Turn the tables and make the rich pay.

[Thinking Man's Idiot]

A fairer solution

(Thursday 20 November 2008)








PAUL HASTE reports on a campaign to turn the tables and make the rich pay.



IN the face of wealthy financiers demanding multibillion-pound bail-outs to protect their share dividends and bosses throwing thousands of workers on the dole to save their profits, activists have started a fightback for a fairer solution to the economic crisis.

Left Economics Advisory Panel chairman Labour MP John McDonnell hosted a "Closing the tax gap" rally at Parliament on Tuesday as part of a new offensive to expose the tax-dodging rich and to demand a more equitable society.


"TUC research has revealed that companies and the wealthiest individuals in our society are deliberately avoiding paying tax worth more than £25 billion," Mr McDonnell said.


"These missing billions should be reclaimed and, together with the funds from a more progressive tax system, should be used to fund public services."


Tax Justice Network director Richard Murphy detailed how Britain's largest companies were literally hoarding cash in banks on Caribbean islands - starving public funds of the money needed to run hospitals and pay an adequate state pension.


"Tax avoidance by these corporations is deliberate and intentional," he declared.


"Complaints about a 'huge tax burden' by their friends in the financial press should be treated with scepticism, because the actual tax they pay is really only about 22 per cent instead of the 30 per cent they should be paying."


Mr Murphy highlighted how many wealthy dodgers take advantage of tax havens' lack of transparency to hide their money in secret bank accounts.


"An incredible $11 trillion (£7.4tr) is thought to be squirrelled away in these havens, many of them islands that are British Crown dependencies such as Bermuda, Jersey and the Cayman Islands in the Caribbean," he explained.


"Such an amount hidden away denies the governments of the world a collective $255 billion (£172bn) in tax revenues, which is more than two-and-a-half times the world's entire aid budget."


Mr Murphy added: "In Britain alone, the amount lost to tax avoidance each year is enough to fund 100 hospitals or raise the state pension 20 per cent. And just one-quarter of the cash lost could fund a pay rise for five million public-sector workers that is equivalent to the rise in average earnings."


Civil Service union PCS general secretary Mark Serwotka pointed out that new Labour "claims it is serious about combating poverty and inequality, yet ministers preside over a tax system that allows the wealthy to pay little or no tax.


"No wonder that even the International Monetary Fund has described the UK as an 'offshore tax haven' for the world's super-rich," he said.


Mr Serwotka urged the government to impose a new tax rate on those earning more than £100,000 a year and to ensure that "the wealthiest do not benefit from tax allowances that society cannot afford to give them."


But, to enforce such policies, the civil servants' leader also demanded that ministers reverse thousands of job cuts in the Revenue and Customs service and lift the threat to cut even more jobs.