Poland denies bailouts to tax dodgers

In the financial crisis of 2007-08, banks and businesses received billions in bailouts. Dubbed ‘too big to fail’, the financial sector accepted taxpayer-funded assistance with no strings attached. There was no pause to bonus culture, and no end to tax avoidance.

This time it has been different. Several countries have announced that companies registered in recognised tax havens will not be eligible for COVID-related support schemes.

This is entirely fair. Government support is paid for by taxes. Companies that don’t pay their taxes would be getting a free lunch.

The first country to make such a declaration was Poland. Calling tax havens “the bane of modern economies”, Prime Minister Mateusz Morawiecki announced that any business whose headquarters were registered offshore could not expect support from the government.

Denmark and then France made similar stipulations, as did Belgium and Argentina. The idea came to Britain through the Welsh government. “It is only right that businesses which are not contributing tax payments to our economy should not benefit from this scheme” said Welsh Finance Minister Rebecca Evans. Scotland followed the week after, voting in the measure when it was proposed by the Scottish Green Party.

The UK, which is a major enabler of tax evasion through its network of crown dependencies, has resisted calls at the national level, and the Tax Justice Network has a petition you can sign here.

While not applied everywhere, tying bailout funds to tax justice is a big step forward on the last crisis.

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