The impact of the cost of living crisis hit home this week in a Twitter thread by food campaigner Jack Monroe.

Jack pointed out that the official figure of a 5% increase in the cost of living massively underestimates the true costs faced by ordinary families. Looking at basic goods, Jack estimated that the price of pasta is up 141% in a year, canned spaghetti up 169% and rice up a whopping 344%. 

Weekly shopping bills appear to be rocketing and that's not all. The country is bracing for higher fuel bills. At the same time workers on very low incomes will be asked to pay a higher national insurance rate from April. Many people will also see steep council tax rises in the spring. Much of this is driven by councils increasing taxes to help fund social care costs. 

What is the government going to do about these bread and butter issues? 

On tax, Rishi Sunak has a choice. He can continue to ask those with the least to contribute even more.

Or he can ask those with the broadest shoulders to pay a fairer share instead.

The richest have done very well financially during the pandemic. Research from Oxfam found that the fortunes of the 10 wealthiest men in the world have doubled under covid.

A group of over 100 millionaires are calling for governments around the world to introduce wealth taxes. They estimate that a progressive wealth tax in the UK could raise £44 billion a year. It would only affect the very rich by starting once someone’s wealth was over £3.6 million. 

Tax is about political choices. It would make much more sense to close the tax loopholes open to the rich and powerful than focus on raising national insurance. 

If the pandemic taught us anything it's that we all rely on low paid care workers, nurses and shopkeepers who dug us out of the covid crisis. The cost of living is shaping up to be a huge political issue. We will continue to campaign for those with the greatest wealth to contribute their fair share.

The year already looks set to be dominated by concerns about the cost of living. The price of heating your home, feeding your family and other living expenses is already rocketing.  

So it was startling to learn that some people have pockets deep enough to pay $2 million for a single bottle of whiskey. 

It’s a jarring reminder of what wealth inequality looks like. This is in the midst of a pandemic in which the wealthy have seen their riches grow, while those with less have struggled.
 
Our Executive Director, Robert Palmer, was in the Guardian and the Financial Times this week commenting on new government figures on wealth. Analysis from the Office for National Statistics shows that wealth inequality is entrenched in this country. 

It’s highly likely that the official statistics underestimate the true level of inequality, as academics Arun Advani and Hannah Tarrant pointed out. 

Over the last thirty years, the level of wealth in this country has ballooned. At the same time taxes on wealth have barely budged. 

This is why Tax Justice UK will continue to press for wealth tax reform during 2022. 

The ongoing cost of living crisis is also why we joined with 27 organisations to urge the government to respond to the massive increase in energy bills. In a joint letter to the Prime Minister and Chancellor, we called for emergency funding for the most vulnerable, funded in part by a windfall tax on the fossil fuel industry. The organisations involved include Greenpeace, Age-UK and Save the Children.

At Tax Justice UK we have lots of other exciting plans for this year. We will continue to be a loud voice calling for tax justice. We hope you can join us in this. 

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New figures from the Office for National Statistics show that wealth inequality was entrenched for more than a decade before the pandemic hit. The analysis shows that wealth inequality is significantly higher than income inequality. 

The ONS statistical release “Total wealth in Great Britain: April 2018 to March 2020” was published today.

Even before the pandemic it was clear that wealth inequality was entrenched. Since covid hit the wealthy have seen their riches grow, while those with less have struggled.

If taxes have to rise it should be those with the most assets who pay. The Chancellor could start by equalising capital gains with income tax, tackling tax avoidance and ending tax loopholes.

Tax Justice UK has found massive public support for closing tax loopholes used by the wealthy and clamping down on tax dodging. ​

The official figures underestimate wealth inequality in the UK. Academics at the University of Warwick and LSE have pointed out that the ONS figures don't include business wealth and that the very wealthy are less likely to respond to the survey that the figures are based on. According to the analysis by Arun Advani and Hannah Tarrant the ONS under-reports total wealth by 8%. This means that wealth inequality is higher than official estimates. 

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2021 has been a hard year for many of us. The pandemic has dragged on and the cost of living is skyrocketing. 

As the year draws to an end we've been reflecting on the positives. 2021 was the year when Tax Justice UK properly arrived. We’re a small team of four people, but we’ve had some real impact. ​

Back in June, we helped force the UK government to support a minimum tax rate for global companies. We worked with the media, politicians and our partners to ramp up the pressure. Although the final outcome wasn’t everything we'd hoped for, it is still a big step forward.

In September we hit the headlines by appearing on BBC Panorama about the Pandora Papers revelations. Journalists around the world revealed how the rich and powerful use offshore structures to slash their tax bills and hide what they’re up to. 

In response more than 116,000 people signed our petition to close the tax loopholes. Last week politicians in Westminster were debating how to deal with the problem. 

