Labour’s McDonnell hits out at tax regime that is asking less from Britain’s millionaire tycoons – and more from the rest of us.
LABOUR’S shadow chancellor branded the Tories’ stewardship of British tax affairs a “national disgrace” yesterday after it emerged the amount HM Revenue and Customs gets from the country’s highest-paid has fallen by £1 billion since 2009 — even though the rich have more money than ever before.
HMRC was accused of setting “one rule for the rich and another for everyone else” by a Commons public accounts committee report published yesterday.
Since HMRC set up a specialist unit for dealing with “high net worth individuals” in 2009 tax receipts have fallen by £1bn — but tax bills for the public rose by £23bn.
Mr McDonnell said: “The Tories have run a rigged economy where the super-rich pay less and less in tax while earnings for average working households are still below their level of a decade ago.
“It’s a national disgrace that the amount lost in tax from a super-rich elite under the Tories would be enough to help end the crisis in social care.”
An estimated 6,500 people worth £20 million or more have been assigned a “customer relationship manager” to administer their tax affairs.
But committee members said it was “alarming” that at any one time about a third of very wealthy individuals were likely to be under inquiry for unpaid tax.
And it said HMRC has a “dismal record” for prosecution of the super-rich over tax fraud.
In the five years to March 31 2016, HMRC completed just 72 fraud investigations into rich individuals and only one case resulted in a successful criminal prosecution.
The committee said existing penalties were too small to have an effect on multimillionaires.
HMRC warned the situation will get even worse as the rich switch from off-the-peg tax avoidance schemes — the “high street equivalent of Primark or Next” — to bespoke “made-to-measure Savile Row” arrangements.
Mr McDonnell pledged that Labour would “call time on the super-rich tax-dodgers and give HMRC the legal and staff resources it needs to close the tax avoidance loopholes and scams.”
A spokesman from Civil Service union PCS said: “HMRC has a battered reputation to restore and to win back public trust it has to get tougher on the super-rich and avoid looking like it is cosying up to them instead of cracking down.
“It will find this increasingly difficult if it ploughs on with plans to close all but a dozen of its 170 UK offices.”
A spokesman for HMRC said there was “absolutely no special treatment” for the wealthy. He said: “We give them additional scrutiny, with one-to-one marking by specialist tax collectors to ensure that they pay everything they owe, just like the rest of us do.
Posted by jeffrey davies on 28 January 2017
