ASOS and Serco were among six companies across finance, outsourcing, retail, real estate, mining and pharmaceuticals who made £16 billion in excess profits during the pandemic.
Our new report “Pandemic Profits: who’s cashing in during covid” shows that a number of companies saw their global profits leap during the last 18 months. The profits of one company, the Scottish Mortgage Investment Trust, were up 801% compared to previous years.
The report argues that these companies are examples of a broader trend where some companies benefited from government pandemic spending, while others were well placed to profit from economic changes that have been accelerated by covid.
The covid pandemic has been unprecedented in its impact. Not only did it cause a recession that saw the wealthiest grow richer, whilst others struggled, it also resulted in some companies making what appear to be unprecedented profits.
The report argues in favour of a tax system that supports a fair recovery and keeps up with the economic changes accelerated by the pandemic.
Those who have suffered over the last 18 months should not be asked to pay more, however, it is fair to expect those who have prospered to contribute more to the economic recovery.
The report recommends that the Chancellor:
You can read the report here.
The government will raise National Insurance by 2.5% and announced a similar increase to the way dividends are taxed to help fund social care.
Investment in the care system is long overdue but the majority of funding in this announcement will go to the NHS. Nor does the policy go far enough, according to plans set out by the Women’s Budget Group.
Tax Justice UK Head of Advocacy, Tom Peters, said: “Tackling the crisis in social care is long overdue, but the proposed reforms don’t go far enough, and National Insurance is an unfair way to fund investment in the care system.
“After a pandemic that saw the wealthiest become even richer, those with the broadest shoulders should be first in line to take the strain as we start to build back.
“That means tax reforms including equalising capital gains with income tax, abolishing tax loopholes and ensuring companies pay their fair share of tax should also be on the table if we are to create the best possible social care service for all."