The rich in the UK currently pay a lower proportion of their income in tax than the poor
The lowest-earning 10% of people in the UK pay 39% of their incomes in tax, while the top 10% pay just 35%. Although high earners pay higher rates of income tax, taxes like VAT and fuel tax account for a higher proportion of expenditure for lower earners.
Corporations avoid their social obligations through widespread tax avoidance
Wealthy individuals and corporations can avoid paying much of their tax altogether. Some of this takes place as illegal tax evasion, but huge amounts are lost through legal tax avoidance. This is big business, and as we’re constantly reassured, is ‘entirely legal.’ But it’s hardly moral.
£45-£100 billion is lost each year through tax avoidance and evasion. Every pound avoided in tax is a pound less to spend on childcare, social care, health or education. At a time when spending cuts are having a real and damaging impact on the lives of some of the poorest and most vulnerable people in the country, it is morally indefensible for some of Britain’s richest companies to be avoiding paying their fair share of UK taxes.
We can Close the Tax Gap...
- We can change attitudes, and press for a tax system in which businesses and wealthy individuals pay their fair share.
- We must tackle tax avoidance - for example, by regulating or closing tax havens.
- This would reduce the need for damaging cuts in public spending.
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