Starbucks, Amazon, Google; these are all companies that have become mainstays of the high street, or omnipresent when we log onto our computers.
However, in recent weeks, for many of us they have become known for altogether different reasons and reasons which, when hard working families in my constituency or small businesses in Broad Street for example are paying the taxes they owe, find morally unacceptable – namely, tax avoidance.
The harsh reality is that while evading tax is illegal, avoiding tax is, while certainly morally questionable, not. It is not just companies, it is also very wealthy individuals, and for far too long it has gone on unabated.
The 2010 Lib Dem manifesto was very clear on this with page six committing us to close tax loopholes to fund a tax cut for those on the lowest income.
Page 14 states: “we will tackle tax avoidance and evasion, with new powers for HMRC”.
Page 62 states: “we will crack down on tax havens”.
In September 2010 my Lib Dem colleague Danny Alexander announced £900 million to tackle tax avoidance and evasion. As a result, we have seen prosecutions for illegal tax evasion up 80%, and are on track to have got back nearly £4billion by the end of this year.
However, with crafty accountants constantly trying to find new ways to avoid their clients from paying tax, we must not stand still. The Autumn Statement sent a clear message to tax avoiders and evaders – we are coming after you.
The Statement included: Increasing the fund to tackle avoidance and evasion to over £1billion - bringing in £9billion; The introduction of the first ever General Anti-Abuse Rule; Confirmation of an agreement with Switzerland to reclaim tax on hidden money, bringing in £5billion over the next six years; A commitment to create an off-shore tax evasion strategy; 2,500 more tax inspector to go after avoiders and evaders; Ring-fencing HMRC’s budget; Making the prevention of artificial transfer of profits to tax havens an important priority of our G8 Presidency next year.
Starbucks has taken the decision to review their tax practices in the UK, which is welcome news.
But to be frank, we cannot merely rely on the moral conscious of evaders and avoiders to kick in, we need to ensure they are forced to and we are doing just that.
Tax cuts for the lowest paid, clamping down on tax avoidance and evasion, that is the right approach and that is the Lib Dem approach.