Saturday 22 May 2021 / 10:30 PM Lisa Nandy / Rachel Reeves

Labour calls for government to back global minimum rate of corporation tax

Labour calls for government to back global minimum rate of corporation tax

The Government must back the global minimum rate of corporation tax being proposed by President Biden at the upcoming G7 summit, or risk undermining a global deal to tackle major tax avoidance, Labour have said today.

 

Britain is now the only country to not back the plan, with Germany, France, Canada, Italy and Japan backing Biden’s proposal. 


The Shadow Chancellor of the Exchequer Rachel Reeves MP, and Shadow Foreign Secretary Lisa Nandy MP, have written jointly to their counterparts, marking the pact as a once in a generation opportunity to stop huge multinationals avoiding British tax and undercutting British businesses, as well as arresting the global race to the bottom on corporate taxation.

 

And they have pointed to how tech giants and large multinationals have avoided paying billions of pounds in tax every year that could be invested in British public services and industry.

Tax Justice UK estimate the 21 per cent global minimum rate would bring in about £13.5 billion a year in extra tax benefitting Britain.

Shadow Chancellor of the Exchequer, Rachel Reeves MP, said:

 

“The Government have promised to get tough on tax avoidance, but they have failed every time.

 

“This global pact will bring in billions of pounds in extra tax benefitting Britain, while stopping huge multinationals and online giants from undercutting our businesses.

 

“By making sure they pay their fair share in Britain, we can level the playing field for our brilliant businesses, and build an economic recovery with thriving industries, and good, secure jobs for all.”

Shadow Foreign Secretary, Lisa Nandy MP, said:

“When President Biden steps off the plane for his first visit to the UK, he will be meeting a British government that is blocking his historic proposals to level the global playing field and make taxation fairer for all.

“This is money that should be used to support communities across Britain. Instead the Government is allowing it to leak out of towns and villages into the pockets of big global corporations.

“Hosting the G7 is a crucial test for this government. We must use this summit to lay the foundations for a global recovery and build a stronger and fairer economy.

“The Government should be showing real leadership, not standing in the way of this landmark plan.”