EU-UK Trade and Cooperation Agreement

Lord Sikka Excerpts

Friday 8th January 2021 Lords Chamber

[Lord Sikka (Lab) [V]]

My Lords, despite commitments to fair competition and level playing fields, the TCA says little about tax policies. We had no debate and no ministerial clarification on the matter. The issues are likely to be problematic, especially as the UK is well on the way to becoming a tax haven for big corporations and the rich. Here, taxes have been shifted from capital to workers and consumers, unearned income is taxed at a lower rate than earned income, non-dom millionaires enjoy special privileges, and many companies pay little or no corporation tax. Despite numerous court cases, no big accounting firm has been investigated, fined or prosecuted for peddling unlawful tax avoidance schemes.

Outside the EU, the impulse of the Government is to turn the UK and its Crown dependencies into harmful tax havens. Inevitably, this will invite disputes about what fair competition, level playing fields and state aid mean. Last Sunday, the Prime Minister told the BBC’s “The Andrew Marr Show”, “You can use tax systems and subsidies to drive investment.” In this race to the bottom, the Prime Minister made no mention of the social costs. There is a failure to understand that businesses thrive on good social infrastructure, and this requires transparent and responsible tax policies. Will the Minister provide assurances that the Government will not turn the UK into a shabby tax haven for the rich and for footloose capital?

G7 Summit

Lord Sikka Excerpts

Thursday 26th November 2020 Lords Chamber

[Lord True (Con)]

My Lords, I share the noble Lord’s tribute to my good friend and noble friend Lady Sugg. The Government are committed to supporting international development and helping the world’s poorest people, as we have shown already in 2020, hosting the world’s biggest ever summit to raise funding for vaccinations in the poorest countries, and we continue to commit to supporting developing nations against the coronavirus problems.

[Lord Sikka (Lab) [V]]

My Lords, I draw attention to the Register of Members’ Interests, which states that I am an unpaid adviser to Tax Justice Network. We all know now that tax revenues are vital for economic recovery. A report by Tax Justice Network has estimated that, globally, more than $427 billion is lost each year due to corporate tax abuses and private tax evasion. The UK’s Crown dependencies and overseas territories are responsible for more than one-third of global tax losses. Will the Government ensure that curbing tax abuse is on the G7 agenda?

[Lord True (Con)]

My Lords, of course I note the points made by the noble Lord. The Prime Minister will give further details on the agenda for the G7 shortly.

Future of Financial Services

Lord Sikka Excerpts

Wednesday 11th November 2020 Lords Chamber

[Lord Agnew of Oulton (Con)]

I thank the noble Baroness for her question. In relation to the equivalence announcement, we are taking on board 17 equivalence rules. In the interests of brevity, I shall not go through all of them, but I shall ask that they are entered into Hansard. The point the noble Baroness makes about the early or perfunctory removal of equivalence is something we have taken on board. Indeed, other countries have expressed this as one of the EU’s problems, and it will be our intention to have a more transparent process that gives those countries the ability to respond to issues and have a more iterative dialogue.

In relation to the noble Baroness’s points on pension fund assets allocation, I touched on this yesterday in the Statement in relation to local government pension funds, and it is certainly a priority for us to try and steer some of these assets, on a low-risk basis, into infrastructure development.

[Lord Sikka (Lab) [V]]

My Lords, the finance industry has been engaged in bribery, corruption, money laundering, tax avoidance and mis-selling of numerous products. The victims of RBS and HBOS frauds are still awaiting compensation. In July this year, the Intelligence and Security Committee said some aspects of the finance industry were also a threat to national security. I ask the Minister and urge the Government to appoint an independent inquiry into the finance industry, as that would be a good way of promoting public confidence in the industry.

[Lord Agnew of Oulton (Con)]

I do not accept the noble Lord’s harsh criticisms of the sector. As in any sector, one gets miscreants, but is important to remind the noble Lord that this industry employs over 1 million people in this country and contributes £130 billion to our national economy and some £75 billion in tax receipts.