In other ways we feel that the media narrative on tax and wealth is starting to change in our favour. In October our Head of Advocacy, Tom, traveled to the Conservative Party Conference. At one event on tax, the first three questions were about taxing wealth more. That wouldn’t have happened even a year ago. 

However, there are some clouds on the horizon too.

As we approach Christmas, it is troubling to know that families navigating the social care system still face misery. The 2.5% increase to national insurance announced over the summer in the government’s ‘health and social care levy’ will mostly go to the NHS, rather than social care.

To be frank, raising national insurance is a bad way of supporting social care. Especially as we’ve had a pandemic that saw the wealthiest become even richer.

The pandemic should be an opportunity to change direction away from the deep inequalities that mark our society but as the Guardian's Polly Toynbee pointed out the actions of the Chancellor, Rishi Sunak, risk taking us in the wrong direction.

​​​We want 2022 to be a year when those with the broadest shoulders pay a fairer share of tax. We will be keeping up the pressure to move us towards tax justice.

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Sara and Robert visited Downing Street this week to deliver our petition calling on the government to end the tax loopholes open to the rich and powerful.

In the end more than 116,000 people signed the petition. We want the government to meet its promises to tackle tax dodging.

Our petition will be harder to ignore given the response we have had from the media. In the past week this issue has been taken up in earnest, with coverage in The Times, Financial Times, the Guardian, Daily Mail and a host of other places. We’ve worked hard with our allies to get journalists to cover it. 

It’s a great response that shows the public and the media are united in agreeing that the government needs to act.

Last week 40 MPs, including 17 Conservative backbenchers, wrote to the Prime Minister calling for action following the Pandora Papers. A draft law has been ready since 2018. Now is the time for action.

We will continue to work with the media, MPs and our partners to pressure the government.

If covid taught us anything, it’s that we need each other. From the carers keeping us well to the shopkeepers who kept food on our tables, the pandemic showed how much we all rely on each other. 

The budget was a chance for the Chancellor to build on that legacy. Instead Rishi Sunak wasted no time setting out dividing lines. 

Rather than asking banks to pay more, he gave them a tax cut. This at the same time as he is increasing taxes on ordinary workers through a national insurance rise. 

Instead of turbo charging efforts to get to net zero, he cut air passenger duty on domestic flights. This is a backwards step. Many will see this decision as a snub ahead of the COP26 climate summit being held in Glasgow next week.

There was no action to tackle the scandals highlighted by the Pandora Papers. Despite a recession in which the richest and some businesses did very well, there was nothing on wealth taxation or a pandemic profits tax either.

There was welcome investment in local authority spending and £1 billion for the levelling up fund. More money was also announced for education, bringing schools to the level they were at in 2010 according to the Institute for Fiscal Studies. The cut to Universal Credit was lessened to some degree. The promised funding for the NHS was included. 

​But as a former Conservative special advisor pointed out, the spending promises were small in the scale of things.

This budget was a missed opportunity that sent the wrong signals on who’s paying higher taxes, clamping down on tax avoidance and curbing climate change. 

New polling by Tax Justice UK has found growing anger at tax avoidance among Conservative voters in the wake of the Pandora Papers.

​The Pandora scandal revealed how the rich and powerful, including senior politicians and political donors, continue to use opaque ownership structures to buy property and reduce their tax bills.

The poll carried out by Survation for Tax Justice UK found that:

• 80% of the public, and 83% of Conservative voters, support “tougher action” against tax avoidance in the wake of the Pandora Papers revelations.
• The proportion of Conservative voters who think tax avoidance by large companies is “morally wrong even if legal” jumped from 86% in June 2020 to 90% now. This is higher than the figure for the public at large (81% to 85%).
• The proportion of Conservative voters who think tax avoidance by individuals is “morally wrong even if legal” increased from 83% in June 2020 to 87% now. This is higher than the figure for the public at large (77% to 82%).

Voters as a whole, and Conservatives in particular, are fed up with the rich and powerful slashing their tax bills. 

It is deeply unfair to see a small minority paying less tax at the same time that the government is raising taxes on ordinary workers.

Rishi Sunak needs to show that he understands the public anger that is out there and use the budget to signal he will close the type of loopholes revealed in the scandal.

Almost 100,000 people have signed Tax Justice UK’s petition calling on the Chancellor to enact a Bill that would crack down on avoidance in his Budget.
 
Tax Justice UK is calling for Rishi Sunak to close tax loopholes and invest properly in HMRC so that everyone pays their fair share. The government should finally introduce the stalled plan to shine a light on the offshore owners of UK property and beef up the powers of Companies House.

​Survation carried out fieldwork via an online panel with 1,003 UK residents aged 18+ on 11 and 12th October 2021. The full results can be downloaded here. 

