Tax: Church Action for Tax Justice Reports

Baroness Sherlock Excerpts

Thursday 21st January 2021 Grand Committee

[Baroness Sherlock (Lab) [V]]

My Lords, I thank the right reverend Prelate the Bishop of St Albans for opening this debate so well and noble Lords for some cracking short speeches. I thank Church Action for Tax Justice for both reports. As an Anglican priest, the first report got me at the introduction by referring to the hard time that tax collectors get in the Bible. To be fair, in New Testament times tax collectors were more like a cross between gangsters and wartime collaborators.

It is now time to rehabilitate those who collect tax, and to make the case for taxation as a mark and means of our shared common life and our willingness to be responsible, one for another. Rehabilitation depends on taxation being fair and being seen to be fair. I cannot do domestic taxation in three minutes, so I will say two quick things. Levelling up has to address income and wealth, and you cannot look at personal tax without also looking at social security.

I will make four quick points from the reports. First, we need to be willing to call out unscrupulous corporate tax practices. The 2021 report calls for:

“The implementation of the provisions in the 2016 Finance Act that would enable public country by country reporting, plus the UK no longer blocking the OECD from publishing aggregate country by country data”.


Can the Minister respond to that, please?

Secondly, the tax system needs to be fair to all types of trader. The UK now has a digital services tax, but big firms are simply passing on the extra charges to customers, such as advertisers or marketplace sellers. Ministers see the DST as a stopgap measure until the OECD agrees a global solution, but that is not happening tomorrow. When do the Government plan to review the DST and will they commit to closing the loopholes that have been found?

Thirdly, there needs to be action on environmental taxes. These can be key to tackling the climate emergency. What work has been done in government to assess the different options? Is this something that is likely to feature on the agendas of our G7 and COP meetings later this year?

Finally, there is the matter of international tax rules and how and where they should be agreed. My noble friend Lord Collins of Highbury is leading a review of the UK’s policy in and towards the UN and its committees and subsidiaries. However, even without major reform, the UK could wield huge influence on international tax co-operation and many other issues. We were a founding member of the OECD, have a leading role at the UN and have some of the highest allocation of voting powers of the financial institutions. Despite that global Britain mantra, too often the UK is absent from the world stage at the moment. What steps will the Government take to seek better and swifter action on international tax co-operation? I look forward to the Minister’s reply.