Labour crack down on tax dodgers will mean ‘more money for Scotland’, Ian Murray says

The party aims to raise £5 billion a year by the end of the next parliament by narrowing the “tax gap” – the difference between the amount of money HM Revenue & Customs (HMRC) is owed and the amount it actually receives.

Labour has said it hopes to also raise £2.6bn over the next Parliament by closing “loopholes” in the UK Government’s plans to abolish exemptions for “non-doms”, people who are not “domiciled” in the UK for tax purposes. This will then be used to fund its commitments on schools and the NHS, as well as investment in Scotland.

Mr Murray, the shadow Scotland secretary, claimed this would help deliver better public services for the taxpayer.

He told The Scotsman: “The SNP and Tories have brought our NHS to its knees. A Labour government will clamp down on tax avoidance from the richest and use that money to fund the NHS to get waiting lists down.

“By clawing back money that is owed to the taxpayer, it will mean more money for Scotland and Scotland’s NHS.

“While the SNP and the Tories have raised the tax burden on working people to the highest in living memory, Labour will clamp down on tax avoidance by the richest and ensure our public services have the money they need.”

It came as Labour’s Rachel Reeves described the plan to fill a hole in her spending plans with a raid on tax dodgers as not “rocket science”. The shadow chancellor was forced to respond after Jeremy Hunt used his Budget to adopt some of Labour’s revenue-raising policies to fund his pre-election cut in national insurance.

She has now decided that Labour will work on closing the tax gap, which had widened to £36bn in 2021/22 – £5bn more than it had been the previous year – as an under-resourced HMRC struggled to collect revenues and manage compliance.

It will also consider requiring more tax schemes to be registered with HMRC to make sure they are legitimate, and plans a focus on offshore tax compliance.

Ms Reeves told BBC Breakfast she could “ramp up” the number of HMRC staff “pretty quickly” if Labour won the election.

She said: “At the start you might need to bring in extra resource, but then you need to train people up within the Government to do this work.

“The Government’s plans that they announced in March about non-doms, they said they were taking our policy; well, it turns out they’ve taken it, but left a load of loopholes in it.”

Treasury minister Nigel Huddleston responded by criticising deputy leader Angela Rayner over her own financial affairs.

She has faced repeated questions from the Tories over whether she should have paid capital gains tax on the 2015 sale of her home due to confusion over whether it was her principal residence.

He said: “Labour hasn’t changed. When it comes to tax, it’s one rule for the British people, another rule for the Labour leadership.

“The shadow chancellor is committed to the same old Labour policies – back to square one with higher spending, higher borrowing and higher taxes.”