In Brief: Former DFID secretary calls for Big Tech tax to fund aid

Andrew Mitchell, former U.K. secretary of state for international development. Photo by: Russell Watkins / DFID / CC BY

A former international development secretary has called for a tax on large technology companies to help pay for the United Kingdom’s international aid budget, which is being cut from 0.7% to 0.5% of gross national income.

Andrew Mitchell, a senior backbench Conservative member of Parliament and vehement defender of development, has been critical of the government’s decision to reduce the budget by around £4.5 billion this year, which is expected to significantly impact bilateral aid spending.

“Why not let Amazon pay fair tax and not balance the books in this way on the backs of the poorest people in the world?” asked the former head of the Department for International Development, urging the government to take a second look at what he called a “pernicious and shabby cut.”

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Insiders expect bilateral health assistance to be hit significantly by the country's planned budget reductions.

Mitchell is understood to be backing a parliamentary rebellion against forthcoming government legislation to change the aid spending target. An exact date for that discussion is still unknown, but Mitchell recently told Devex that “leaders of the rebellion are quietly confident that the government will have to change its mind.”

Online retailer and delivery service Amazon thrived in the U.K. in 2020, as people were unable to travel to the shops because of coronavirus restrictions. But despite making £19.3 billion last year, the company paid just £71.5 million in tax, proportionally far less than most retailers.

Chancellor Rishi Sunak, who announced the aid cut, is reportedly considering new business taxes to help pay for the government’s deficit. But the government has stuck by the reduced aid budget, while saying the reductions will only be temporary.

About the author

  • William Worley

    William Worley is the U.K. Correspondent for Devex, covering DFID and British aid. Previously, he reported on international affairs, policy, and development. He also worked as a reporter for the U.K. national press, including the Times, Guardian, Independent, and i Paper. His reportage has included work on the Rohingya refugee crisis in Bangladesh, drought in Madagascar, the "migrant caravan" in Mexico, and Colombia’s peace process. He can be reached at william.worley@devex.com.