Nick Shaxson ■ Britain goes to the polls: the tax avoidance election
An interesting thing about the forthcoming UK election is that the subject of ‘tax avoidance’ has risen up the agenda so far and so fast. This guest blog briefly reviews the main parties’ manifestos, with a look out for their uses of the term.
[We should add, by the way, that ‘tax avoidance’ is a tricky term to use, and is often wrongly used, as David Quentin has reminded us. We prefer terms such as ‘tax cheating’ which sidestep tricky questions of legality.]
The UK’s Tax Avoidance Election
By Dan Hind
The Conservatives have said that they will ‘crack down on tax evasion and aggressive tax avoidance’. They claim that they ‘will raise at least £5 billion’ by doing so. Their manifesto includes 4 mentions for ‘tax avoidance’, up from 0 in 2010.
Labour have said that they will create a ‘fairer tax system’ by closing loopholes, imposing tougher penalties, reviewing the culture and practices of HMRC. They also pledge to introduce country-by-country reporting, unilaterally if necessary. Meanwhile, ‘British Overseas Territories and Crown Dependencies will be required to produce publicly available registries of the real owners of companies based there.’ There are 4 mentions of ‘tax avoidance’ in their manifesto, up from 1 in 2010. Labour has committed to end non-domicile status.
The Liberal Democrats pledge to introduce a general avoidance rule, to set a target for HMRC ‘to reduce the tax gap’ and to invest in staff. The also propose creating a new crime of ‘failure to prevent economic crime, including tax evasion’. They say that they will levy penalties on ‘firms proven to facilitate tax evasion, equivalent to the amount of tax evaded by their clients’. They want to ask the Bank of England to include how banks handle tax in their assessment of risk in the financial sector and they will restrict access to non-domicile status. There are 9 mentions in the 2015 manifesto, up from 3 in 2010.
UKIP say that ‘the public has every right to be angry’ that ‘that a few multi-national corporations have been able to access all the benefits of our thriving British consumer market without making a proper contribution to the costs of British society. Thy say they will restore ‘British tax sovereignty’ and ‘end the practice of businesses paying taxes in whichever EU or associated country they choose’. They will also set up a Treasury commission to ‘to monitor the effectiveness of the new Diverted Profits Tax and bring in any further measures necessary to prevent large multinational corporations using aggressive tax avoidance schemes.’ They mention tax avoidance once, up from 0 in 2010.
The Greens (England and Wales) commit to automatic information exchange and the abolition of non-domicile status. They also say that they will ‘consider making the £2 billion industry of designing, promoting and selling tax avoidance schemes illegal’. They want to ‘consider’ introducing a Land Value Tax and they say that they are part of a movement seeking to establish a global wealth tax. As part of their policy offering for foreign aid they propose to ‘take real action to end tax evasion and avoidance and transfer mispricing by transnational corporations, which steals resources especially from poorer countries’ and ‘support global efforts to develop a fairer global tax system’. They mention tax avoidance 9 times, up from 1 in 2010
The SNP support ‘calls for a global fair tax summit to agree international measures to tackle tax abuses’ and ‘will back measures to tackle tax avoidance, including early legislation to address tax dodging and an increase in staff resources at HMRC.’ They will also ‘put forward measures to strengthen anti-avoidance law across the UK to ensure it is as strong as new Scottish legislation’ They too plan to abolish non-domicile status. They mention tax avoidance 4 times, up from 0 in 2010.
Both UKIP and the Conservatives always preface ‘tax avoidance’ with the word ‘aggressive’ in their manifestos.
Making a killing from care
Tax Justice Luxembourg responds to #OpenLux
Tax Justice Network partnership with Federal Inland Revenue Service of Nigeria explores new audit tool
Big Tobacco, big tax abuse
Tobacconomics: Measuring the value of cigarette taxes
$427bn lost to tax havens every year: landmark study reveals countries’ losses and worst offenders
Corporate profit misalignment: An analysis of German parent companies and their foreign affiliates
Offshore, National Security and Britain’s Role
Tax Justice Network’s offshore wealth estimates have just been validated by the OECD
Ashes to ashes: How British American Tobacco avoids taxes in low and middle income countries
20 April 2019