Unions up pressure to abolish 'super rich' tax breaks
TUC study says corporates and wealthy individuals skirt £25bn in taxes
Super rich corporations and individuals dodge a massive £25bn in taxes, a
hard-hitting study commissioned by the Trade Union Congress claimed today.
The research, compiled by high-profile tax campaigner Richard Murphy, found
that through various tax breaks and planning individuals were avoiding £13bn in
tax while large corporates were paying £12bn less than they should.
Analysis of the top 50 companies’ accounts shows that their effective
corporation tax rate is 22.5 per cent – not the 30 per cent agreed by
Parliament.
Individuals skirted tax by turning earned income into investment income and
shifting the income to others in lower or nil tax bands. Other strategies for
avoiding tax included moving moving transactions out of the UK and turning
income into a capital gain.
‘There is mounting concern at the growing gap between the super-rich and the
rest of society, but so far there have been few practical proposals to do
anything about it,’ said TUC general secretary Brendan Barber.
The TUC used the report as a launch pad to lobby for a minimum rate of tax to
be paid by all those earning more than £100,000 a year to limit their use of tax
avoidance and tax planning; a stop to HMRC staff cuts so that there are
sufficient resources to effectively collect tax, the abolition of non-dom
loopholes and for capital gains on assets held for less than a year to be
charged to income tax.
The TUC also wants to see a change to the tax treatment of charities to give
them more income and close a tax loophole and the introduction of a new ‘general
anti-avoidance principle’ to make it easier to tax the super-rich and large
companies.
Further reading:
UK’s super-rich dodge £13bn in tax