Waitrose and Sainsbury’s is not compromised by tax considerations (hopefully).
The tax system should be reformed so as to discourage the speculative hoarding of land – especially underused or empty sites in, or on the fringes of, urban areas. (eg Battersea Power Station). Most of the excessive wealth in minority hands is acquired in this way.
Two simple changes would prevent this happening;
(i) Putting Uniform Business Rates onto a site value basis (with sites valued according to best permitted use).
(ii) Adopting a similar ‘site-value’ reform for residential property (with transitional reliefs to avoid hardship to cash poor owners of valuable homes).
Site taxing prevents the wealthy hiding their assets in tax havens, and discourages them from making speculative gains in land value at the expense of everyone else. It would reduce the unequal distribution of wealth, and revive the economy by reducing land prices.
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The overcomplication of corporation / business tax and all these loop holes means ‘legal’ avoidance is possible.
Simplify it all – just put a ?10%? tax on all businesses turn-over (NOT profits) – this would be fair on small businesses because they would not be penalised for creating profit and it would mean big businesses / corporations could be taxed in one straight forward, non-avoidable way – if they take revenue, they have turnover *simples*
Also – whilst on the subject – how about making it impossible for all the massively rich and highly paid people who avoid their income tax to do so? Again, close the loop holes, make all work payment count towards tax, make residency ‘elsewhere’ harder to justify and then set tax at sensible levels to not encourage those who do earn a lot to try to ‘avoid’ paying.
Over complication of tax (and enegry prices? and many other things) would almost seem to create loop holes for those who can afford to find them… Simplify it all, make it understandable for all, make it applicable to all.
Sorry
That’s VAT by another name
Deeply regressive
in your view – but everyone understands VAT and it gets paid, because there are few loop holes. You may not like it, you may see it as ‘regressive’ but it is effective
It also has one of the highest tax gaps – because it is so heavily evaded
Which is a sure sign your claim is simply wrong
There’s one simple way to avoid VAT and that is to stop trading when the threshold is reached. Many businesses close for the summer in resorts, which is not to the benefit of locals.
I’m a University based researcher and have just spun-out a nanotechnology company and would like to offer Labour these thoughts on how tax havens actively prevent the exploitation of innovation
There is an misinformed view that tax competition promotes innovation and startup activity. for example, see the discussion in a recent Observer discussion where Jeff Jarvis argues that the act of forcing companies to pay the intended current corporate tax rate risks….
“disadvantaging the UK by making it a hostile environment for investment by both startups and innovative international companies.”
http://www.guardian.co.uk/commentisfree/2012/nov/17/should-boycott-google-starbucks-amazon
However the point Jeff makes misses a bigger issue. Multinational companies such as GE used to invest in early stage technology companies. Their financial and technical help would guide Start Up companies through the ‘Valley of Death’, a phase when most Start Ups fail due to their capital being exhausted before their technology has become mature.
However, in the last few years, companies such as GE have changed their business model. They have moved to the wrong side of the ‘Valley of Death’ because of tax policy in the West. It is now more profitable for multinational companies to buy local companies that are already successful and to make them ‘tax efficient’ than it is to take risks with early-stage investments. Perversely, this has resulted in a drop in early-stage investment and forces StartUp companies to rely instead on government development funds (eg the Technology Strategy Board).
I dont have the figures, but it would not surprise me if the compound loss of industrial investment / New Start Ups was massive. The reduction in funding and expertise that Multinationals could have contributed would likely far exceed all government grants. Perhaps someone has data on this or could comment further?