12 words from a Labour MP just blew the Paradise Papers wide open

Margaret Hodge Paradise Papers
Support us and go ad-free

In the House of Commons, 12 words from Labour MP Margaret Hodge just blew the Paradise Papers scandal wide open.

The papers

The Paradise Papers detail the offshore tax affairs of more than 120 politicians and leaders and over 100 corporations. The investigation came about after a leak of millions of documents from offshore law firm Appleby.

The 12 words

After securing an emergency debate on systemic global tax dodging, Hodge told parliament:

Every £1 invested in HMRC enforcement yields £97 in additional tax revenues.

This means that the government receives up to a 9,600% return on investment in enforcing tax rules on large businesses. But as Hodge then noted, the government is actually cutting HMRC staff in the name of austerity:

It’s a complete no-brainer that we should be strengthening HMRC and reversing some of the 40% cuts they have suffered under the austerity programme

Since 2005, the number of HMRC staff has almost halved from approximately 105,000 to 58,000. And it looks like the government has no intention of changing course. HMRC also plans to close 90% of its UK offices and cut workers in its personal tax service by 30%.

Read on...

Support us and go ad-free

Yet according to analysis of HMRC’s own data, the government yields up to a 9,600% return on investing in tax enforcement. That makes sense, given the sheer amount of money we lose through tax avoidance and evasion. Tax dodging loses the UK up to £120bn per year, which is more than the entire NHS England budget. Rather than saving money, austerity cuts to HMRC are costing the Treasury a fortune.

Responding to the Paradise Papers, Theresa May said:

We want people to pay the tax that is due.

But Hodge’s 12 words suggest that the Conservative government is actually encouraging tax dodging. Counterproductive cuts to the tax assessment and enforcement department are making it dead easy for the rich to get off scot-free. So it looks like the Paradise Papers are exposing the Conservative government as much as those named in the leak.

Get Involved!

Join The Canary, so we can keep holding the powerful to account.

Featured image via BBC Parliament

Support us and go ad-free

We need your help to keep speaking the truth

Every story that you have come to us with; each injustice you have asked us to investigate; every campaign we have fought; each of your unheard voices we amplified; we do this for you. We are making a difference on your behalf.

Our fight is your fight. You’ve supported our collective struggle every time you gave us a like; and every time you shared our work across social media. Now we need you to support us with a monthly donation.

We have published nearly 2,000 articles and over 50 films in 2021. And we want to do this and more in 2022 but we don’t have enough money to go on at this pace. So, if you value our work and want us to continue then please join us and be part of The Canary family.

In return, you get:

* Advert free reading experience
* Quarterly group video call with the Editor-in-Chief
* Behind the scenes monthly e-newsletter
* 20% discount in our shop

Almost all of our spending goes to the people who make The Canary’s content. So your contribution directly supports our writers and enables us to continue to do what we do: speaking truth, powered by you. We have weathered many attempts to shut us down and silence our vital opposition to an increasingly fascist government and right-wing mainstream media.

With your help we can continue:

* Holding political and state power to account
* Advocating for the people the system marginalises
* Being a media outlet that upholds the highest standards
* Campaigning on the issues others won’t
* Putting your lives central to everything we do

We are a drop of truth in an ocean of deceit. But we can’t do this without your support. So please, can you help us continue the fight?

The Canary Support us

Comments are closed