Groups are calling on politicians, including Rishi Sunak, the Chancellor, to reform the tax system post-covid to support a fairer, and greener, future
An influential group of think tanks, campaigners and charities has joined Tax Justice UK in agreeing common goals to build back better in a world affected by coronavirus.
The pandemic has reminded us just how valuable the contribution of carers, nurses and key workers is to a caring society. In the long term we need to be spending more money on health, care and other areas to ensure we have a resilient society and economy. However, this cannot happen without reform of the tax system.
The UK’s approach to tax is dysfunctional: we don’t raise enough money, avoidance is rife and wealth is under-taxed. Despite progress, estimates suggest that £35 billion to £90 billion of tax goes uncollected per year.
The government also spends over £164bn a year on tax reliefs - many of which are badly targeted and largely benefit the well off and big companies. The corporate tax rate has been slashed from 28% in 2010 to the current 19%. The UK also contributes through its reliefs and loopholes to a broken international tax system, which deprives other countries of revenue.
The Covid-19 crisis shows that the government has huge financial power, flexibility and choice over how to support public spending. Our statement Tax reform to support a fairer and greener future argues that as the immediate crisis fades there will be big political debates about how to build back better. A fair tax system should underpin more investment in high quality public services and we must be ready to challenge those who are already arguing for austerity 2.0.
Tax Justice UK has developed a series of high level recommendations we believe the government should implement.
The signatories to the statement are: Tax Justice UK, New Economics Foundation, Women's Budget Group, Church Action for Tax Justice, Oxfam GB, Christian Aid, Institute for Public Policy Research, Jubilee Debt Campaign, Common Wealth, Centre for Local Economic Strategies, Positive Money, Quakers in Britain, Equality Trust, Tax Research UK, War on Want, Ethical Consumer and Taxpayers Against Poverty.
Tax Justice UK is keen to work with other organisations who want to be part of a movement to bring about progressive tax reform and share our goals.
Download the statement here. Tax Justice UK has developed more detailed policy recommendations, which can be read here.