A young man in my constituency recently had his Job Seekers Allowance stopped. He was sanctioned for missing an appointment – even though the JobCentre were aware of the health condition behind his absence.
Like many vulnerable people he was hit by the Government’s target-driven sanctioning regime.
Compare that with the recent news about HSBC. In May 2010 the Government received the names of 1,100 super-rich people. They were all using HSBC bank accounts in Switzerland to avoid or evade tax. But just one of these people has been prosecuted.
Both of these examples make me angry, but what infuriates me is when you compare the two. The Government goes to great lengths to sanction the benefits of vulnerable people. Yet they’ve turned a blind eye to massive tax avoidance by the wealthy and the powerful. I challenged Treasury Ministers on these double standards last week.
In preparing my questions, I asked the House of Commons Library for official figures on tax dodging and welfare spending. They told me that tax avoidance and tax evasion cost the country a staggering £7.2 billion in 2012/13. Billions that could have gone into the NHS, the police or other vital services. In the same year £5.2 billion went on Job Seekers Allowance (JSA). To put that another way the Government wrote off £2 billion more in lost taxes than the entire JSA budget.
Tory and Lib Dem Ministers love talking tough on welfare, but it’s easy to pick on the vulnerable. They say little, and do even less, about the people who take us all for a ride – the wealthy individuals and companies who dodge their taxes. This is unacceptable, especially when cuts are being made to our local and national services. Doesn’t this say everything about the Government’s priorities?
So here’s what Labour will do. We’ll make sure HMRC apply the same tax rules to everyone, no matter how rich or powerful. We’ll close loopholes that let companies and hedge funds avoid tax and we’ll stop places like the Channel Islands from operating as tax havens.
This Government has failed to act, but Ed Miliband has made it clear that tackling tax dodging will be a key priority of a future Labour Government. Everyone, especially the wealthiest, must pay their fair share.