Tax Avoidance

Lord Livermore Excerpts

Wednesday 29th April 2020 Lords Chamber

[Lord Agnew of Oulton]

My Lords, all the support that we have offered has been aimed at keeping businesses going and securing employment, mostly through the furlough scheme. While I take on board the noble Lord’s concerns, I believe that the rapid action that we have taken, which has to be general by the definition of the time period that we have had to operate in, has helped to secure businesses’ long-term future, which is our priority.

[Lord Livermore (Lab)]

My Lords, many other countries have set out strict requirements to prevent state support enabling not only tax avoidance but excessive executive pay and high dividend payments. Do the Government support a moratorium on dividend payments and share buybacks for companies that receive state support, and will they introduce specific rules to prevent tax-avoiding companies benefiting from government schemes?

[Lord Agnew of Oulton]

I assure the noble Lord that all these things are continuously under review. As I mentioned briefly in the previous Question, we have introduced in days things that could often take years, so by definition we are keeping a very careful eye on them. To give the noble Lord some reassurance, with most of these loan schemes, businesses have to show that they are viable, and if they are going to continue to pay dividends the banks will take a view on that and decide whether it is appropriate. These are not automatic entitlements; they have to be justified.