‘Tax a lot’, Sykes welcomes G7 plan to tax multinational traders

Oldham Liberal Democrats have welcomed the adoption by the leaders of the world’s wealthiest nations of a proposal to levy a uniform 15% tax on the profits of multinationals, especially as it is similar to their own idea brought to the March 2021 Council meeting.

Chancellor Rishi Sunak, who is hosting the meeting of G7 leaders in London and Cornwall, announced an agreement in principal of a plan to introduce a 15% global minimum corporate tax rate on multinational corporations. Many of these domicile their head offices and declare corporate profits in no-tax havens or low-tax nations as a means of tax avoidance.

Commenting, the Leader of the Liberal Democrat Group, councillor Howard Sykes MBE said: “It would be nice to think Rishi Sunak did have the chance to read our March motion as this proposal mirrors our own idea to impose a tax on the excess online profits of multinationals, albeit on a national, rather than international, scale. Although 15% is too low a figure to impose on companies like Amazon, Facebook and Google, who report consistently obscene profits, it is a start as this is the first international agreement of its kind.  So to Chancellor Sunak I say, ‘Tax a lot’.” 

“There now needs to be more pressure from enlightened governments, politicians and faith leaders; charities and civil society groups; and concerned citizens to continue to press the G7 to make this tax real, substantial, and unavoidable”, added councillor Sykes. “And the money raised must be directed to where it is needed – alleviating the suffering of the world’s poor, tackling climate change, and supporting the recovery of our Covid-hit economies.”

The motion taken to the March 2021 meeting of Oldham Council by the Liberal Democrats (and approved) read:

Council 24 March 2021 – Notice of Opposition Business

Motion 1 – A Tax on Excess Online Profits

Council notes that whilst smaller High Street non-food retail outlets have been forcibly closed, and are facing business failure, because of the COVID-19 Lockdown, larger national businesses and multi-national businesses offering on-line products have thrived, reporting bumper profits.

Council notes that recent proposals from the UN and the EU are working to establish an international consensus on business taxation, to minimise profit-shifting for the purpose of avoiding corporation tax, but that these proposals are not likely to be introduced in time to have any impact on the excess online profits that some companies have made off the back of the coronavirus epidemic.

Raising a bespoke tax on excess online profits has precedent in the UK, and Council expresses its disappointment that the Chancellor has not yet introduced such a tax and believes that if we are, as the Prime Minister claims, ‘all in this together’, then the excessive profits of such on-line businesses should be subjected to a greater level of tax, and that the revenue raised employed to support our hollowed out public services (local government, schools and health) and the financial recovery of our High Street retailers.

Council resolves to ask the Chief Executive to write to:

  • The Chancellor of the Exchequer, The Rt Hon Rishi Sunak MP, urging him to introduce such a tax as soon as possible as one means to ensure that we are ‘all in this together’.
  • Our three local MPs, the Greater Manchester Mayor and the Leaders of the other nine AGMA authorities to seek their support for such a tax.

Proposed by:                                      Seconded by:

Councillor Howard Sykes MBE                Councillor Diane Williamson

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