My talk at the Green Party last night

Posted on

I spoke at a fringe meeting at the Green Party last night. This is roughly what I said (as I never stick to my script):

Thank you for inviting me to speak this evening.

I admit the theme of tonight's event is familiar to me. I have now dedicated more than a decade of my life to asking what we can do about tax dodging. That would, I think you would agree, have been a bit of a waste of time if the answer was “not a lot”. Thankfully, it isn't.

Right here, right now in the UK there is an enormous amount that we can do to tackle tax dodging. What I'm pleased to note is that again, right here, right now in the UK, you in the Green Party are amongst the few who are taking those options seriously.

Before, however, I explain what we can do about tax dodging, let me make it clear why tax is so important.

Most people think tax is just about raising revenue to pay for government services. And of course, to some extent that's true.

But, tax is about many more things than that.

Tax is about redistributing wealth and income to those who need it, to relieve poverty and to create opportunity in our society.

Tax is also about repricing market failure. It makes the polluter pay. It puts a price on the finite resources of the world. It imposes a cost on harmful activity.

As importantly, in the way that tax raises money and in the way that it is spent, and in the balance of the two, tax lets government intervene in the economy to build the society we want.

As a result of all these things tax is the way in which democracy is put into action.

But what that means is that having a fair, honest, and robust tax system is an essential foundation for a vibrant society where everyone's voice is heard and respected.

I regret to say that this is why I also think that right now we aren't getting the tax system we need. Neoliberal politicians know that if tax dodging was brought to a close in the UK then there would be no deficit and so there would be no austerity and they would not have an excuse for cutting the size of the state or the role it plays in creating the future that we all want, but they don't. Tax dodging does, as a result, suit their purpose.

That is why, I suggest, that our domestic tax authority — HM Revenue & Customs - so drastically understates the tax gap in this country. They say that the tax gap is about £35 billion a year. I think it is more than £100 billion a year. I am candid: I accuse them of deliberately miscounting. They ignore abuse by the likes of Google, Amazon, Apple and others and wilfully go on from there.

So, the first thing that we have to do in this country if we are to tackle tax dodging is to correctly estimate how much tax is lost to our government each year. It's absurd that there are only two such estimates at present, one by HMRC and the other by me. Isn't it time we got some others, properly funded and definitely independent of HMRC and representing a range of political and economic outlooks to look at this issue? I don't care if they think I'm wrong: I know for certain they would prove HMRC are.

And then we need to learn the lessons from such a study. It will show, I promise you, that tax avoidance is important. But, maybe, not nearly as important as you think. I now think inroads have been made into tax avoidance. Big companies no longer want attention from UK Uncut, Christian Aid and me. They're changing their ways. And no one wants to be a Jimmy Carr or Gary Barlow. The price of becoming a tax avoider has been increased. We know that campaigning works.

But that does not mean that the mechanisms we have to tackle tax avoidance can't be improved. We need to sweep away the fig leaf of a General Anti-Abuse Rule this government introduced and deliver a proper general anti-avoidance principle that says if you try to cheat on your taxes we can stop you.

And we definitely need to force all multinational corporations to put on public record exactly where they trade and pay their tax. That is of course country-by-country reporting, which I first created more than a decade ago.

We could also demand that anyone bidding for a public contract get the Fair Tax Mark. One FTSE company has done it. More will follow, I can assure you, because I am the creator and a director of this scheme. It is possible for companies to do it. It should become the norm.

But that does not avoid the fact that tax evasion is a problem at least four times bigger than tax avoidance is now, in my estimate. And that means we have to turn on the cheats in our communities, and maybe even in this room. Yes, this is uncomfortable stuff.

But dealing with this is essential if we are to build an honest economy where those who pay can compete on a level playing field with those who don't. This is the foundation for a sound small business economy. In that case I always wonder why the free marketeers don't want it. What does that say?

So we need to invest, heavily in HMRC. Not just to enforce the living wage, which they regulate and  on which I applaud your new commitment, but to collect the tax that is due in this country.

And we need to invest in proper company regulation so that the 400,000 companies that go missing in this country each year without paying their tax are brought to account. This licenced identity theft is made possible by our state because it is obsessed with deregulation and reducing the so called burdens on business.  But its light touch has now reached the point where paying tax has become optional for many businesses. This has to be stopped, and I'd like to thank Caroline Lucas for her support for my work in exposing this issue.

So we have to change our attitude to tax. Tax is not a burden. Tax is something that can liberate us to make the choices that can transform our lives, our economy, our future, and our sustainability. We can have these choices but only if we embrace the fact that this means we must collect the tax we need to put those options on our agenda. It's precisely for this reason that I'm writing a book called the Joy of Tax, out next March, that will set out how this could work.

Instead we have the neoliberal option right now, of talk of deficits, of cuts, of tax being our oppressor and that we have no choice but keep grinding our economy into the ground to meet the needs of the markets — who despite the rhetoric are actually buying all the debt the government can offer them because it is, as any wise investor knows, the best place to invest right now.

So beating tax dodging involves practical action. But it also means we must rebuild our political narrative on tax. And that's precisely where you come in.

You are the change we need. You can help deliver this. Tax is high on your agenda and I welcome that. But what you need to do is change the headlines. We're not hear to simply beat tax dodgers. That just makes them look like petty criminals.

No, we should be saying that it is tax that gives us choice and the future we need and that the cheats are denying us that. They're stealing our future. And that's large scale crime.

It's when the world realises that this is the case that we'll really get change. I'm hoping you can do that, starting tonight.


Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:

You can subscribe to this blog's daily email here.

And if you would like to support this blog you can, here:

  • Richard Murphy

    Read more about me

  • Support This Site

    If you like what I do please support me on Ko-fi using credit or debit card or PayPal

  • Taxing wealth report 2024

  • Newsletter signup

    Get a daily email of my blog posts.

    Please wait...

    Thank you for sign up!

  • Podcast

  • Follow me

    LinkedIn

    LinkedIn

    Mastodon

    @RichardJMurphy

    Twitter

    @RichardJMurphy

    Instagram

    @RichardJMurphy