Churches demand an end to tax avoidance

Church leaders have joined together to make a budget day call on Chancellor George Osborne to act on tax avoidance.

The Methodist Church in Britain, the Baptist Union of Great Britain and the United Reformed Church, along with Church Action on Poverty have called for action, ahead of the Spring Budget announcement expected today.

Billions of pounds a year are lost to the economy through tax avoidance. And with Government spending cuts expected to be announced that could cost many British households, such as the changes to the child benefit scheme, the three churches are speaking out on what they call the injustice of tax avoidance.

Simon Loveitt, the United Reformed Church's spokesperson for public issues said: "In times when vulnerable people are suffering because of cuts in public services, the immorality of tax avoidance becomes even more starkly apparent. We all simply have a moral duty to pay tax."

The Chancellor is also expected to respond to last year's Aaronson Report, a HMRC report that looked at whether a general anti-avoidance rule (GAAR) should be introduced into the UK tax system. If introduced, GAAR would mean that any transaction with the primary purpose of a company or individual paying less tax, such as charitable donations to avoid paying income tax, should be ignored when determining how much tax should be paid.

The church leaders are arguing that the introduction of a comprehensive GAAR could see around £12 billion collected that is currently lost through tax avoidance. They have also said that the Government should demand that all taxes are paid in full.

Paul Morrison, Public Issues Policy Adviser for the Methodist Church in Britain said: "The amount of tax an individual pays should be based on what they owe rather than the skill of their accountant.

"It is simply unjust that those with wealth and privilege often have the option of selfishly sidestepping their obligations, while others continue to contribute regardless of the financial pressures they face."

The move by the churches to speak out on the issue of tax avoidance is in line with their support for supporting Christian Aid's Trace the Tax campaign and Church Action on Poverty's Close the Gap campaign.