Tax Fairness

Lord Jackson of Peterborough Excerpts

Tuesday 12th March 2013 Commons Chamber

[Nic Dakin]

The hon. Gentleman will be alert to the fact that I came into this House only in 2010. We can all look back with hindsight and be critical of decisions made at different times. One of the issues for us all in these difficult times is whether with hindsight on the decisions we are making today people will say we made the right decisions.

[Mr Stewart Jackson (Peterborough) (Con)]

Why does the hon. Gentleman think that between 1998 and 2010, in a period of sustained economic growth, the welfare bill under the party he supports went from £53 billion to £111 billion? Does that not speak to a failure to tackle endemic issues of welfare dependency, which this Government are addressing?

[Nic Dakin]

The hon. Gentleman might not have noticed, but this debate is focused on fair taxes. He is right to draw attention to other things, but you would bring me to order, Mr Deputy Speaker, if I were lured down that route.

--- Later in debate ---

[Kelvin Hopkins]

Yes, that was absolutely regrettable. I know that my party will commit to introducing a cap on bonuses in our first few days in power after the next election.

[Mr Stewart Jackson]

The hon. Gentleman always makes a powerful point. Having served on the Public Accounts Committee and on the ongoing inquiries into tax avoidance, I concur with him. I am a defender not of crony capitalism but of popular capitalism. He might not agree with me on that, being slightly on the left. In order to tackle corporate tax avoidance, we need to look at multilateral, bilateral, international and domestic legislation, but would he acknowledge that the previous Government flunked every opportunity to look at those issues over 13 years?

[Kelvin Hopkins]

We have seen successive Governments going in for what is called light-touch regulation on all fronts. I have never believed in light-touch regulation; I believe in tough regulation. I believe in employing thousands more tax officers to ensure that we collect the taxes. At the beginning of my time in Parliament, I visited our local VAT office, and the inspectors there told me that if they had more tax inspectors, they could collect billions more in tax. Each of those VAT inspectors collected more than five times their salary. I wrote about this to the Chancellor of the Exchequer at the time, and got a letter back from a civil servant saying that the Treasury was trying to reduce costs by reducing staffing levels. That was a completely illogical non sequitur; it was complete nonsense. Reducing the number of tax officers will reduce income by more than the amount of their salaries.

I have made the point many times—and I shall continue to make it—that we need more tax officers and more rigorous regulation. We need more control over what the corporates and the fat cats get away with. The reality is that ordinary working-class people have to pay tax through PAYE. They cannot escape paying their tax, but the corporates and the fat cats can. So, I have agreed with the hon. Member for Peterborough (Mr Jackson) on one or two issues, and I am pleased about that, although we have different philosophical views when it comes to economics.

I want to talk about the deficit problem, because that is what taxation is about. I do not think that we actually have a deficit problem. We do not even have a spending problem. We have a revenue collection problem. That can be addressed either by collecting tax in the way that we do now, or by changing tax rates, as proposed in today’s motion.

Tax collection is a serious problem, and we could make serious changes there, but I want to look back to a time when taxes were more progressive. During the previous Parliament, I made suggestions in this Chamber about the kind of tax changes that I wanted to see. I went beyond what our leadership is now suggesting, although I welcome its proposals. I think we should go further, however. In the 1970s, Denis Healey was Chancellor of the Exchequer. He said that he wanted to

“tax the rich until the pips squeak”.

I cheered him for that, and we did not lose any votes because of his statement. In fact, a lot ordinary working-class people said, “Quite right too! We want those who can afford to pay more to do so. Those who can only afford to pay less should pay less.”