Non-domicile Tax Status

Debate between Baroness Winterton of Doncaster and Abena Oppong-Asare

Tuesday 31st January 2023 Commons Chamber

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

As we have heard from Opposition Members today, this Conservative Government have repeatedly failed to deal with the non-dom tax loophole, and what is the result? It is higher taxes on working people; tax breaks for the super-rich, when we could be training new NHS workers and delivering breakfast clubs for primary-age children; and a Government mired in sleaze and scandal, with a former Conservative Chancellor who found adhering to the ministerial code just too taxing. Just this morning, the International Monetary Fund predicted that the UK will be the only major economy to see negative growth. The choice is clear: slow growth, stale ideas and sleaze with this Government or ambition, aspiration and a clear plan with Labour.

I thank Members for their contributions to the debate. My hon. Friend the Member for Bradford West (Naz Shah) spoke passionately about how working people are picking up the tab for the Government’s failure to invest in her constituency. My hon. Friends the Members for Bristol East (Kerry McCarthy) and for St Helens South and Whiston (Ms Rimmer) got to the heart of this debate about the current system. This is about fairness—if people live here and work here, they should pay their taxes here. That was echoed by my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders), who said that this loophole should not exist.

My hon. Friend the Member for Leeds North West (Alex Sobel) asked a simple question, and I would be grateful if the Minister could answer it: how much tax has been lost by the loophole? Do the Government even know? My hon. Friend the Member for Lewisham, Deptford (Vicky Foxcroft) talked about how abolishing the non-dom status could help the Government to prioritise support for young people.

As my hon. Friend the Member for Ealing North (James Murray) clearly laid out, this Conservative Government are out of ideas and missing in action. Food and fuel costs are soaring, while our economy is left completely exposed. I am sure the Minister will repeat that rising prices are not unique to Britain and many countries are experiencing inflationary pressures, but what is unique to Britain is that we are at the bottom of the pack. What is unique to Britain is that the Government refuse to take action. Through decisions such as the one they will take today when they vote on Labour’s motion, the Government are entrenching the pressures that the economy faces and pushing costs on to working people as their own Ministers seek to avoid them.

No one will be reassured by the Government’s arguments that all countries are experiencing soaring inflation. The Prime Minister has repeatedly said that the UK will grow the fastest of all G7 countries, but today’s IMF stats set the UK far behind its competitors. Contrary to the assurances of the Prime Minister and Chancellor, we are the only G7 country that is forecast not to see its economy grow. The Chancellor could not be bothered to come to the House to respond to those stats today, but it is good to see the Financial Secretary to the Treasury in the Chamber.

The Conservatives have had 13 years in government, but they have failed. Throughout the chaos of the last year, with constantly changing Prime Ministers and Chancellors, the British public could be sure about only one thing—that their taxes would continue to rise while the pound in their pocket got weaker. While people’s pockets have been emptied, a few at the top are wriggling out of paying their fair share. The non-dom tax status allows the wealthy few to avoid following the normal rules and requirements met by people and businesses up and down this country who work hard and pay their taxes. Instead, those around the most powerful in Britain benefit from our country’s generosity while getting away with not contributing their fair share.

The non-dom tax status is an out-of-date, 200-year-old system that allows people to dodge millions in tax. The Government may pretend that the system is necessary to provide a trickle-down effect to the rest of the economy, but can they explain how countries with much more successful economies than ours manage without non-doms? Canada and Germany require their equivalent of non-doms to pay their taxes after just six months, and in America, they pay their tax from day one—day one! As a modern economy, Britain should operate with modern principles in line with other major economies such as France, Germany and Canada.

As we have heard, the non-dom tax loophole costs the economy £3.2 billion. With a modern taxation system, we could provide the much-needed investment that our public services are crying out for. A Labour Government would scrap the non-dom tax status and end tax breaks for private equity bosses and private schools. A Labour Government would crack down on hidden offshore trusts that allow people to avoid paying their taxes.

With the money that would raise, a Labour Government would fund the biggest recruitment drive in modern NHS history and provide breakfast clubs for all primary aged children. As my hon. Friend the Member for Ealing North laid out, Labour would train the next generation of doctors, nurses and midwives, so that the NHS can treat patients on time, as it did under the last Labour Government. Labour will support breakfast clubs for children across the country, because we all know that hungry children find it harder to learn.

A Labour Government would do all that by scrapping the non-dom tax status, as we called for ahead of the autumn statement. Although the Chancellor, or perhaps the Prime Minister, decided against it, the Chancellor told the Treasury Committee that he would look into it. Can the Minister tell us whether he has? The Government are yet to publish any analysis or provide an update on their considerations. Why are Ministers so quick to tax my constituents and so slow to act on non-doms?

That is why we are here today. We have heard about the difference that abolishing the non-dom status could make. Academics have estimated that the status costs the Government more than £3 billion, yet the Government refuse to move. Why? So far, they have refused to publish the analysis that would lay out exactly what trade-offs they are choosing to make. If the Government’s analysis shows that the non-dom status is an asset to our economy, why do they refuse to publish it? In his closing speech, will the Minister provide us with answers to some of the many questions raised today?

