David Gauke
Main Page: David Gauke (Independent - South West Hertfordshire)Department Debates - View all David Gauke's debates with the HM Treasury
(9 years, 4 months ago)
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David T. C. Davies (Monmouth) (Con)
6. What steps he is taking to reduce the tax gap.
The Financial Secretary to the Treasury (Mr David Gauke)
Since 2010, the percentage tax gap has stayed lower than at any point under the previous Labour Government, saving the country £4 billion. One way in which the Government will address the tax gap is by tackling tax avoidance and evasion. We have committed to raising at least £5 billion more from measures to tackle evasion, avoidance and aggressive planning within the tax system, and we will announce further details at the Budget.
David T. C. Davies
Last year, Caffé Nero managed to make £20 million of profit and pay not one single penny in corporation tax, unlike many hard-pressed local businesses, such as dairy farmers. Does my hon. Friend agree that we might need to look at the rules on tax deductable interest payments and, in the meantime, support coffee chains that pay into the system and support their local businesses?
Mr Gauke
As my hon. Friend will be aware, Treasury Ministers do not discuss individual cases, but I can say that the Government are determined to ensure we have a competitive tax regime in which everyone plays by the rules and pays their fair share. We have been involved in a number of crackdowns on tax avoidance, both domestically and internationally, with the OECD base erosion and profit shifting projects, and we continue to work hard on that.
Barbara Keeley (Worsley and Eccles South) (Lab)
Well, it seems that the hon. Member for Monmouth (David T. C. Davies) does not have a lot of confidence in the measures being laid out by Ministers. Never mind percentages: the tax gap has increased to £34 billion. The US-Swiss tax deal raised £800 million in 2013, not the forecast £3.2 billion. Despite these failings, the Minister has just mentioned the manifesto promise to raise a further £5 billion. Will he start to tell us how he will do that? He has not even brought in tougher penalties on the general anti-avoidance rule.
Mr Gauke
The hon. Lady mentions the general anti-avoidance rule. As we have made clear, we are introducing specific penalties for tax avoidance.
In the last Parliament, HMRC’s yield rose from £17 billion to £26 billion a year, and, as I have said, the tax gap as a percentage has been lower in every year under us than it was in any year under the Labour Government. In the Budget, we will set out further details of how we will raise more revenue by dealing with tax evasion, tax avoidance, and aggressive tax planning.
Amanda Milling (Cannock Chase) (Con)
7. What fiscal steps he is taking to help people keep more of their earnings.
Christian Matheson (City of Chester) (Lab)
15. What assessment he has made of the level of productivity in the economy.
The Financial Secretary to the Treasury (Mr David Gauke)
The UK’s productivity has been lower than the G7 average since OECD records began 45 years ago. In the previous Parliament, we took a number of steps to increase the UK’s productivity in the long run, including cutting the corporation tax rates to the lowest in the G20 and investing in skills, infrastructure and science. The Chancellor will set out what further action this Government will take to boost productivity in our productivity plan to be published before the Budget.
Christian Matheson
I thank the Minister for his reply. In Chester, the number of people on apprenticeships continues to decline, and I am talking about Conservative-style cheap and cheerful apprenticeships with little added value at the end. Was the creation of a low-skill, low-wage economy an intention of the Government, or was it an unintended by-product?
Mr Gauke
On the subject of Chester, unemployment fell over the course of the last Parliament by 49%, which is something I would have expected the hon. Gentleman to welcome. The reality is that we are investing in apprenticeships; we saw 2.2 million people undertake apprenticeships in the previous Parliament, and we will increase that to 3 million in this Parliament.
Crispin Blunt (Reigate) (Con)
Following the crash, the remarkable record of the economy was that unemployment did not rocket up more post-2008 and 2009. Now, in my constituency, it is the labour market that is very tight. I ask the Front-Bench team to focus very hard on improving productivity because that is where the improvement in our economy must now come from.
Jo Cox (Batley and Spen) (Lab)
21. According to the Office for Budget Responsibility, if productivity growth per worker was closer to 4%, our national debt would be around £350 billion lower by the end of this Parliament. The OECD confirmed that continued weak productivity could lead to a higher than expected budget deficit. Why does the Minister not realise that his failures on productivity explain why we are doing so badly on bringing down the deficit?
Mr Gauke
I have said that productivity is important. One element of that is attracting more business investment into the UK. That requires a Government who are pro-business. I am not sure that the hon. Lady’s ambition to make the hon. Member for Islington North (Jeremy Corbyn) Prime Minister will help.
Kevin Hollinrake (Thirsk and Malton) (Con)
In 2010, according to the World Economic Forum, the UK had the second highest burden of red tape in the G7. By 2015, we have the lowest. Does the Minister agree that that alone will have a significant impact on productivity in the UK?
Mike Weir (Angus) (SNP)
T1. If he will make a statement on his departmental responsibilities.