Closing Loopholes
Tax loopholes allow big corporations and the wealthiest people to avoid paying their fair share. We campaign for certain loopholes to be closed, to make our tax system fairer for everyone.
What’s the problem?
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Big corporations get unnecessary tax breaks
Tax loopholes for booming UK oil and gas companies cost billions of pounds every year. Other business tax loopholes are also often unnecessary – benefiting big businesses that don’t need assistance.
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Wealthy individuals and families benefit unfairly
Wealthy individuals benefit from a multitude of tax loopholes. For example inheritance tax loopholes, generally exploited by wealthy families, cost £1.7 billion in lost tax every year. Business Asset Disposal Relief, similarly, allows wealthy individuals to halve their capital gains tax bill when selling a business. This costs £1.1 billion a year.
How can we fix it?
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First, close these 5 tax loopholes
Our research has identified just five tax loopholes, which if closed could easily raise up to £7 billion a year – enough to pay for all the nurse and teacher vacancies across the UK, with change to spare. These loopholes span business tax relief to inheritance tax. Read our research here.
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Second, monitor and police loopholes better
The government and Treasury must better monitor tax loopholes, and remove them if they’re being abused. HMRC currently has a tiny budget of £600k a year to assess whether £200 billion worth of tax loopholes are working as planned – or whether they’re being abused. The government must invest more in HMRC to boost tax compliance and enforement.