Thank you for getting in touch with me about fairness in our tax system, and specifically to ask about the Pirate Party’s plans to crack down on tax dodging.
Millions of us have just finished our tax returns, doing our bit to support the NHS, education and pensions. We in the Pirate Party, like you, expect both business and wealthy individuals to do the same.
Of course we know that hasn’t been the case. Just the tax avoidance by Boots over 6 years would have paid for a staggering, and much needed, 78,000 nurses. HMRC have successfully recovered a further £135Mn from wealthy individuals based in the UK who were abusing the Swiss secrecy rules with HSBC.
It is important to note that there are two different, but related issues here that need to be tackled in different ways:
Tax evasion is the illegal paying of less tax than you should do – the most public examples of this being wealthy individuals with banks such as HSBC in Switzerland not declaring Income or Capital Gains that should be declared, and thus artificially reducing their tax bill.
Tax evasion is already illegal – and so claiming that as politicians we can ‘clamp down’ by passing additional laws is unhelpful. Instead, I would be looking to work with Civil Service and HMRC to both improve the recovery rate when dealing with those who have evaded tax, but also to ensure that those accused of assisting are also punished to the extent of the law. This means ensuring that HMRC pass details to the police as applicable, rather than live in a ‘silo’ where they focus only on recovery of tax without considering the wider implications.
By contrast, Tax avoidance is the legal use of complicated loopholes set up over many years of budgets and laws. That’s why it’s right that you come to all of us who are standing for parliament. That’s our responsibility to fix.
As a Pirate Party MP I would be very happy to support legislation that cracks down on some of key dodges which means corporate giants can move money out of the country. Big companies like Star-bucks pay a “royalty” to themselves for using their trademark, which means they can pretend they have made no profit, when in fact they are just paying themselves. Let’s stop using royalties and ‘intellectual property’ to dodge taxes.
(For here for a good example of how this works)
This is just one of the more obvious examples though – the truth is that tax law is hugely complicated. If anyone has told you it can be solved with one bill they are giving you false hope. Instead, you will need someone like me who will be happy to challenge each budget, each loophole, each international agreement as and when they come up – in order to ensure that corporations don’t just switch from abusing one loophole to another.
One unique Pirate Party policy that would get us tax justice is to have a dedicated tax minister. They would be focused on simplifying tax law – corporations slip through the complications. It is noticeable that one of the things that the Coalition Government set-up was the Office of Tax Simplification – whilst this was good in principle, the politicians have just taken a few ideas from it, and have ignored the rest. By contrast, our dedicated tax minister would be there to make sure that legislation was enacted to truly simplify tax law and enable us to deliver the income we need as a country in a just way.
Furthermore, we are well aware that individually we will not have all the answers, but collectively we will do. The Pirate Party is based on the principle of crowd-funding ideas, and that is why we really want to hear from you.
Please get in touch with your thoughts as to what more we should be doing – on this or any other issue – we genuinely want to listen to your thoughts.
Mark Chapman, Pirate Party PPC for Vauxhall
The above is the essence of a response that I have given to people who have got in touch asking what I, and the Pirate Party would do to crack down on tax dodging. It is replicated here in the spirit of openness and transparency and with any identifiable reference to an individual removed.