Ending Corporate Tax Avoidance

For our local economy to thrive it’s vital that local businesses are not disadvantaged for playing by the rules on tax, whilst larger corporations avoid paying their fair share.

On Thursday evening the full council met for its bi-monthly formal meeting. As we’re still quite early in the municipal year we haven’t yet got into the perennial process of budget-setting, which tends to dominate the latter half of the meeting cycle. That means that the agenda of the council meetings can be quite fluid, affording elected members, and indeed members of the public, the opportunity to raise issues they feel are important. One privilege afforded to elected memebrs (i.e. councillors) is the chance to bring a ‘motion’ before council. Previously I’ve seconded a motion brought by another councillor, but this was the first time I was in the position of proposer.

What are motions anyway? Within democratic bodies such as council, parliaments, and also at formal gatherings like corporate shareholder meetings, motions are a way to formulate a collective opinion on a matter. The motion itself is a form of words that express a desire to do something about something. Once the motion is presented, via a speech from its proposer, there’s a debate about it. Some members will express agreement, others disagreement. Once the debate has run its course the Chair of the meeting will call for a vote. If the majority of members vote in support of the motion then it has passed, and the body is committed to whatever action the motion proposed.

The motion I brought related to the Fair Tax campaign. I brought the motion because, as we all know, the public finances were under substantial pressure even before the covid-19 pandemic hit. I’m convinced we must do whatever we can to support economic recovery, and one important thing is therefore to ensure that the major players in the economy play by the rules and pay their fair share of tax. Research has revealed that around 17.5% of public contracts in the UK have been won by companies with links to tax havens. It is conservatively estimated that this could be costing the UK at least £7bn per year in lost revenue.

That’s £7bn a year that should be paying for really important things like education, health and social care, flood defences, roads, policing, and much more besides. Polling by the Fair Tax Foundation found that two-thirds of the public agree that when undertaking procurement (buying-in goods and services) the Government and local councils should consider a company’s ethics and how they pay their tax.

I know that every time another news story emerges about big corporation using a clever trick to get out of paying their taxes, local people get angry about it. Rightly so. You want to see action. Well, I’m pleased to say that council voted FOR the motion. I believe this represents a modest but important step in turning the tide against corporate tax avoidance.

I’d be interested in what you think on the issue. You can leave a comment on my Facebook page.

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