LONDON Britain's opposition Labour party called on Thursday for big companies to publish their tax returns and for parliamentary committees to have the right to see all taxpayers' returns, to aid efforts to tackle avoidance and evasion.
Tax has become a major political issue in Britain after revelations about the amount of tax paid by large corporations such as Starbucks (SBUX.O) and by individuals led to a public outcry and widespread calls for reform.
A report commissioned by shadow finance minister John McDonnell said the UK tax authority should also row back from the policy of being more business-friendly -- a strategy pioneered by a Labour government a decade ago.
"There's a new atmosphere now abroad both in terms of business and in terms of the general public that there needs to be more openness and transparency," McDonnell said at the launch of the review of Her Majesty's Revenue and Customs (HMRC).
Labour said a string of scandals including massive leaks of documents highlighting tax avoidance involving Panama and Luxembourg raised questions about whether big companies and the wealthy pay their fair share.
The UK's Conservative government says it supports greater transparency, but not the measure proposed by Labour. Last week, parliament approved an amendment to a bill that would allow the government to publish a breakdown of companies' profits, revenues and tax payments by country.
Labour also questioned whether HMRC was too lenient on big business. HMRC has the right to publish taxpayer information if it feels it helps it conduct its role. However, most countries do not routinely publish taxpayer's returns.
McDonnell said he did not accept that companies' corporate secrets would be at risk by releasing their returns or that companies might relocate elsewhere because of Labour's plan.
Professor Prem Sikka of the University of Essex, the lead author of the study, said the model of parliament's intelligence committee which scrutinises sensitive defence-related matters, sometimes taking evidence in secret, could be the model for how lawmakers might better ensure HMRC was being effective and fair.
(Editing by Alexander Smith)