Councillors back calls for a fair and transparent tax system for all
Published: 20 October 2021
Councillors have backed a motion calling for companies and organisation to pay their fair share of tax and to be transparent on the issue.
The motion, brought by Cllr Martin Pearce, notes public concern around issues of corporate tax avoidance and not paying the right amount of tax in the right location at the right time.
It highlights the Fair Tax Mark, which offers a means for business to demonstrate good tax conduct.
The motion, which was overwhelmingly supported by members, states that full Council believes:
- Paying tax is often presented as a burden, but it shouldn’t be
- Tax enables us to provide services from education, health and social care, to flood defence, roads, policing and defence. It also helps to counter financial inequalities and rebalance distorted economies
- As recipients of significant public funding, local authorities should take the lead in the promotion of exemplary tax conduct; be that by ensuring contractors are paying their proper share of tax, or by refusing to go along with offshore tax dodging when buying land and property
- Where substantive stakes are held in private enterprises, then influence should be wielded to ensure that such businesses are exemplars of tax transparency and tax avoidance is shunned
- More action is needed, however, current law significantly restricts councils’ ability to either penalise poor tax conduct or reward good tax conduct, when buying goods or services.
- UK cities, counties and towns can and should stand up for responsible tax conduct - doing what they can within existing frameworks and pledging to do more given the opportunity, as active supporters of international tax justice.
The motion states that Full Council resolves to:
- Approve the Councils for Fair Tax Declaration
- Lead by example and demonstrate good practice in our tax conduct, right across our activities
- Ensure contractors implement IR35 robustly and pay a fair share of employment taxes
- Not use offshore vehicles for the purchase of land and property, especially where this leads to reduced payments of stamp duty
- Undertake due diligence to ensure that not-for-profit structures are not being used inappropriately as an artificial device to reduce the payment of tax and business rates
- Demand clarity on the ultimate beneficial ownership of suppliers and their consolidated profit & loss position
- Promote Fair Tax Mark certification for any business in which we have a significant stake and where corporation tax is due
- Support Fair Tax Week events in the area, and celebrate the tax contribution made by responsible businesses who say what they pay with pride
- Support calls for urgent reform of EU and UK law to enable local authorities to better penalise poor tax conduct and reward good tax conduct through their procurement policies
Speaking in support of the motion, Cllr Pearce said: “As a Council it falls on us to set standards. As one of the key anchor institutions of this city, it is a great opportunity to say to others this is where we lead, it is time for you to follow.
“There is so much support for this not just locally but internationally. Fair tax is something that is popular with everybody. We all know it is the right thing to do.”