Close 25bn pounds of tax avoidance loopholes as economy goes into tailspin, says Unite

30 January 2011

The coalition needs to take drastic action to close the tax avoidance loopholes, as the British economy goes into a tailspin, Unite, the largest union in the country, said today (Sunday, 30 January).

Unite also called for a massive recruitment drive of tax inspectors to crack down on big business and rich individuals benefiting from tax avoidance schemes, estimated to cost the Treasury £25bn-£40bn each year. These schemes are lawful, but lose the Exchequer billions in vital revenue.

The call came following shock figures this week that saw the economy contracting by 0.5% in the last quarter of 2010 and on the day before (Monday, 31 January) tax return forms must be completed and returned.

Unite's General-Secretary-designate, Len McCluskey said: 'The coalition's 'one trick' economic strategy for recovery – cut, cut and cut again – has been shown to be financially and intellectually threadbare.'

'Their tired mantra that 'We are all in this together' is playing dangerously with the truth, when tax avoidance has reached an epidemic scale – with hard-working families in Manchester subsidising the playboy life styles of Monaco's tax avoiding British elite.'

'A legion of new tax inspectors should be recruited to collect the necessary revenue which then could be ploughed back into investment to help create jobs and generate prosperity for the many, and not just the few.'

'On the day before year-end tax returns should be filed, the government should be coming up with ways to comprehensively close the tax avoidance loopholes.'

'It is estimated that the average tax inspector generates up to 30 times the cost of his/her salary.'

'George Osborne's financial strategy is beginning to bankrupt the country, literally. Clamping down hard on tax avoidance would be one way of pulling the economy out its current tailspin.'

Along with leading economic experts, including CBI Director-General, Sir Richard Lambert and financier, George Soros, Unite is urging the government to move beyond the 'cuts alone' strategy or face economic stagnation.

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