Tax Avoidance

Debate between Steve McCabe and Shabana Mahmood

Wednesday 11th February 2015 Commons Chamber

[Shabana Mahmood]

The hon. Gentleman is completely missing the point about the debate we have been having this week about the HSBC affair. As I said in answer to the intervention from the hon. Member for Wyre Forest (Mark Garnier), we know that data with evidence of tax avoidance and tax evasion were handed over to the Government in May 2010. That raises serious questions about due diligence and the appointment of Lord Green, the man in charge of the bank at the time, as a Minister in this Government only eight months after the data were handed over. Nobody on the Government Benches has answered the point about why that happened, and I hope that the Minister might try to answer some of those questions today.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

When David Hartnett said that the whole nation knows we had our disc from the Swiss, is it conceivable that he meant that everybody but the Prime Minister? Or is it the case that rather than sunlight being the best disinfectant, the stench from Downing street would knock over a horse?

[Shabana Mahmood]

My hon. Friend makes a powerful point. I agree and I shall come on to that a little later in my speech. We have had an ever-moving, ever-changing story about what the Government or members of the Government knew or did not know and the questions that they asked or did not ask about HSBC. That goes to my central issue of trust: trust is being undermined in our tax system, which absolutely depends on it.

The Government have tried to trumpet their record in recent days, but I am afraid that it is not the great source of pride that they have been trying to pretend it is. We know that the tax gap—that is, the difference between how much tax should be collected and how much is collected—rose from £31 billion in 2009-10 to £33 billion in 2011-12 and now to £34 billion in 2012-13, which is the information available for the latest year.

Stamp Duty Land Tax

Debate between Steve McCabe and Shabana Mahmood

Thursday 4th December 2014 Commons Chamber

[Shabana Mahmood]

I find it interesting that Government Members are happy to plead global circumstances to explain their failures in Government yet conveniently forget that we had a global financial crisis in 2008. I think the hon. and learned Gentleman made that point in a slightly petty way.

[Steve McCabe]

If we are supposed to have recovered from the recession, why is house building now at its lowest level since the 1920s? To me, that sounds like a failure rather than a success.

[Shabana Mahmood]

My hon. Friend is absolutely right. The Government said in their autumn statement that everything was on course. If the finances are in such a good state, why will they not adopt an ambitious programme of house building? Until we have action on the supply side, we will not be able to get to grips with this lop-sided housing market.

We need to get more homes built, and we also need to deal with the underlying causes of the crisis. For example, we know that too much land is being held as a speculative investment even though local people need homes, and that the trickle of new developments that are being built are snapped up long before people from the area can benefit from them. We also know that our country’s capacity to build homes has shrunk drastically. Fifty years ago, the public and private sectors between them built more than 300,000 homes a year; now we rely on a small number of volume house builders and, as a result, we build far fewer homes.

A number of measures are needed to deal with the underlying causes of the housing crisis and to get the number of homes built that this country needs. We have proposed new powers for local authorities, as well as a help to build scheme to run alongside the Government’s Help to Buy scheme, which we support. We particularly want to see an increase in the role of small and medium-sized construction firms, because the resulting diversity in the market would help to get more homes built and deal with the underlying causes of the crisis. As I have said, we need to see supply-side measures in conjunction with the proposals on stamp duty and the Help to Buy scheme. That would help us to get to grips with the crisis and arrive at a position where the dream of home ownership was not so far out of the reach of our constituents across the country.

I also want to mention our proposal for a tax on high-value properties—the so-called mansion tax. We believe that that is a necessary measure to get an annual sum of money into our national health service, which is in crisis and in desperate need of further, stable funding. It is interesting that the Chancellor has accepted, in his stamp duty proposals, the principle that very high-value properties in this country are under-taxed. Earlier in this Parliament, he introduced the annual tax on envelope dwellings—the ATED—which is described as a kind of mansion tax for high-value properties held by companies in a corporate envelope. Now, the Government are characterising the new stamp duty changes as their version of a mansion tax. I wonder why, as they creep towards an actual mansion tax, they will not make that final leap and simply adopt our proposal, thereby guaranteeing an annual sum for our national health service.

The Prime Minister is reported to have remarked some time ago that the Government could never introduce a mansion tax because the Conservative party’s donors would not accept it. I wonder whether that is the only thing holding the Government back. The truth is that they should go further and adopt our proposal. There is a difference between what they are doing today and our proposal. Stamp duty is a transaction tax, but our tax on high-value properties would be an annual charge that would provide a stable source of revenue for the national health service.

One of the Government’s regular criticisms of our proposal is that it would hit those who were asset rich but income poor. However, we have already set out how that could be dealt with through a system of deferral for anyone with an income of less than £42,000 a year—in other words, a basic rate taxpayer. That would be a perfectly sensible and adequate way of helping those people. We could then fairly and progressively introduce a tax that would help to get the national health service’s finances back on track.

Finance Bill

Debate between Steve McCabe and Shabana Mahmood

Tuesday 1st July 2014 Commons Chamber

[Shabana Mahmood]

I fear that on previous form the Government will not listen today and accept our new clause. Nothing that has been said in previous debates gives me any confidence that they understand the message that they have sent to my hon. Friend’s constituents, mine and those of Members across the House that a tax cut for the wealthiest is prioritised, while ordinary working people at the lower end of the income scale are worse off.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Does my hon. Friend share my worry that people will think the Government have something to hide, as they are unwilling both to let us see what a 50p rate would raise and to audit party manifestos? Rather than “We’re all in it together,” does it not sound like they are all at it together?

