The UK government is urged to exempt companies registered as offshore tax havens from receiving COVID-19 financial support.
The UK government is urged to exempt companies registered as offshore tax havens from receiving COVID-19 financial support. This comes after France joins Denmark and Poland in banning tax dodgers from receiving such bailouts.
As the government introduced extensive bailouts for companies affected by the pandemic, calls grew for it not to reward tax-dodgers such as Virgin Atlantic, currently seeking a £500million loan, or ‘the great parasite’ Amazon.
Think tank Institute for Public Policy Research (IPPR) director Carys Roberts told LFF that it was right for the government to move swiftly and not impose initial conditions due to the urgent nature of the epidemic.
But she said that the government should focus on ‘supporting ordinary people’ in retaining their jobs, not subsidising ‘excessive executive pay and dividends’.
She added: “So if it becomes necessary to extend any of these schemes further into the summer, or to provide other forms of corporate bailouts, the government should consider placing conditions on the companies involved.
“Their record in paying their fair share of taxes should be part of this.
“And without doubt, there can be no going back to business-as-usual – the government, having stepped in to support so many businesses, will need to look hard at companies’ behaviour on executive pay, dividends and tax once this is over.”
Plaid MP Jonathan Edwards has written to the Chancellor on Saturday asking for the government not to support tax avoiding companies.
Expressing fears that smaller companies could ‘lose out’ on government support, Mr Edwards said that this crisis the ‘importance’ of public services such as the NHS, which are taxpayer funded.
“With this in mind, I am sure you would agree with me that it would be a travesty for taxpayer money, channelled through these support schemes, to go to companies who have deliberately sought to avoid paying their fair-share of tax.
“Having effectively picked the pockets of our public services, these companies cannot be allowed to be bailed out by the taxpayer.”
University of London international political economy professor Richard Murphy has also called for companies not registering their earnings in tax havens being ‘one of several conditions attached’ to government bailouts.
And even church leaders have picked up the cause of banning tax dodgers from receiving government bailouts, in an open letter on Monday referring to legal tax avoidance as ‘morally wrong’.
Sophia Dourou is a freelance journalist
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