city skyline across body of water during night time
Photo by Craig McKay on Unsplash

This week I called on the Glasgow City Council Leadership to support “fair tax practices, the Fair Tax Mark and Glasgow becoming a Council for Fair Tax”.

Last year, Glasgow City Council spent £988 million on ‘regulated procurement’, with bidders competing for 56 contracts above £50,000 for goods and services, or £2 million for major works. In addition, the Council awarded £10m million through existing social care frameworks and almost £77 million using the National Care Home agreement.

Fair Tax Mark accredited businesses pay their fair share meeting their UK tax bills. The Councils for Fair Tax Declaration indicates a local authority’s support, standing up for responsible tax conduct by:

  • leading by example on its own tax conduct
  • calling for greater transparency in procurement
  • demanding more powers to tackle tax avoidance among suppliers when buying goods and services

Fourteen local authorities including the City of Edinburgh Council have already taken steps to support this Declaration, backing businesses that responsibly pay their fair share of taxes.

During the pandemic, the general public have been increasingly looking to spend their own hard-earned cash in businesses that pay their proper tax bill, rather than those that avoid tax and hide profits overseas.

Polling has also found that two-thirds of the public agree that government and local councils should consider a company’s ethics and how they pay their taxes, as well as value for money and quality of service, when undertaking procurement.

Research commissioned by the Fair Tax Foundation from DatLab has revealed that between 2014-19, 17.5% of UK public procurement contracts – with a combined value of £37.5 billion – were won by businesses with connections to a tax haven.

The UK Government has closed many tax avoidance loopholes in recent years, but an estimated £7 billion of corporation tax receipts are still going astray as a result of profit-shifting alone, when firms exploit gaps in tax rules to artificially shift income to low or no-tax locations.

Glasgow comes to the end of its current 4-year Corporate Procurement and Commercial Improvement Strategy in 2022.  We already look for those bidding for contracts to pay a Real Living Wage and offer community benefits through local apprenticeships and training opportunities. Development of the new strategy could enable the Council to also get behind Fair Tax in procurement and promote responsible tax conduct with businesses across the city, but we need politicians and the wider public to agree it is important.

As a member I am proud that the Co-operative Party has the Fair Tax Mark.  It is not too much to ask to get companies which are looking for public contracts to pay their way and pay the correct rate of tax, at the correct time and in the correct jurisdiction.  I look forward to progress from Glasgow City Council on this.