Taxation: Avoidance

Baroness Farrington of Ribbleton Excerpts

Tuesday 11th December 2012 Lords Chamber

[Lord Newby]

We are reducing the rate of corporation tax but there is a danger of a race to the bottom. Corporation tax brings in a substantial amount of money and is an important contributor to the Exchequer.

[Baroness Farrington of Ribbleton]

My Lords, would the Minister join me in welcoming the fact that Her Majesty’s Government, having cut the money to HMRC for dealing with this problem, have now restored their own cut? Would he see whether it is possible to collate information about those companies with large numbers of employees that do not even pay a living wage to those employees, let alone their tax, and therefore cost the Treasury in additional income support?

[Lord Newby]

My Lords, I am afraid the noble Baroness is wrong about what has been happening with the resources: we have been reallocating resources within HMRC. Bearing in mind that so many taxpayers now pay their tax online, we do not need as many people opening envelopes. However, we do need highly sophisticated people working as analysts and investigators.