“I do believe that as leaders, we all have a common interest in being able to tell our taxpayers who work hard and pay their fair share of taxes, that we will make sure others do the same…But to achieve this will require strong political leadership…I hope we can be ambitious.”
(David Cameron, Prime Minister’s Letter to G8 Leaders, 2 January 2013)
This year the UK holds the Presidency of the G8, with the world’s top leaders coming to Lough Erne in Northern Ireland in June. This is a momentous and perfectly timed opportunity to turn public anger, evident around the globe, into concrete action to tackle tax dodging at home and abroad. As Lib Dem Treasury spokesperson I have led the campaign for Fairer Tax, leading the campaign against named and shamed tax dodgers (despite its philanthropic investment, Starbucks cannot claim to invest in our communities until it pays its fair share) and arguing for greater action to protect developing countries from multinational tax dodging. It is vital that, as we become the first British government to fulfil the 0.7% commitment in aid spending, UK taxes do not fill a hole left by multinational tax dodging in aid recipients’ national budgets.
The recent report by Action Aid on Associated British Food’s tax affairs in Zambia is the straw that came after the camel’s back broke; tax is in vogue but not in the way we’d like it to be (I would prefer to talk about the £660 tax cut which the Lib Dems have delivered for 20m of the poorest tax payers and the 2.2m of the very poorest we’ve taken out of the tax system completely…). Now is the time for action, not words. That is why I have written to the Prime Minister and Chancellor to ensure they know that the Liberal Democrats will support tough and effective action on multinational tax dodging as part of our G8 Presidency.
On Wednesday at PMQs, I asked David Cameron again to make tax justice a priority at the G8. I was mildly surprised to get a positive response:
I also agree with the issue he raises with respect to tax transparency, and that is why the Government are putting it at the head of our G8 agenda for the meeting that will take place in June at Lough Erne in Northern Ireland. One of the great things about this agenda is that it brings together developed and developing countries with a shared agenda that is good for both.
I have submitted a motion to our Party’s Spring Conference to toughen our own policy on corporate tax affairs and hope it will be passed by members so that we can build up our campaign for concrete action in Lough Erne in June. We need international action to tackle a multinational problem; these corporations cannot continue to take resources out of communities, in the UK and elsewhere. The G8 has the public’s support to take tough action and I will be doing all I can to make sure it is ambitious.
* Stephen Williams is the MP for Bristol West and is Minister for Communities and Local Government.