Tax Justice UK calls for COVID-19 windfall tax for overly prosperous firms
Campaigning and advocacy organisation Tax Justice UK is calling for the introduction of a windfall tax for the six companies who made £16 billion in excess profits during the pandemic.
According to the organisation’s new report Pandemic Profits: who’s cashing in during covid, ASOS and Serco were among the six companies across finance, outsourcing, retail, real estate, mining and pharmaceuticals who saw a rise in profits during COVID-19.
The Scottish Mortgage Investment Trust saw profits rise by 801% compared to previous years.
The report argues that these companies are examples of a broader trend where some companies benefited from government pandemic spending, while others were well placed to profit from economic changes that have been accelerated by covid.
Tax Justice UK said: “The covid pandemic has been unprecedented in its impact. Not only did it cause a recession that saw the wealthiest grow richer, whilst others struggled, it also resulted in some companies making what appear to be unprecedented profits.”
The report argues in favour of a tax system that supports a fair recovery and keeps up with the economic changes accelerated by the pandemic.
The organisation has urged that those who have suffered over the last 18 months should not be asked to pay more. However, it argued that it is fair to expect those who have prospered to contribute more to the economic recovery.
The report recommends that the Chancellor introduces a one-off windfall tax on pandemic profits made during the pandemic. It also suggests an increases to the main rate of corporation tax to 25% immediately and a closure of corporate tax breaks that don’t work. Tax Justice UK has also called for changes that equalise the taxation of capital gains and income.