Apart from first being elected to represent Newcastle North in 2010, my proudest moment has probably been seeing a proposal I put forward when still a backbencher become official Labour Party policy. Shortly after entering Parliament, I introduced a Bill which would see companies winning large public procurement contracts (worth over £1m) required to provide apprenticeship places as part of the contract. Despite winning cross-party support and the backing of a wide range of business and education organisations and trade unions, the idea was rejected by the coalition. However, I was delighted when Ed Miliband confirmed that a future Labour government would introduce the measure.
What is Labour’s approach to tax policy?
At a time when people, and businesses, are feeling the impact of austerity and a cost of living crisis, it is critical that a fairer taxation system is a priority of the next Labour government. We believe that this is crucial if we are to create the foundations for a sustainable, long-term recovery that is made by the many, and not just a privileged few at the top. That means building an economy to which everyone can contribute whilst providing support to those who need it most, rather than those with the broadest shoulders. And it means individuals and companies paying their fair share of tax, whilst clearly expecting those with greater capacity to pay more to do so.
So, for example, a current Labour government wouldn’t have prioritised a tax cut for top earners, but would be focusing any tax changes on improving living standards for low and middle income earners, and bringing down youth unemployment. And a future Labour government will reform the corporate taxation system so that it works properly in the modern world, delivers outcomes that are clearly and transparently fair, and ensures a level playing field for companies operating in the UK.
Labour is currently conducting a consultation on tax. Could you tell us a bit more about this?
The policy paper has been published as part of a series of other issues being considered by Labour’s ‘Your Britain’ policy review process, and is available online (see Labour’s Policy Review: Corporate tax – transparency and reform). It poses a number of questions on four key areas: HMRC; the general anti-abuse rule and how we could strengthen it; transparency and domestic reform. I will be hosting a series of roundtables as part of the consultation process on this paper, as well as taking on board every comment or idea that is put to me during the regular meetings and speaking engagements with key stakeholders that I have in my role as shadow exchequer secretary. I would also welcome hearing the views of Tax Journal readers, which can be sent directly to me via email.
Does HMRC have enough resource?
The huge cuts made to HMRC’s budget seriously risk being a false economy. Following the 2013 spending round, I have calculated that, between 2010 and 2016, HMRC will have lost 18,700 FTEs – or 26% of its staff. There’s no doubt the department has improved its performance in terms of compliance yield over recent years, and has also reported necessary improvements in customer service. However, this loss of staff is considerable and I believe HMRC faces a very significant challenge if this improvement is to be sustained as there has to be a limit to its capacity to do more with less. Of particular concern is the ‘demographic timebomb’ the Association of Revenue & Customs has warned about, with over half of HMRC’s workforce aged over 45, and 18% older than 55 – and almost half of those expected to retire between now and 2016 working in enforcement and compliance. It’s critical that the knowledge, skills and expertise of those currently working in such an important area aren’t lost.
Is there enough Parliamentary scrutiny of new tax law?
Having sat through what felt like several hundred hours of clause by clause scrutiny of the Finance Bill year at committee stage this year and last, I am inclined to say yes! And the technical briefings provided by expert bodies, whether the chartered institutes, or other interested parties, play an important role in helping MPs to interrogate and amend the legislation where possible.
Apart from first being elected to represent Newcastle North in 2010, my proudest moment has probably been seeing a proposal I put forward when still a backbencher become official Labour Party policy. Shortly after entering Parliament, I introduced a Bill which would see companies winning large public procurement contracts (worth over £1m) required to provide apprenticeship places as part of the contract. Despite winning cross-party support and the backing of a wide range of business and education organisations and trade unions, the idea was rejected by the coalition. However, I was delighted when Ed Miliband confirmed that a future Labour government would introduce the measure.
What is Labour’s approach to tax policy?
At a time when people, and businesses, are feeling the impact of austerity and a cost of living crisis, it is critical that a fairer taxation system is a priority of the next Labour government. We believe that this is crucial if we are to create the foundations for a sustainable, long-term recovery that is made by the many, and not just a privileged few at the top. That means building an economy to which everyone can contribute whilst providing support to those who need it most, rather than those with the broadest shoulders. And it means individuals and companies paying their fair share of tax, whilst clearly expecting those with greater capacity to pay more to do so.
So, for example, a current Labour government wouldn’t have prioritised a tax cut for top earners, but would be focusing any tax changes on improving living standards for low and middle income earners, and bringing down youth unemployment. And a future Labour government will reform the corporate taxation system so that it works properly in the modern world, delivers outcomes that are clearly and transparently fair, and ensures a level playing field for companies operating in the UK.
Labour is currently conducting a consultation on tax. Could you tell us a bit more about this?
The policy paper has been published as part of a series of other issues being considered by Labour’s ‘Your Britain’ policy review process, and is available online (see Labour’s Policy Review: Corporate tax – transparency and reform). It poses a number of questions on four key areas: HMRC; the general anti-abuse rule and how we could strengthen it; transparency and domestic reform. I will be hosting a series of roundtables as part of the consultation process on this paper, as well as taking on board every comment or idea that is put to me during the regular meetings and speaking engagements with key stakeholders that I have in my role as shadow exchequer secretary. I would also welcome hearing the views of Tax Journal readers, which can be sent directly to me via email.
Does HMRC have enough resource?
The huge cuts made to HMRC’s budget seriously risk being a false economy. Following the 2013 spending round, I have calculated that, between 2010 and 2016, HMRC will have lost 18,700 FTEs – or 26% of its staff. There’s no doubt the department has improved its performance in terms of compliance yield over recent years, and has also reported necessary improvements in customer service. However, this loss of staff is considerable and I believe HMRC faces a very significant challenge if this improvement is to be sustained as there has to be a limit to its capacity to do more with less. Of particular concern is the ‘demographic timebomb’ the Association of Revenue & Customs has warned about, with over half of HMRC’s workforce aged over 45, and 18% older than 55 – and almost half of those expected to retire between now and 2016 working in enforcement and compliance. It’s critical that the knowledge, skills and expertise of those currently working in such an important area aren’t lost.
Is there enough Parliamentary scrutiny of new tax law?
Having sat through what felt like several hundred hours of clause by clause scrutiny of the Finance Bill year at committee stage this year and last, I am inclined to say yes! And the technical briefings provided by expert bodies, whether the chartered institutes, or other interested parties, play an important role in helping MPs to interrogate and amend the legislation where possible.
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