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A New Way to Tackle Tax Avoidance

This is a guest blog kindly provided by Emily Kenway from the Fair Tax Mark campaign

If you care about equality, you need to care about tax. Firstly, and most obviously, when companies avoid paying the right amount of corporation tax, it’s bad for our public purse. It means less money for those vital services we all need, like the NHS and education. In fact, the £3.7 billion annually which HMRC estimates is missing from corporation tax payments would be enough to pay 171,000 nurses’ starter salaries for a year, or to cover 9,250,000 days in hospital. These public services are the foundation of equality in our society: open to all, accessible by all, they ensure a baseline of care for everyone, regardless of their characteristics or economic status. Tax is a lever for equality; who we tax, when, how much and why represents the kind of society we’re seeking to build. Done well, it can help to ensure privilege is spread fairly. Done badly, it can privilege the few, whether individuals or businesses, over the many.

Corporation tax avoidance has been a hot topic for years. There have been endless scandals and powerful campaigns to expose them and express public anger. The public has got wise to profit-shifting, where companies move money from the country in which it was made into a lower tax country to avoid paying their dues. But while our anger has grown louder, the problem still remains. In fact, multinational companies within the EU pay on average 30% less tax than a similar firm active in just one country. Imagine being the independent coffee shop struggling to survive while Starbucks next door hits the headlines for its ‘sweetheart’ deal with HMRC. It’s not fair and it needs to change.

That’s where the Fair Tax Mark comes in. Some of you may have participated in boycotts of companies exposed for shirking their tax responsibilities. But taking money away from the baddies is only half the story: if we want to tackle tax avoidance, we need to support those companies doing the right thing, whether that’s at the check-out or in our own companies’ supply chains. The Fair Tax Mark helps you do this: it’s a certified promise that the company pays its fair share of corporation tax and reports on it transparently.  And we’ve just made it easier to see which businesses near you have the Mark: we’ve just launched the Fair Tax Map. It shows all the accredited offices and shops across the UK, totalling nearly 1,500. There’s everything you could think of on there, from travel agents to supermarkets, banking services to coffee beans! By using this map to see who’s got the Mark near you, and then supporting that business, you’ll ensure you’re supporting those doing the right thing. And you won’t be alone: new polling just released by us has found that 77% of the public would rather shop in favour with a company which can prove it’s paying its fair share. We’re at the start of a movement here; the more we can shout loud in favour of businesses with the Mark, the more will join them, moving our economy towards a fairer future.

Emily Kenway, Fair Tax Mark

The views expressed in this blog are those of the author and not necessarily those of The Equality Trust.