Opposition Day debate: Tax avoidance and evasion

Tax avoidance and evasion

John McDonnell MP: "It's the poorest that are hit the hardest"

John McDonnell MP, Shadow Chancellor of the Exchequer opened the Opposition Debate on tax avoidance and evasion.

He said that with the budget in just over a fortnight, the Labour party will set out "an agenda of issues" that they believe the Government needs to address to tackle the social and climate emergencies.

Mr McDonnell mentioned the cuts to social care, local councils and emergency services, stating that "virtually every area of our public services is in crisis."

The Labour MP said that life expectancy has stalled, especially for women in deprived communities, due to these cuts.

Mr McDonnell said the Government "incapable" of providing the "care", "housing", "feeding" for people or providing "the work that will lift them and their families out of poverty".

He went on to say:

"All this suffering, all this hardship, all this holding back the potential of a near generation of our people would have been rendered completely unnecessary if we had a fair taxation system and we invested in our economy."

"A fair taxation systems starts with ensuring people and cooperation's pay their taxes. That patently is not the case at the moment."

Steve Barclay MP: "not all of the tax gap is due to malicious behaviour"

Steve Barclay MP, the Chief Secretary to the Treasury, responded to the opening of the debate by saying "there is a shared desire across the house to ensure the correct amount of tax is paid and that tax is not evaded".

He said since 2010 the Government has "introduced over a hundred new measures to tackle tax avoidance/evasion".

Mr Barclay assured the House that "our tax gap is at 5.6%, lower now than at any point before 2010 and one of the lowest in the world" and that "not all of the tax gap is due to malicious behaviour, it can also be due to basic errors".

He went on to say that "HMRC estimate that £10 billion of the current £35 billion tax gap is due to tax payer error rather than evasion or avoidance."

He concluded by saying:

"We all want to see the tax gap go down.

"But we continue to look at what measures can be taken.

It is in everyone's interest that we continue to crack down on evasion and avoidance and continue to narrow the tax gap. Doing so will allow us to invest in services, to level up and unleash the potential of every corner of the UK."

Motion voted against 

The motion text can be found on the Order Paper, on page 6.

The motion was voted against by 322 votes to 236.

• Watch Parliament TV: Opposition Day debate: Tax avoidance and evasion
• Read Hansard transcript: Tax avoidance and evasion

Image: Parliamentary Copyright

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