The Shadow Chancellor Rachel Reeves has said she will crack down on tax dodgers that will bring in “over £5 billion” by the year end of Parliament.
Reeves has set out her plan to fill in a black hole which she claims it’s not “rocker science.”
She said there is a stark difference with what HM Revenue & Customs (HMRC) receives and what they should be owed.
Labour will abolish “loopholes” of the Tories plans to stop exemptions for “non-doms” and hope to raise £2.6 billion.
HMRC is under-resourced and Reeves will inject up to £555 million a year to build up more compliance officers at HMRC.
Reeves said that the tax gap has widened to £36 billion for 2021/22 which is £5 billion more compared to the previous year.
Reeves told BBC Breakfast she can build up the number of HMRC staff “pretty quickly” should Labour win the upcoming election.
“At the start you might need to bring in extra resource but then you need to train people up within the government to do this work.
“This isn’t rocket science – previous governments have managed to close that tax gap, as it’s called.”
She added, “The Government’s plans that they announced in March about non-doms, they said they were taking our policy; well, it turns out they’ve taken it but left a load of loopholes in it.
And so if you are a non-dom you can still get out of paying inheritance tax: in the first year of their policy there’s a 50% discount, we don’t get 50% discounts on our taxes.
“People who go out and work today – teachers, plumbers, doctors – they don’t get a 50% discount. Why should some of the wealthiest people in the country get that discount? We would abolish that and we would put that money into frontline public services, where it belongs.”
Reeves told BBC Radio 4’s Today programme, “This is the worst economic inheritance since the Second World War and it will constrain what an incoming government could do, but there’s always choices to be made.”
“And the choices that I’m announcing today are that we will strengthen the rules to ensure that non-doms pay their fair share of tax and we will crack down on tax avoidance and ensure the tax code is fully complied with to bring in over £5 billion a year by the end of the parliament.”
