How Joe Biden’s tax avoidance plans can benefit Britain’s high streets – Rachel Reeves

AS we emerge from the Covid health crisis, the huge economic hit taken by businesses in our region and across the country is painfully clear to see.

Britain should follow President Joe Biden'slead on tax, writes Rachel Reeves.

There are more empty shops in our town and city centres. Many of those that remain open now face a critical few months of post-lockdown trading in their battle for survival.

Sign up to our daily newsletter

The i newsletter cut through the noise

Walking around my Leeds West constituency and talking to cafe owners, traders and businesses in places like Bramley and Armley, it is obvious our high streets and businesses need help.

High streets like Armley need a new taxation policy, writes Rachel Reeves.

While home deliveries were a lifeline for so many during lockdown, the consequent surge in online shopping is a massive challenge to traditional retailers.

It is not just about the vast number of jobs that these businesses support. Our high streets are also part of the fabric of our communities – places where friends and family can catch up over a coffee or a drink and support local businesses at the same time.

These businesses face an existential threat as they try to rebuild post-Covid. Many are being ruthlessly undercut by multi-national corporations that are gaming the tax system.

Put simply, many of these multi-billion pound mega-companies are selling to British customers, but exploiting lower tax rates overseas to slash their financial liabilities and undermine British businesses.

Rachel Reeves is Labour's new Shadow Chancellor.

It is a cynical tactic that gives these companies a manifestly unjust advantage over UK businesses and jeopardises thousands of British jobs at a critical time for our economy as companies struggle to get back on their feet.

This kind of tax avoidance which deprives the Treasury of billions of pounds every year might be legal, but it is certainly not fair and needs to change.

In my new role as Labour’s Shadow Chancellor, I am determined that our shops and companies can do business on a level playing field.

That’s why Labour is supporting a proposal from US President Joe Biden to make large corporations pay their fair share of tax and bring back billions of pounds to the UK.

Ahead of the summit of G7 leaders that the UK is hosting in Cornwall from Friday, President Biden is pushing for a global minimum rate of corporation tax to stop these global giants avoiding paying their fair share.

The plan gives us a once in a generation chance to overhaul global tax rules, stop global online giants undercutting British businesses, rebuild our Covid-hit economy and use the extra tax revenues to invest in strong public services.

The changes would stop multi-nationals shifting profits across borders to exploit attractive low-tax locations, depriving the UK of tax revenues earned on the back of British sales.

Biden’s proposal has widespread support across the world. Yet, Britain is the only G7 country to not back the plan. Germany, France, Canada, Italy and Japan all support the President’s proposed clampdown.

Tax Justice UK estimates a 21 per cent global minimum rate of corporation tax – the figure initially proposed by President Biden – would bring in around £14.7bn a year in extra taxes to boost public services and help create badly needed jobs.

Britain should be leading the way when it comes to tax avoidance, yet the continued failure to act of Chancellor Rishi Sunak and the Government’s threatens our economic recovery.

The Tories need to decide if they are going to cosy up to the tax dodgers or back British businesses and help protect our high streets.

By ensuring the multi-nationals pay their fair share, we can build an economy where our businesses can thrive and create decent, secure jobs.

I HAD just finished Sunday dinner with the family and was about to start the washing up when my mobile rang. It was Keir Starmer who said he would like me to become Labour’s Shadow Chancellor. I accepted, of course.

It’s a huge honour to take on an important national role at such a crucial time for our economy and to build on the brilliant work of my predecessor Anneliese Dodds.

However my top priority will remain the same – continuing to serve my constituents in Leeds West and represent them in Parliament as I have done since 2010.

Now the general election is a distant memory, we don’t hear much about “levelling up” from Boris Johnson. As is always the case with him, it was all electioneering bluster and empty promises.

However, the upcoming Batley and Spen by-election on July 1 does give people the chance to vote for someone who I know will make a real difference to people’s lives.

I’m delighted that Kim Leadbeater is Labour’s candidate to replace Tracy Brabin who stood down after becoming West Yorkshire’s Mayor.

I was heartbroken when my friend and Kim’s sister, Jo Cox, was murdered doing her job. She still leaves a huge gap in so many people’s lives.

I can think of no better person than Kim to continue Jo’s work and represent the local community she served so proudly. Kim deserves our support and will make a fantastic MP.

Support The Yorkshire Post and become a subscriber today. Your subscription will help us to continue to bring quality news to the people of Yorkshire. In return, you’ll see fewer ads on site, get free access to our app and receive exclusive members-only offers. Click here to subscribe.