Lib Dems issue tax warning to government suppliers

26 September 2012

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26 September 2012 | Anna Reynolds

The government is taking action against the “small minority” of businesses that deliver government contracts, but continue to dodge taxes.

Speaking at the Liberal Democrat Autumn conference in Brighton yesterday, Danny Alexander, chief secretary to the Treasury, said: “There are thousands of large firms that receive taxpayers’ money to deliver a service. They do a good job helping to deliver public services.

“But I have discovered that there is nothing that prevents the very small minority of firms that don’t play by the rules from winning government contracts. That is not right. That is not fair. And I am determined that it comes to an end.”

The government minister warned: “If you want to work for us, you should play by our rules. Taxpayers’ money should not be funding tax dodgers.”

He said HM Revenue and Customs and the Cabinet Office were working to come up with a solution to the problem and more details will be released later in the year.

The announcement is part of the Liberal Democrat’s aim to crackdown on tax avoidance and evasion. Other targets include more investment in transport, tax cuts for working families and an increase on tax for banks. There is also a proposal for increased tax for the country’s 500,000 wealthiest people.

Alexander added while Britain is borrowing more money to stabilise the economy – a total of £125 billion last year – the country’s credibility has meant that people were willing to lend at some of the lowest interest rates. This money has been ploughed into funding small businesses, affordable housing projects and major infrastructure projects such as London's Crossrail.

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