Exposing the taxman’s double standards

The Government tells us that we are ‘all in this together’. That means everyone paying their fair share in tax.

But through the work I do in Parliament, as chair a Committee of MPs that looks at government spending, I recently uncovered a huge unfairness in the system.

We looked at the way HMRC settles disputes with big companies that are refusing to pay their taxes. We found that HMRC has been giving these companies ‘sweetheart deals’ where they are let off huge sums of money they owe.

In one case, the banking firm Goldman Sachs had been let off up to £20 million in interest payments on taxes they had been avoiding for 5 years. It was outrageous. Just think what £20 million could buy for us in the Borough – the new schools we need, opening the maternity unit at Barking Hospital, more decent affordable homes to rent.

When we confronted the officials responsible, they seemed to simply try and lie their way out of it. They had been wined and dined by these companies and then claimed ‘taxpayer confidentiality’ to avoid answering questions about the deals they had made. It made me furious.

If you are a hard-working taxpayer, a corner shop or a small business, you are relentlessly pursued if you make the smallest error.

I’ve recently been helping Becontree Baptist Church in Dagenham, who were given a huge fine and threatened with legal action over less than £500 they owed the taxman. They had simply made an honest mistake.

Rich companies employ teams of expensive lawyers to help them avoid tax. Local organisations like Becontree Baptist Church can’t even afford an accountant to check their tax returns. I contacted HMRC on their behalf and it has now relented on the fine.

But these double standards are completely unacceptable. The Government must take a much tougher approach to making sure companies like Goldman Sachs pay their fair share. It can’t be one rule for them and another for everyone else. It’s something I feel so strongly about and one of my top priorities for the new year is to get a change in the system.

This entry was posted on Thursday, February 2nd, 2012 at 9:56 am and is filed under Blog. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.