The Conservative donors who own the JCB digger company may be hit with a £500 million tax bill according to the Guardian.
HMRC has been investigating brothers Anthony and Mark Bamford’s extensive offshore business empire for over three years.
The Bamfords are alleged to have aggressively minimised the payment of UK taxes. HMRC may seek to recoup large sums of lost tax if the allegations are proven correct.
In September a Labour MP asked the Conservative Party if they would return £10 million donated to them by JCB.
JCB were also recently spotted at the Labour Party conference, exhibiting along with many other businesses on the conference floor.
£42 billion in missing tax
JCB is just one multinational company operating in the UK. The obvious question is: to what extent might other big companies be aggressively minimising their taxes?
The responsibility for answering this question lies with the UK’s tax authority, HMRC.
Yet the Revenue is woefully under-resourced for the job at hand. Earlier this year MPs slammed the government for underfunding the tax authority.
Members of Parliament’s Public Accounts Committee said HMRC did not have enough staff to properly investigate underpaid tax. And estimated that up to £42 billion could be missing in unpaid tax.
Parliament also said that for every £1 invested in HMRC investigations, £18 was recovered in additional tax.
Global tax avoiders
Aggressive tax avoidance extends beyond the UK, of course – and may help explain how just 2,756 individuals have amassed over £13 trillion of wealth between them.
These are the billionaires. And they are paying on average between 0 and 0.6% tax on their wealth, a stark new report showed this week.
Using tax loopholes, shell companies and profit shifting, the world’s three thousand richest individuals have been operating on “the borders of legality”, the report from the EU Tax Observatory argues.
The Tax Observatory – which was set up to steer EU tax policy – argues a 2% annual tax should be introduced on billionaires’ wealth. They say it could raise £250 billion annually.
It’s encouraging to see a major tax body back wealth taxes on the super rich. Our own research shows up to £50 billion a year could be raised in the UK alone through higher taxes on wealth.
Beyond wealth taxes, loopholes for billionaires and multinational companies must be closed – and our tax authorities properly resourced to scrutinise them properly.
Rebuilding our broken society
This is not simply a question of fairness and transparency, but one of an unequal and broken society.
3.8 million people in the UK are living in destitution. They can’t afford to meet their most basic needs for shelter, food or energy. That’s the shocking finding of an investigation by our friends at the Joseph Rowntree Foundation this week.
This is a disgrace. Our politicians should hang their heads in shame. The safety net we all rely on if we fall on hard times is totally failing nearly 1 in 10 people in the UK.
But something can be done. There is money available to fix these problems, as our executive director Robert Palmer told Times Radio this week.
We can renew our broken society, taking more from the very very rich and repairing our NHS and public services.
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