Islington Council last night approved new policy to fight tax dodging contractors.

From now on, any company doing business with the council worth over £5million will have the contract severed if they are found to have avoided paying tax.

The council executive passed the policy at a town hall meeting last night. Mike Curtis, director of resources, said: “At a time when reduced funding for public services and rising living costs are making life harder, it is right that we expect our contractors to pay their due share of taxation.

“Where necessary, we will act swiftly to sever our connections with organisations that try to evade paying tax.”