HMRC - Close The £600m Tax Loophole! - A Petition By The Good Law Project

10th May 2023

From The Good Law Project.

Due to a tax break from HMRC, private equity fund managers earning vast - seven or eight figure - salaries pay just 28% tax on their income where primary school teachers and nurses pay 40% including National Insurance Contributions (NICs). This loophole wasn't made by Parliament - but by HMRC after successful lobbying from the private equity industry in 1987.

We are campaigning to close the private equity tax loophole. And we need your help.

Sign The Petition

Whilst the private equity loophole enables fund managers to withhold £600 million per year from HMRC, private equity also harms our public services in more direct ways.

In the last two decades, private equity firms have bought out more and more of the UK's elderly care homes, children's homes, and nurseries. By 2019, 50,000 UK care homes were owned by private equity-backed operators. Private equity firm managers primarily make their profits by engaging in ‘leverage buyouts': they buy companies with borrowing, and then pay off the debt using the company's assets and cash flow. Being bought in a leveraged by-out significantly increases a company's risk of going bust.

The evidence also shows that private equity buy outs mean hugely increased prices for essential care - and often falling standards too - as the owners try to squeeze these vital public services for cash to repay the borrowing.

What's more, of the five largest private equity-owned or backed care providers, four have owners based in a tax haven, meaning they are able to withhold still more tax from HMRC.

If you agree that the richest among us should be made to pay their fair share of tax, support our campaign by signing this petition:
Sign The Petition