Finance (No. 2) Bill — House of Commons, 2017-12-19
Topic: Macroeconomics
Anneliese Jane Dodds (Labour, Centre-left): It is a pleasure to serve under your chairmanship, Sir Roger First, let me respond to the Minister’s comments. I said before that it feels a little like groundhog day, although that is in February rather than at Christmas time. While I have a huge amount of respect for the Minister, and I am very grateful for his gracious comments, I suggest that in a moment he may be in the position of the Mayor of Wisconsin, who, he may remember, was nipped by the groundhog on groundhog day. I fear that the Minister is going to be nipped slightly after saying that Labour in government did very little on tax avoidance and tax evasion. He will be very much aware, because I have said this many times to him and to other Government Members, of the huge role that was played by Dawn Primarolo when she chaired the Code of Conduct Group. [Interruption.] The hon. Member for Beverley and Holderness (Graham Stuart) makes a comment about the tax gap. We have already discussed some of the conflicts around the calculation of the tax gap, such as the fact that, sadly, it does not include international profit shifting. If it did, we would have a much larger tax gap I have mentioned the role of Dawn Primarolo, for Labour, chairing the Code of Conduct Group, which identified, published and eliminated 68 harmful tax measures. I can now reveal that there is much, much more that Labour Governments did. Perhaps, regrettably, the Minister has not been given sight of the letter to the Chancellor by my hon. Friend the Member for Walsall South (Valerie Vaz), the shadow Leader of the House. When she asked the House of Commons Library exactly what Labour Governments had achieved in the field of tax avoidance and evasion, it provided very full information, which she has sent on to the Chancellor. The Library made it very clear that under Labour Administrations there were 14 Budget reports, each of which included measures on preventing tax dodging. As well as those instances of action, there was the introduction of the disclosure regime and the Primarolo statement, which, in practice, revolutionised HMRC’s ability to tackle tax dodging. Labour Members will not take lessons from Government Members when we have a strong record in this area The Minister did not make clear what the Government’s approach will be to the inclusion of business-like trusts in registers of beneficial ownership, as is now EU policy. Will that be the UK’s policy? That has been resisted by Conservatives so far; I hope that they will now change their tune. He also did not enlighten us on his opinion of the legal action that is being taken against a British newspaper and the British Broadcasting Corporation because of their revealing the reality of international tax planning by some actors who are giving others in that area a terrible name. I regret that he did not respond to my direct questions on those matters I would like to respond briefly to comments made by other Members. The hon. Member for Cheltenham (Alex Chalk), when asked about whether HMRC’s figure on the tax gap included international profit shifting, refused to respond, sadly. I want to respond to the point about whether the Finance Bill protects governmental revenue. I do not want to go over the debates that we had yesterday and the many comments made by Labour Members, but I regret that in their new approach to the bank levy—reducing its rate and scope, and imposing an inadequate surcharge—the Government have decided voluntarily to reduce by a third the funds that come from the banking sector. Conservative Members can broadcast as much as they like about the additional tax that has arisen because of the banks’ profitability, but that is a natural consequence of the British economy’s return to profitability after the financial crisis. In practice, the Finance Bill does not act up to those goals in any sense My hon. Friend the Member for Luton North (Kelvin Hopkins) has campaigned on tax transparency for many years, and he made several prescient points. The hon. Member for Aberdeen North (Kirsty Blackman) referred to the personnel challenges being experienced by HMRC. They are of enormous concern, as she said, in the context of Brexit, as a result of which we may have more customs challenges. There has been a substantial reduction in HMRC’s headcount of, I believe, around a fifth since 2010. I take on board the points that the Minister made about having the right capabilities and the right technical facility. However, when I look back at the Home Affairs Committee’s discussion of whether HMRC would be ready with the new CHIEF system and have the capability to deliver it, I am filled, I am sad to say, with concern rather than confidence At this point, I will finish my remarks by commending to the Committee our new clause, which asks for a review of the provisions and whether they genuinely tackle tax dodging. Question put, That the clause be read a Second time.