Kate Garraway Questions Rachel Reeves on Labour's Plan to Crack Down on Tax Avoidance

Labor has vowed to

crack

down on tax evaders to help pay for free breakfast clubs and extra appointments on the NHS. The party's spending

plan

s were questioned when Jeremy Hunt appeared to tweak two of his key revenue-raising policies in the budget, but shadow chancellor Rachel Reeves says the drastic new measures would help raise $5bn a year and she says Join us now, is it frustrating? Jeremy Hunt took those policies because it means you've had to scratch your head and think how we can raise this cash and are you sure you can do it? Well, they say that imitation is the sincerest form of flattery, so the fact that Jeremy Hunt included some of Labour's policies in his budget last month I think shows that the Conservatives have run out of ideas and have now adopted to steal from workers, but I said at the time that I would review all the government documents and make sure that Labor Party commitments to reduce NHS waiting lists, breakfast clubs in primary schools, dental appointments for emergency, that those policies would still be in place, but I would make sure. they were fully budgeted and funded and that is what people can expect from me as Shadow Chancellor and I hope that, as the former Chancellor, they will applaud if Labor is successful in the elections later this year, so now I've done that work and, uh, through a combination of

crack

ing down on tax evasion which, according to the National Audit Office, could generate an extra £6 billion a year and also strengthen the rules that the government is introducing in around the non-dominant because, although they say they have taken the measures of the Labor Party there are still a number of gaps in what they are contributing and that we can contribute more than the money necessary to continue to meet those important commitments around the NHS and schools.

In his announcement today, he refers to the tax gap. which is what, um, revenue and revenue, hmrc says it's the money they should be raising, but they're not raising it and that tax gap is now at the lowest level in 20 years, it's down to less than 5%. you are saying today that you are going to spend £500 million and employ 500 more tax inspectors and that will take you even lower, it will bring in £5 billion a year, how will that actually be done? remember, uh Ed, under the last Labor government, we started measuring that fiscal gap and it was reduced during those Labor government years, it was also reduced in the Coalition years, under a Conservative LED government, but this government, Rishi Sunak and their team, they have taken their eye off. out of line and in fact last year the tax gap increased by £5bn the National Audit Office uh the head of the National Audit Office gave a speech earlier this year which said that through By adequately resourcing HMRC we could look to bring in an additional £6bn of revenue and also in the report I published today we highlighted that the number of cases investigated by HMRC has fallen by approximately 20% over the course of this Parliament. , so the deterrent effect is simply It's not working, we are confident that we could bring in that additional money, as well as the money we can bring in through strengthening the rules around non-doms, which will mean that if there are 500 more tax inspectors, each of them at an age will We have to contribute an additional 10 million pu.

I think actually today's announcement is for more than 500 additional tax inspectors, but we have received advice from different legal and tax experts if we also look at what is happening in the United States, where its um IRS, the equivalent of our hmrc , has really strengthened its tax collection service, generating additional money, but we haven't been doing that in recent years in Britain and as a result, uh, uh, the tax gap in the last year has increased by 5 billion of pounds, that is, £5 billion that should be going to our frontline public services, but cannot do so if it is not raised.

Who would you direct this to because for many people your experience? The way you deal with hmrc is one of frustration at not being able to get over it, you find it difficult to get advice, you don't want to get fogged in, but also maybe not having access to some of the legal advice that other people have, will you offer it as a service ? it's about catching people because that's what I have, you're absolutely right, you're absolutely right Kate, tax compliance and tax evasion is what today's announcement is about right now, yeah you try to call hmrc, you're often in a queue for uh uh, you know, not just minutes but hours, yeah, uh, and the tax system is complicated and sometimes a simple phone call and that phone call will be answered, uh it can mean you get your tax return right the first time uh so hiring having more people to work at hmrc is also about making sure people get their tax returns right so it's about of tax compliance and tax

avoidance

, but specifically tax

avoidance

, you know that at this moment the cases are simply not being carried out because the staff is not there to do it and if the deterrent effect does not exist and not only is it not caught people who are trying to manipulate the system but it also doesn't deter people because there's a feeling that I'm never really going to get caught if I amend my tax returns, so it's about making sure that people have the advice needed to pay the right amount of tax, but also that we are cracking down on those who avoid paying their share and therefore shifting the burden of funding our NHS and our schools so that the vast majority of people Pay your fair share of taxes.

It's about making sure everyone pays their fair share so we can properly fund our schools and our Health Service. Well, how uncomfortable is it for you to convey this strong message as it is? this morning, when Angela Raina is still in the middle of accusations,

questions

about whether her taxes have been paid properly and correctly, I think Angela was on your show less than two weeks ago and she answered some pretty detailed

questions

about her own uh. Tax issues, but it didn't stop the question that is still being asked, it's not going away, it's a challenge, well, I mean, this is about the sale of her house, when she was married to her ex-husband almost ago. 10 years.

She was a member of parliament, she answered questions about it, she sought legal advice to make sure she paid the right amount of tax, because she is confident in that. I have a lot of faith in my friend and colleague, Angela. Raina and I are also sure that she has paid her fair share of taxes. K Sama said she had not seen her detailed tax records or her advice, but her staff had seen them and were satisfied that she had done nothing wrong. the details or that your staff have seen it no, I have not asked to see the details and I have not asked to see the tax returns or the tax advice, legal advice from any of my colleagues, this has to be on a trust basis, uh , I'm sure she's sought that advice and followed that advice, and that advice is that she doesn't have an overdue tax bill and uh, I think that's the right way it should be.

You have to be able to trust your colleagues, you know they have done the right thing and sought advice to make sure they did the right thing. Angela answered questions about this, but today's announcement makes sure that the tax code is fully compliant that tax evasion is combated and that by doing so we can turn to our schools and hospitals in a way that they need resources if we want to eliminate those lists NHS waiting period, the thing is that K Starma said his staff saw Angela Rena's detailed tax affairs and what had happened with this particular payment and I was wondering if they had been shown it and were satisfied why not make something public and then end all this speculation because you already know the tax issues of uh. other parliamentarians and government ministers are not published and I don't think it should be one rule for Angela and another rule for everyone else.

It involves the sale of her house before she became a member of parliament when she was married to her ex. Husband, this goes back years, she has followed that advice and it was right for her to do so, but I am satisfied that she has all the information and advice that is needed and she has paid the taxes due. but today's announcement ensures that those with the greatest breadth of vision to include the people who call Britain their home but do not pay their taxes here contribute appropriately to Frontline Public Services here in the UK, where they have your home, because it's right that everyone who lives here U um helps uh pay for our vital utilities and if Chan Jeremy Hunt sees your ad today decides I'll have that Snapples, does a budget or spending review in September and then advertises another cut National Insurance with the money you want to spend on the NHS what do you do then well look that's up to Jeremy what he puts in his budget if he wants to crack down on tax avoidance I'll back him 100% on that because it's It's true that people pay their fair share of taxes, but you know, if the government and the Tories are just another one of Labour's policies, I think this shows once and for all that they've run out of ideas. way, it is time for elections and time for a government that really has the ideas and is determined to put them into practice.

Well, it's a pleasure to speak to you this morning, Rachel Reeves, shadow chancellor and I'm sure we'll speak again and I'll get back to you as this develops, but thank you very much, really, thank you.