Public sector 'must fill tax gap' as debt soars

Date: 23rd February 2009

The public sector must take greater responsibility to fill the taxation gap, it has been argued, as national debt soars.

Data from the Office for National Statistics has revealed that the government now owes more than £700 billion, with this set to rise further due to recent banking bail-outs.

The Trades Union Congress (TUC) believes that Westminster must now reinvest more into lowering taxation and tackling havens, if the economic picture is going to be improved anytime soon.

General secretary of the TUC, Brendan Barber, said: "A steep fall in the tax take in the middle of a recession will surprise no-one.

"It is absolutely right to let the deficit grow. When companies and consumers stop spending, the public sector must fill the gap."

But, he added, the rising deficit made eliminating taxation avoidance and evasion "even more urgent".

Last week, the Confederation of British Industry claimed that the government needed a "louder voice" when proposing new measures to stimulate the economy.