Cllr Mary Atkins is Vice-Chair of Lambeth’s Overview and Scrutiny Committee and a councillor in Tulse Hill ward.
Lambeth Labour councillors voted to commit Lambeth Council to the Fair Tax Declaration at a meeting of Full Council on Wednesday 22nd September.
The Declaration, which has been produced by The Fair Tax Foundation, commits local authorities like Lambeth to pursuing exemplary tax conduct in our affairs, and requires greater transparency from the companies who we contract to supply services to Lambeth residents, and joins calls for more meaningful powers from central government to tackle tax avoidance amongst supplies when buying goods and services.
Why are we supporting the fair tax movement?
In 2019, Labour councillors introduced a Responsible Procurement Policy that we use to make sure Lambeth Council is spending money on contracted services which are value for money, deliver the best for residents, and live up to the values we fair work and fair pay. The policy ensures that the council can guarantee companies we contract pay the London Living Wage as a minimum, support apprenticeships, training for local people, and contributes to our efforts to make Lambeth carbon neutral by 2030.
We recognise another important element of ensuring the best in our procurement is through fair tax. Research commissioned by the Fair Tax Foundation from DatLab has revealed that between 2014-19, 17.5% of UK public procurement contracts – with a combined value of £37.5bn – were won by businesses with connections to a tax haven. Many tax avoidance loopholes have been closed in recent years, but an estimated £7bn of corporation tax receipts are still going missing as a result of profit-shifting.
Fair Tax – is it possible?
The Fair Tax movement is referring to taxes on company profits. Tax avoidance leads to a poorer less invested society and corporate tax avoidance is an international issue that is gaining popularity as governments work together to ensure companies such as Amazon pay tax in the countries where they do most of their business, Europe, and the USA rather than tax havens.
This is why in Lambeth Labour we are doing all we can to make sure our values of fairness and good public services are delivered using all the power we have. By ensuring that Lambeth Council’s tax affairs are transparent, and the Council budget is used to contract with suppliers who pay their fair share of tax in a transparent way, is one way of securing investment in society locally, nationally, and internationally.
The recent tax rise on individuals to pay for proposed changes to social care was a Conservative government decision to make individuals pay by increasing national insurance contributions. The government could pay for the investment in other ways such as a tax on companies that had made excess profits out of government contracts during Covid, but they chose not to, in Lambeth we choose differently.
The Council signing and implementing the Fair Tax Declaration will support tax transparency and help build the consensus in this country that the Tax system should change.
Cllr Mary Atkins