Robert Palmer, Executive Director of Tax Justice UK said:
“Austerity isn’t over after all, and the tax system is still unfair. Our schools, hospitals and prisons urgently needed major injections of cash today. Instead the Chancellor made some eye-catching tweaks to existing pledges while awarding tax cuts to corporations and the wealthy. That is a missed opportunity.” On digital tax reforms: “Digital companies make an awful lot of money from our economy and haven't put enough back in to date. But £400 million won't go very far towards the £20 billion a year the government has said we need for the NHS. We need companies across the board to pay more - raising corporation tax is the best and fairest way to generate the money we need to fund our public services.” / Ends For interviews contact: Robert Palmer on 07817406618 or robert@taxjustice.uk or Oliver Courtney on 07815 731889 or oliver@digacommunications.com. Tax Justice UK is a new campaigning and advocacy organisation, with a mission to ensure that everyone in the UK benefits from a fair and effective tax system. Tax Justice UK is a partner of but independent from the Tax Justice Network. It is not-for-profit and politically non-aligned. For more information and to download a copy of the latest report on how the government should raise taxes on wealth to fund the NHS visit www.taxjustice.uk. The government has talked a lot about tools to curb corporate tax avoidance. A key power, which it has available to it, is to require multinational corporations to publish their accounts on a country-by-country basis. This information is already collected by companies but is currently only available to HMRC. Making this information public would help expose the extent to which companies can slash their tax bills.
Building on two academic studies, Tax Justice UK and our sister organisation, Tax Justice Network, estimate that this move could bring in £2.5 billion in tax a year by deterring corporate tax avoidance. In the run up to the budget statement, we’re calling on Chancellor Philip Hammond to make use of the legal power. Read the full briefing paper Read the methodology At least part of the extra £20bn a year the government has promised for the NHS should come from additional taxes on wealth, according to a new report from the campaigning organisation Tax Justice UK (TJUK).
Ahead of the budget later this month, the organisation is calling on the government to raise corporation tax, abolish entrepreneurs’ relief, reform council tax, make older workers pay National Insurance Contributions (NICs), curb the pension subsidy for the wealthy, and tax income from wealth at the same level as income from work. Together these proposals would raise over £23bn. “A clear majority of the UK public support increasing tax to help fund the NHS. This is a golden opportunity for the government to reform the tax system so that wealth tied up in property and other assets is taxed fairly,” said Robert Palmer, CEO of Tax Justice UK. In June 2018, Theresa May announced an extra £20 billion a year for the NHS by 2023. She promised that part of this would come from ‘fair and balanced’ tax increases. The NHS is facing rising costs due to an aging population, increasing obesity, and expensive new treatments. Estimates suggest that just to maintain the current service, spending will have to rise by 3.3% annually for the next 15 years, with increases of 4% per year if services are to be improved. This represents an extra £95 - £124 billion by 2033-34 – a lot more than the Prime Minister promised. In the current political and economic climate, further cuts to other government budgets such as defence, local authorities and housing would be difficult. Tax rises will have to form part of the solution to the NHS’s needs, and TJUK argues that the government should look beyond the three main taxes: income, VAT and National Insurance. The organisation proposes four guiding principles to determine which taxes should go up: companies and the wealthiest should pay their fair share to ensure trust in the system; tax should increase in proportion to a person’s wealth and income; a sustainable tax system needs to look beyond increasing taxes on just those at the top and companies; and the poorest should be protected from tax rises. In line with these principles it suggests raising the corporation tax rate to 20%, which would generate £8.4bn, abolishing entrepreneurs’ relief, which would raise £2.7bn, taxing income from wealth at the same level as income from work, which could raise £4bn, reforming council tax to more accurately reflect real property values, which would raise £5bn, applying NICs to earnings of those older than the state pension age, which would raise £1.3bn, and curbing the pension subsidy to the wealthy, which would raise £2bn. In total these reforms would raise £23.4bn a year. Robert Palmer: “Our proposal is just one way in which the government could raise taxes to fund the NHS and promote a more equal and fairer society. Any reforms along these lines would need to be accompanied by greater efforts to clamp down on tax avoidance and evasion. Ultimately this should be seen as a real opportunity to have a broader debate about the level of public services we want and how to pay for them.” / Ends Contact: Amy Barry on 07980664397 or amy@digacommunications.com; Oliver Courtney on 07815 731889 or oliver@digacommunications.com; or Robert Palmer on 07817406618 or robert@taxjustice.uk |
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June 2023
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