Finance Bill

Debate between Stella Creasy and David Gauke

Monday 1st July 2013 Commons Chamber

[Mr Gauke]

I would say—I think that this is the most tactful way of putting it—that the Government are determined to send the signal that the UK is open for business. That is how we can win the global race. Other Governments might wish to take other approaches, and that is for them to decide. For the UK, we believe in open markets and a competitive tax system—but a tax system, none the less, in which businesses pay the tax they should and in which economic activity is properly taxed.

We have made a commitment to act and have backed that up with extra resources for the OECD. The UK has been actively participating in the development of the OECD’s comprehensive action plan for tackling such issues, which will be presented to the G20 later this month. It might interest hon. Members to know that at the recent Lough Erne summit the G8 called on the OECD to draw up a common template for multinationals to report to tax authorities where they make their profits and pay taxes around the world. That will give tax authorities a new tool against tax avoidance to help them efficiently identify and assess risks, but requiring publication of that information would put the UK at a competitive disadvantage to other countries that did not require publication. It would also impose costly administrative burdens on business and Government.

The new clause proposed by the Opposition would require all multinational companies to report all their UK corporation tax payments—not just tax related to the GAAR, but the whole of their UK corporation tax. That goes way beyond the clear policy that we have set for the GAAR and would risk giving an impression that the GAAR has an impact on all corporation receipts, creating the sense of uncertainty about the impact of the GAAR that we have gone to some lengths to avoid.

[Stella Creasy (Walthamstow) (Lab/Co-op)]

I am interested by the Minister’s comments. The Minister has concerns about publishing such data, but in other cases the Prime Minister extols sunlight as the best disinfectant. Is it not important, if the public are to be confident in our tax system, for them to have such information? Why does he feel that tax receipts should be exempt from that disinfectant process?

[Mr Gauke]

There is a long-standing and widespread approach that tax is a matter of confidentiality between taxpayers and the tax authorities. I say that the approach is long standing; it is the approach we have had in the UK for time immemorial.



It is also the position that applies in pretty well all major economies, and if we were to change that approach, it would be sensible to do so multilaterally. If we introduced a requirement that multinationals based in the UK had to publish information in a way that would not apply if they were based elsewhere, that would raise questions about the attractiveness of the UK as a place in which to do business.

On how to move forward in this area, I would make the wider point that we work multilaterally. That approach was endorsed by Tony Blair, who, in a recent interview, said that if countries move unilaterally, others will eat your lunch, to put it bluntly. I think that was the phrase he used. It is right that we work with other countries to ensure that we have an effective tax system, but I would not favour measures that left the UK isolated in such a way.

National Insurance Contributions Bill

Debate between Stella Creasy and David Gauke

Thursday 13th January 2011 Commons Chamber

[Mr Gauke]

Of course the Treasury examined all these matters in respect of its policies as a whole, its budget announcements and so on. I must point out that although the excluded region as a whole is diverse, the areas that will be included are equally so. I am not strongly persuaded by the arguments that have been made about this being discriminatory. When listening to these arguments, I was struck by the fact that it is worth reminding the House of what we are seeking to do. We are seeking to reduce the amount of NICs that will be collected, because we believe that in the way that we are doing so, we will be able to help to encourage business—

[Dr Creasy]

rose—

[Mr Gauke]

I want to develop this point, but I shall give way after I have done so. We want to encourage the creation of new businesses and more jobs. That issue has been raised in some of the earlier remarks. The hon. Lady discussed the importance of jobs and the hon. Member for Ilford South (Mike Gapes) discussed the impact that failing to reduce NICs might have on the Thames Gateway. The conceit of the speech made by the right hon. Member for East Ham (Stephen Timms) was that there was some division between the Treasury and No. 10. I do not know whether he was thinking of his own lengthy period in the Treasury rather than of the current circumstances, but let me assure him that there is no great tension between the Treasury and No. 10. I know that that has not always been the case in recent years.