Tax Avoidance

Dawn Primarolo MP's response to constituents on the subject of tax avoidance:

 

"Thank you for contacting me recently regarding tax avoidance.

I strongly believe that everyone should pay their fair share of tax. When I was a Treasury Minister in the previous Labour Government I worked hard with my colleagues to close tax loopholes and am proud of the changes we made at the time, however, there is clearly further work to be done to tackle tax avoidance.

 

I know from the many e-mails I have received on this issue in recent days that there is anger and frustration at the recent allegations that some banks, corporations and wealthy individuals may have engaged in aggressive tax avoidance and, in some cases, tax evasion.  At a time when the Government are proposing deep cuts to our public services and when households up and down the country are seeing their incomes squeezed, it is vital that we clamp down on tax avoidance and ensure that corporations, businesses and individuals pay their fair share.

I find it very concerning that the Government has failed to tackle tax avoidance in the last five years and that the amount of uncollected tax has risen year on year - increasing to £34 billion in 2012/13.  The Government also has questions to answer over the recent allegations of malpractice at HSBC bank - in particular why there has only been one prosecution out of the 1,100 people who are alleged to have avoided or evaded tax and why the Government signed a deal with the Swiss in 2012 which prevents the UK from actively obtaining similar information in the future.

I welcome the proposals of the many charities and organisations that have called for an Anti-Tax Dodging Bill and I agree this will be a vital issue for the next Government to address after the General Election in May.

I am very pleased that Labour’s Shadow Frontbench has announced that a future Labour Government would introduce a range of measures in their first Finance Bill to clamp down on aggressive tax avoidance, including: introducing penalties for those who are caught by the General Anti-Abuse Rule; closing loopholes used by hedge funds to avoid stamp duty; closing loopholes like the Eurobonds loophole which allows some large companies to move profits out of the UK and avoid Corporation Tax; stopping umbrella companies exploiting tax reliefs; scrapping the Government's "Shares for Rights" scheme which the Office for Budget Responsibility has warned could cost £1 billion in avoidance; and tackling disguised self-employment.

Along with stronger independent scrutiny and greater transparency of the tax system, I believe these steps could make a real difference in the fight against aggressive tax avoidance.

Thank you once again for writing to me and for sharing your views. I can assure you that I will continue to follow this issue closely and bear in mind the points you raise.  Please do not hesitate to contact me again if I can be of further help with this or any other matter.

 

Yours sincerely

 

Dawn Primarolo

Labour MP for Bristol South"

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