The poll is an update on a survey carried out by Survation in June 2020.

Last week nearly 140 countries took another step towards a global tax deal that will limit the scope for big companies to dodge taxes by shifting their profits overseas. 

There were some very small positive last-minute changes to the deal, which the OECD believe will raise up to £130bn globally by preventing big companies from avoiding tax.

The deal will be a landmark in the struggle for tax justice, by reigning in the largest multinationals who have for too long been able to exploit the rules to unfair advantage.

But it is not a silver bullet. 

First the global minimum corporate tax rate will be  too low. At 15% it will not be sufficient disincentive to prevent profit-shifting out of the UK, where the headline corporation tax rate is going up to 25%. It will not create a level-playing field for domestic businesses. 

Second, despite some small improvements to the deal, the overwhelming benefit will go to the G7 countries who have led the process. The US will be the major winner. A lot more could be done to split the extra tax raised fairly across the world. Countries in the Global South should have more power over the setting of global tax rules. 

Finally, it’s not clear that the deal will be better at taxing the biggest technology firms than individual digital taxes already in place in some countries - such as the UK’s digital services tax. Letting the tech giants off the hook would be a catastrophe. 

​We have come a long way to get to a deal, but clearly there is more work to be done. Once the dust has settled on the details though, this agreement could be the first of many, each of which take us a step closer to global tax justice.

The Pandora Papers have exposed how the rich and powerful can still slash their tax bills.

Tax Justice UK has decided it's time to act, but we need your help.

We want to whip up media pressure on the Chancellor to tackle tax avoidance in his Budget on the 27th October.

Over the last ten years a lot has been done to clean up these types of schemes. However, much more could still be done by our politicians. 

Support our crowdfunder and help us put pressure on the chancellor to act.

If it chose to, our government could use its 80 seat majority in the House of Commons to clamp down on tax dodging. Politicians could lift the lid on the type of opaque offshore companies  used by Cherie Blair to avoid a £300,0000 stamp duty payment for the purchase of office space.

A law creating a public register of who really owns UK property through offshore arrangements is gathering dust in parliament. The government should pass this legislation now. 

Many of the professionals who enable abuse aren't regulated properly, as this report by Transparency International UK points out. There's limited enforcement when bankers, accountants and lawyers are found to have enabled wrongdoing. 
 
Finally, as our friends at TaxWatch revealed earlier this year, you are 23 times more likely to be prosecuted for benefit fraud in the UK, than tax fraud. Yet the government has cut the number of tax inspectors working for HMRC.  This is about political will.
 
Tax officials bring in many times the revenue that they cost. Between 2016 and 2019 HMRC carried out a third fewer tax inspections. This should change. 

The Pandora Papers is hot news because it exposes lurid details about how the rich and powerful live. If politicians want to end this kind of coverage, it’s in their power to act.

Almost 100,000 people have supported our petition urging the a government clamp down on the tax loopholes used by the rich and powerful.

Sign the petition here. 

​Read our letter to Rishi Sunak calling for action. 

When we set up Tax Justice UK back in 2017 we wanted to make progressive taxation an issue that politicians were confident to talk about.

For too long wealth taxation in particular had been a no-go area for MPs. They were often fearful of media and political backlash if they suggested taxing wealth in a smarter way. 

The Labour Party conference shows how far we’ve come. 

In advance of her speech, the shadow chancellor, Rachel Reeves said: “I do think that people who get their income through wealth should have to pay more”. This is something we've been calling for alongside our allies. 

Reeves set out how unfair the tax system is and laid down principles for how a Labour government would deal with tax reform. She announced that Labour would scrap business rates and replace them with something “fairer”.  

She also warned Amazon’s billionaire boss Jeff Bezos: “If you can afford to fly to the moon you can pay your taxes here on earth!” She committed to ensuring the digital giants pay a fair amount of tax in the UK. 

It’s now clear what the shadow treasury electoral strategy is - they want to build a broad coalition with proposals that both keep the Labour membership happy, but also capture business support. 

But for them to succeed there is more work to be done. The shadow chancellor did not commit to taxing income from wealth the same as income from work. And while the opposition’s course on tax issues appears to be heading in the right direction, we still haven’t heard enough detail on their plans. 

Finally, I am concerned that Labour is still talking about the need to “balance the books” as a household would have to. Government finances are not the same as a household, as our colleagues at NEF have pointed out. Borrowing is still very cheap. The consensus amongst economists is that the government should be spending now to support the recovery, rather than worrying too much about the deficit. 

We’ll keep pushing politicians of all stripes to commit to taxing big companies and the wealthiest. This will help support the public services we all rely on as we recover from the pandemic, and meet the challenges of climate crisis, rampant inequality and demographic change.

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