LONDON (Bywire News) - Boris Johnson’s Tories have voted down a Labour amendment in support of a worldwide ban on Tax Havens.
Labour’s New Clause 23 to the Finance Bill would have compelled the Conservative government to support the US President Joe Biden’s proposal for a global minimum Corporation Tax.
In addition, the amendment would have forced Chancellor Rishi Sunak to publish a review on the impact of a minimum global corporation tax, as well as a review on how a global minimum corporation tax could affect levels of tax avoidance and evasion.
However, the amendment was shot down in Parliament, with MPs voting 364 to 261 to reject it - with not a single Conservative MP voting in favour.
The Tories’ decision to vote down the proposal means that the UK is now the only major G7 nation not to support Mr Biden’s anti-Tax Haven plans.
Last month, the think-tank Tax Justice UK published research indicating that a global minimum corporate tax rate set at 20% would raise an extra £13.5bn a year for the UK’s public purse, rising to over £22bn a year if the rate was raised to 25%.
Following the vote, Labour leader Keir Starmer blasted the government on Twitter - accusing the Prime Minister of “risking billion pounds in tax revenue that should be spent on our recovery” as we emerge from the pandemic:
Tonight the Conservatives voted against Labour's proposals to support @JoeBiden's global minimum corporate tax on big multinationals.— Keir Starmer (@Keir_Starmer) May 24, 2021
We're the only G7 country not supporting it.
Boris Johnson is risking billions of pounds in tax revenue that should be spent on our recovery.
Before the vote, Labour’s Shadow Treasury Minister James Murray told Parliament that “people are fed up with large multinational companies avoiding their tax”, adding:
“This is a once in a generation opportunity to grasp international agreement on the global taxation of global multinationals that has evaded our country and others for so long. Yet, rather than stepping up, our government is stepping away.”
Unsurprisingly, people were quick to denounce the government’s decision to effectively support tax avoidance.
One highly viral tweet linked the fact that the Tories are funded by a third of all Britain’s billionaires to their decision to vote down the amendment:
Last night our Gov had the opportunity to generate BILLIONS in tax revenue— Marina Purkiss (@MarinaNigrelli) May 25, 2021
By supporting a global min tax on mega-rich multinationals
THE TORIES VOTED AGAINST IT
This is what happens when your Gov is funded by billionaires
And you have a PM who won’t pay for his own Deliveroo
Whilst the MP for Leicester East, Claudia Webbe, said that she voted for the amendment to “stop huge businesses like Amazon from avoiding billions of pounds of tax”:
Massive corporations, large multinationals and Tech giants are making super profits whilst paying little or no tax.— Claudia Webbe MP (@ClaudiaWebbe) May 24, 2021
Tonight I voted for a global minimum corporation tax to stop huge businesses like Amazon from avoiding billions of pounds of tax.
The Conservatives voted it down!
And another widely-shared tweet pointed out the UK’s lonely position on the issue of Tax Havens:
UK is the only G7 nation not to have backed a global minimum corporate tax rate that would reduce incentives for multinationals, including tech firms such as Google, Apple and Amazon, to shift profits into tax havens.— Henrik 🇪🇺 (@br_nning) May 25, 2021
Despite voting against the plans, government Treasury Minister Jesse Norman claimed that the Tories were actually supportive of a global minimum corporate tax rate - but that they only voted against the Labour amendment because of “tradition”.
[Writing by Jessica Miller, editing by Tom D. Rogers.]