Why did we sign the Fair Tax Declaration? The short answer is that we signed it because it’s fundamentally the right thing to do!

There’s a longer and more interesting answer which involves the journey that we have been on as co-operators and that it aligns with our values and priorities as a council. Importantly, we have embedded the Declaration in what we do as a Council. We lead by example and demonstrating good practice in our tax conduct, right across our activities. We make sure that our contractors implement IR35 (off payroll working) robustly and pay any due employment taxes. We shun the use of offshore vehicles for the purchase of land and property by the Council. We undertake due diligence to ensure that not-for-profit structures are not being used inappropriately as an artificial device to reduce the payment of tax and business rates. And we require clarity on the ultimate beneficial ownership of suppliers and their consolidated profit & loss position.

My sense is that the Declaration complements our co-operative vision and with our approach to procurement and Community Wealth Building Strategy and our desire to keep more of the money spent in Sunderland in Sunderland.

Sunderland City Council’s Procurement Policy, which applies to all external third party spend, makes sure that we commit to use our best endeavours to ensure that all procurement activity is designed to secure the best outcomes within the finance available, is economically and commercially effective, accountable and auditable, is ethically, environmentally, socially responsible and support the local economy and (of course) legal.

No ifs, no buts, fraudulent evasion and offences in connection with taxation is a mandatory ground for exclusion embedded within Tender Documentation for procurement opportunities with us.

Contractors must notify the Council in writing of any occasions of tax non-compliance or any litigation that it is involved in throughout the term of a contract, and terms and conditions include termination grounds in the event of tax non-compliance with a contractor.

We apply IR35 robustly. IR35 should mean that workers, who would have been an employee if they were providing their services to the client, pay broadly the same Income Tax and National Insurance contributions as employees. We conducted an audit exercise to establish which contractors would be inside or outside IR35 to raise awareness of compliance requirements. This resulted in the cessation of contracts with some individuals to ensure contractors were transparent in meeting their tax obligations.

We’re promoting Fair Tax Mark certification to local businesses, our contractors and in any business in which we have a significant stake and where corporation tax is due. Promotion of Fair Tax Mark is included in the Council’s Supplier Charter issued to all bidders to raise awareness. Further, we plan to write to the top 130 Suppliers (reflecting 80% of Council third party spend) to encourage them to adopt the Fair Tax mark accreditation.

Tax shouldn’t be taxing, as the advert for self-assessment goes. It shouldn’t even be that difficult to get right – despite the example set by some I could mention in the Conservative Party. For us, the bottom line is simple. If you want to do business with Sunderland City Council, you need pay the right and fair amount of tax.