Tax Avoidance and Evasion

Angus Brendan MacNeil Excerpts

Tuesday 14th November 2017 Commons Chamber

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Will the right hon. Gentleman correct the record? He said earlier that the UK led on the 0.7% target, but the UK was 40 or 45 years late. The 0.7% target was agreed in 1970, and the UK reached it decades behind the Scandinavians. I do not see that as leadership. Does he want to come back on that?

[Mr Mitchell]

The hon. Gentleman cannot get away with such a narrow, partisan comment. Britain was the first G8 country to stand by its commitment to the poorest people in the world, and we are very proud that it was this Government who did it.

The highly respected Africa Progress Panel, in a recent study on the Democratic Republic of the Congo, made it clear that stolen funds and stolen taxes cost that country £1.5 billion, which is more than it spends on health and education. It is a deep irony that some of the world’s poorest people live on top of some of the richest real estate, as is clear in the DRC. Credible World Bank studies make it clear that the money stolen from the people of Africa through unpaid taxes or concealment dwarfs all the foreign direct investment and international development money that flows into Africa each year.

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[Kirsty Blackman]

I agree with my hon. Friend on that, as I, too, have constituents who are exploited by organisations such as BrightHouse. It is not a company that anyone reputable should be investing in.

It is not that difficult for people to pay the tax that they owe; it is not that difficult to say to a financial adviser—this is for those who have bags of cash—“I would like my money to grow, but I wouldn’t like it to grow by avoiding the tax that I owe.” It would be easy for people to say that. It is clear that some people lack a moral compass. Where they are taking decisions to engage in aggressive tax avoidance, the Government must legislate so that they can no longer do so—to provide that moral compass for people and make sure that the tax is paid when it is owed. We must have the best possible tax rules in place. We must simplify the tax code. We must crack down on evasion, and we must legislate to reduce avoidance. The Government are in an untenable position: they cannot continue to implement austerity while leaving a tax gap.

[Angus Brendan MacNeil]

We note that many of the tax avoiders do not avoid using our roads, our schools and our hospitals, and they certainly do not avoid using the police to look after their lumps of money, here, there and everywhere.

[Kirsty Blackman]

I absolutely agree with my hon. Friend from the Western Isles. People, however much they are earning and however much tax they are paying, are using public services. Our party aspires to have brilliant public services. We aspire to have people working in our public services who are paid a reasonable amount and do not have to face a pay cap. The only way we can provide the public services and benefits system we want is by having a system where people pay the tax they owe. We continue to call for this to be devolved to Scotland because we think we would take better decisions. In the absence of devolution, we would like the UK Government to take actual action, rather than just saying, “Look how great we are.”

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[James Cartlidge]

I was referring to my earlier intervention, when there was some confusion; the point of substance I was trying to get at was the difference in the tax gap. The precise figure for the tax gap is now 6%, and it was 8% under Labour. The difference in annual terms is £11.8 billion. That is incredibly important, as the newspapers are dominated by all the coverage of the Paradise papers, and the impression that gives the public is that multinational companies are running the rule over us and getting away without paying their fair share of tax, and that we are failing to deal with that. In fact, all the statistics show significant improvement under this Government in closing the tax gap and bringing forward measures to deal with avoidance and evasion.

As my hon. Friend the Member for Amber Valley (Nigel Mills) mentioned, one important issue is property. My experience, before I came to the House, was in property, as I ran a business helping first-time buyers. One of the great grievances felt by first-time buyers is the sheer quantity of money that has come into the property market, particularly in London. That money is driving up prices and making property less accessible to local people who want to get on the ladder. We should remember that we have brought in two important measures to deal with that. Until April 2015, foreign nationals did not pay capital gains tax when they sold a property in the UK. We closed that loophole in April 2015.

[Angus Brendan MacNeil]

Is not one of the greatest problems of the housing crisis described by the hon. Gentleman the inequality in the UK, where the 100 richest individuals have the same wealth as the bottom 19 million? Indeed, globally, the 85 wealthiest people in the world have the same wealth as 3.5 billion people.