We need a Fair Tax Lockdown on bailouts

The UK Government, like many across the world, is making available unprecedented financial support for businesses and workers impacted by the Covid-19 economic lockdown.

This is right and proper given the economic lockdown is being undertaken to lessen the impact of Covid-19 on society; in particular, in protection of the elderly and those with existing health conditions.

The package of support includes:

In addition, a number of business sectors are requesting bespoke bailout packages. With, for example, Virgin Atlantic reportedly calling for a £7.5 billion bailout for airlines.

To date, the UK Government has largely resisted these calls, insisting that industries should utilise the interventions already announced by the Treasury for business loans and to subsidise workers’ pay and allow tax delays. In a letter to the aviation industry, the UK Chancellor, Mr Sunak, noted: “We would expect all companies to be pursuing all possible actions to preserve cash and maximise liquidity, including engaging with shareholders, lenders and the markets and utilising all available assets and facilities”.

At the Fair Tax Mark, we leave the consideration of the merits of particular bailouts to people more qualified (and this must obviously include a primary consideration of the impact on workers).

But if bailouts are to progress, then we believe that they should be accompanied with fair tax conditions (a “Fair Tax Lockdown”)

Business should:

We believe that these measures are fair, material and proportionate. If a business is not actively involved in tax avoidance, these conditions can quickly and easily be committed to.

Paul Monaghan, Chief Executive, Fair Tax Mark