[Shabana Mahmood]

My hon. Friend makes a powerful point. What do the Government have to hide? The data that we seek would not be difficult for HMRC to provide. It has already conducted one analysis and it is not unfeasible for it to conduct a further analysis, this time based on more comprehensive data, which would clear up some of the issues once and for all.

--- Later in debate ---

[Shabana Mahmood]

My hon. Friend is right.

The Government always tell us how proud they are of their record on tax avoidance, but how much effort did they put into thinking of ways in which they could protect revenue from the 50p rate? The Government have introduced the general anti-abuse rule, the so-called GAAR, which may have helped. They could have thought about a targeted anti-avoidance rule, a so-called TAAR. They could also have looked to HMRC to do more. I understand that no specific resources are allocated within HMRC to protect revenue from the 50p rate. A range of measures could have been taken to protect revenue. Before rushing to abolish the rate, the Government could and should have looked at protecting that revenue first. They were quick enough to publish an analysis saying that on their evidence it was not raising much money because of behavioural change, but their instinct was not to say, “Let’s look at how we might see off that behavioural change.” They did not commission a report or publish anything on that; they jumped straight to cutting it at the earliest opportunity: more evidence that this is an ideological and political choice made because they wanted to prioritise the tax cuts for the richest, while ordinary working people are worse off.

[Steve McCabe]

Far from trying to curb tax avoidance, is not the problem that the Govt constantly open up fresh opportunities, such as the shares for rights, which the Institute for Fiscal Studies has called another billion-pound lollipop on the table?

[Shabana Mahmood]

My hon. Friend is absolutely right. We will debate later the issues in relation to tax avoidance and shares for rights.

West Midlands Police

Debate between Steve McCabe and Shabana Mahmood

Tuesday 18th January 2011 Commons Chamber

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Thank you for granting this Adjournment debate, Mr Speaker. This is my third encounter today with the Minister for Policing and Criminal Justice. I assure him that I am not tiring of it, even if he might be getting a little fed up with the sight of me. I am glad that a number of colleagues have stayed for the Adjournment debate, which shows their concern about this issue.

Alongside many of my west midlands colleagues, I have spent quite a bit of time recently discussing the likely effects of cuts and reductions in policing. We have talked with the Minister, shadow Ministers, police officers of various ranks, members of the police authority and other key stakeholders. We all know that reductions in police funding are going to be at their worst in places such as the west midlands, and that there may well be consequences that have so far been overlooked.

Inevitably, talk of police cuts leads to discussions about the risks of rising crime and arguments over how the police use their time. Depending on the audience, it is not uncommon for young people to figure in the discussions, as if they are a major cause of crime and antisocial behaviour and the entire nature of their relationship with the police is one of conflict. I do not accept that—hence tonight’s debate. It is easy to forget that the police are often the first port of call for worried parents when youngsters go missing or run away from home, when youngsters fall into bad company or when parents feel they are losing control. In my constituency of Selly Oak, it is common to see the police playing an active role in working in schools and youth clubs. They take a very hands-on approach.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

Does my hon. Friend agree that school-based police officers are crucial and make a huge difference that is noted by parents, teachers and local residents and, in particular, by students themselves? He might be interested to know that I was lobbied last week by year 7 and 9 pupils from Small Heath school in my constituency—incidentally, it is my former school. They were lamenting the loss of their local police constable, PC Inglis, who had been based at their school for a number of years and had made such an impact on the students and on antisocial behaviour, the rates of which had declined significantly.

[Steve McCabe]

I agree with my hon. Friend. At Highters Heath school, it is not unusual to see officers taking part in lessons or accompanying children on school trips. That is part of a project developed by the head teacher, Jan Connor, in conjunction with her local police inspector and sergeant. They recognised that contact with the police had to be about more than warnings, inquiries or witnessing arrests, so they set out to break down the barriers and build a long-term relationship with the community. That is important, but it will be hard to measure when the accountants want to balance the books. As with my hon. Friend, the young people and constituents whom I speak to tell me that it is making a difference.

I often get complaints from constituents about antisocial behaviour on the Chinn Brook recreation ground, especially during the lighter nights. The solution in the old-fashioned, vehicle-led reactive policing days might have been to send out a car and issue a few warnings or round up the loudest. That does not really solve the problem and risks alienating young people from the police.

Last summer, I attended a barbecue organised by a local inspector and a sergeant and her team. They sent invitations to families across the area. They made it clear that the recreation ground could be used for fun and family events, but that it had to be shared and the needs of others respected. They worked hard to sign up every youngster who attended for a sports challenge or some other activity to keep them busy on summer nights. That is the kind of policing that my constituents want, and it is the kind of policing that pays dividends with young people.

West Midlands police have been one of the pioneers of a return to what is sometimes called autonomous or common-sense policing, whereby the police set out to resolve community conflicts, antisocial behaviour and sometimes intergenerational tensions by using their guile and common sense, rather than boosting their arrest figures. Using that kind of policing, minor vandalism can be dealt with by perpetrators putting right the damage, or a punch-up in the school playground not automatically being recorded as an assault. For me, that is the foundation of neighbourhood policing.

Many years ago, when I worked with young offenders, I can well remember the juvenile court packed with cases that might have been dealt with differently with a bit more common sense and desire for a just solution. That is why I am anxious to protect this model of policing. I am not alone in that view. More than 600 of my constituents have been in touch with me to express their anxieties about what might happen if there is a huge reduction in officers and less time for community engagement.