Labour’s proposal is not just about raising much-needed money; it is about fairness in the tax system, the same rules for all, and support for those who keep our economy growing. By voting against our motion today, the Government will make it clear exactly whose priorities they are here to serve, but Labour is clear that if people make their lives in Britain, they should pay their taxes here.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I call the Minister, I remind hon. Members that, if they have contributed to the debate, it is very important to get back in good time for the wind-ups.

Jagtar Singh Johal

Debate between Baroness Winterton of Doncaster and Abena Oppong-Asare

Wednesday 7th September 2022 Commons Chamber

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

Like many of my constituents, I am deeply concerned to hear that Jagtar’s legal team have provided evidence that Jagtar’s detention and torture took place following a tip-off by MI5. I am absolutely appalled by the Minister’s comments in the Chamber today, which show a lack of compassion and a lack of action on this issue. The Minister says he is unable to comment due to legal proceedings, but I believe it is in the Government’s gift, right now, to explain to the House what measures they are taking to remedy that. What review has taken place following what has happened? This is deeply concerning, and we cannot allow it to happen to many other people. I urge the Minister to clarify to the House whether a review has taken place, and what steps the Government have taken, instead of ducking and diving.

[Madam Deputy Speaker (Dame Rosie Winterton)]

We really must make sure that questions are very brief, so that I can try to get everybody in.

Point of Order

Debate between Baroness Winterton of Doncaster and Abena Oppong-Asare

Tuesday 7th September 2021 Commons Chamber

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

On a point of order, Madam Deputy Speaker. I raise this point of order in response to my question yesterday on the fact that I have received no substantial response to any cases relating to Afghanistan. The Prime Minister said yesterday that

“by close of play today every single one of the emails from colleagues around this House will be answered”.—[Official Report, 6 September 2021; Vol. 700, c. 26.]

By this morning, I had still received no response to any of my cases, and I have received a further 17 cases to which I have received no substantial response. Can you please advise me on how the Prime Minister can be encouraged to come back to the House and correct the record, and on how I can ensure that I receive responses to these urgent cases without further delay?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the hon. Lady for that point of order. I understand her concern about this. I know that undertakings were made yesterday, and the House will want to see them fulfilled, so I very much hope that those on the Treasury Bench will have heard her point of order and will relay it back to the Prime Minister and his office, to ensure that those undertakings are fulfilled.

Finance Bill

Debate between Baroness Winterton of Doncaster and Abena Oppong-Asare

Report stage & 3rd reading
Monday 24th May 2021 Commons Chamber

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Dame Rosie Winterton)]

With this it will be convenient to consider the following:

Amendment 24, page 63, line 9, leave out clause 109.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

Amendment 25, page 63, line 31, leave out clause 110.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

Amendment 26, page 64, line 1, leave out clause 111.

This and the other amendments relating to clauses 109 to 111 would prevent the creation of freeport tax sites in the UK.

[Abena Oppong-Asare]

I rise to speak to new clause 25, tabled in my name, and those of the Leader of the Opposition and my hon. Friends. The new clause sets out a number of tests that we believe the Government must apply to each and every freeport created in the UK. Before I come to the detail of those tests, I will make a couple of brief points about the Government’s intentions behind freeports. As I said in Committee, Labour wants every area to succeed, whether or not it has a freeport. We want good new jobs to be created right across the country, and our great British industries to be protected and supported. We want to see the UK at the forefront of new green manufacturing and technology, and we want a genuine re-distribution of power and opportunity to places that have been denied that for so long.

The Government clearly believe that freeports are a silver bullet for solving regional inequalities, and I simply remind them that they have been in power for 11 years now. Let me repeat that: 11 years. They must own the choices they have made, such as abolishing regional development agencies, cutting local authority funding, and pulling opportunities away from young people in some of the most deprived regions of the UK. Just recently, they scrapped the industrial strategy altogether. We need a proper plan that creates jobs and opportunities for everyone, regardless of where they live.

I will now turn to the new clause, and to the tests against which we believe our freeports should be judged if they are to succeed. First, freeports must create jobs, not simply move them from elsewhere. Too often, attempts at regional rebalancing have simply shuffled jobs around rather than creating them in the places that need them. We must end the scandal of people being forced to move to the other end of the country to find a decent job. Our test will be this: if someone lives near a freeport, will new opportunities be opened to them that did not exist before? Conversely, if an area does not have a freeport, can we be confident that it will not lose jobs as a result of this policy? Of course, any new jobs must be secure and well paid, with trade union rights—the kind of jobs we have not seen anywhere near enough of over the last decade.

Secondly, freeports must deliver improvements in training and skills for local residents. As we begin to recover from the pandemic, the need for re-training will become even more acute. We need a genuine skills guarantee for everyone, and freeports must play their part in that. Labour will be looking to see how companies operating in freeports work with their local communities to provide skills and training opportunities. Rather than a race to the bottom, freeports should be helping to boost skills and open opportunities.

Thirdly, freeports must produce tangible transport and infrastructure improvements beyond the port itself. Too many places still lack basic transport infrastructure, and too many people still find it difficult to get around. The investment that the Government are making in freeports must go towards boosting connectivity for everyone in those areas. We want every community to benefit from affordable and reliable public transport.