Why is there not a wealth tax in the UK?
July 7th, 2012So President Hollande is increasing taxes on the super-rich, banks and big businesses this year by €7.2bn, about £5.7bn, and also making those with more than €1.3m pay a one-off levy this year. It is wildly popular with the French electorate, with three-quarters approving the squeeze on the rich, including a majority of right-wingers. In Britain by contrast there is no wealth tax, a mansion tax on houses worth more than £2m has been blocked, capital gains tax is at 28% far short of the 40% rate at which Thatcher left it, and the 50% income tax rate has been cut to 45%.
The case for a wealth tax in Britain has never been stronger – that wealth has reached stratospheric levels at the top, that at a time of prolonged austerity it is right and fair that all sections of the community should make a proportionate contribution, and that through massive tax avoidance the ultra-rich have been cheating for far too long. The May 2012 Sunday Times Rich List shows that there are currently 77 billionaires in Britain and 23 others worth more than £750m in the top 100, and a 1,000 richest persons all with wealth in excess of £71m. There are 2,000 with more than £34m each. Plenty of fat there to be taken in hard times.
Of course it will be said by the Tories, who get half their annual income from the banks and most of the rest from the big corporates and the super-rich, that these are the thrusting entrepreneurs on whom the future of the country rests. That’s not what the facts show. Of the 1,000 wealthiest, a quarter (238) inherited their wealth, they didn’t earn it. Nearly a fifth owe their money to property and land, certainly not from industry and exports which is what the country needs. Nearly a further fifth got their money in finance, which usually means financial engineering rather than lending to manufacturing and commerce in the national interest. And a sizeable number come from abroad, not out of any desire to contribute to the welfare of Britain, but in order to sponge off the country by enjoying the undoubted benefits of British life but paying no taxes on their world-wide earnings – the notorious non-domiciled clique.
A wealth tax, a mansions tax, a capital gains tax on the £155bn gains made by the richest thousand persons in the last 3 austerity years, and a 60% one-off levy on wealth or earnings over £1 million would be just as popular in Britain as in France. Why doesn’t Labour declare for it, particularly since it would provide the money to turnaround the economy and generate a million or more jobs as the foundation for growth which will be produced in no other way?
July 7th, 2012 at 7:11 pm
Deficit reduction can be brought about in a number of ways the fairest would be to increase the burden on rich as there are huge amounts of wealth which can be unlocked through higher taxes through increases in Inheritance, direct tax and council taxes upon the wealthy
One can here the screams of the wealthy Conservatives of unfair and unjust but the point is that the uk is a rich country where wealth is held by the few but generated by the many. it is hard to imagine anyone who is self made in economic terms. All wealth is dependant on ordinary working people in the following ways Most company’s need workers to make a profit. Share markets banks etc need company’s to speculate on (Thus Workers). Retailers and wholesalers need customers to make a profit (workers). The aforementioned would suggest a large part of the deficit could be paid of using the above measures to unlock the wealth of the few that has been produced by the many.
The UK after the Second World War faced huge debts but was still able to set up the NHS and bring about the Welfare State. This was brought about by massive taxes on top earners” maintained under the Attlee government, with the top rate of income tax reaching 98% in 1949).” Thus now may be time to slim down our fat cats
The way we shape society is about choice we can have higher taxes on the wealthy or cut services and social security to the poor It is up to us how we start to pay the deficit down. It may be argued that we would make better choices if we had full proportional representation where a plurality of voices could be heard in parliament The fundamental point that I am trying to make was that deficit reduction can be brought about in a number of different ways. Taxes can take many shapes and forms it may be safe to assume that a significantly higher rate of inheritance tax could Unlock some of the wealth found in the vast fortunes of the rich. The suggested robbin hood tax would also make a significant dent in the deficit. It Cannot be right to cut the taxes of the wealthiest whilst services and social security are cut to the poor. It may be safe to reason that if the higher taxes placed upon the wealthy are used to help pay down the deficit then you may be able to reduce the burden on ordinary people thus leaving them some spending power to give the economy some impetus. The belief in low tax economies may be misplaced. As it may be suggested that they only seems to help the already rich and prosperous. If you look at America before the economic collapse one can see a low tax economy producing great wealth with the belief that this will somehow trickle down and every one will prosper. This would seem to be a myth as it would appear that a significant part of the population then and now lack sufficient medical cover and welfare provision
July 8th, 2012 at 12:47 am
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July 8th, 2012 at 11:47 am
Why is there no wealth tax in the UK? It’s like asking turkeys to vote for Christmas.
July 8th, 2012 at 12:07 pm
France has a much more vibrant democracy than the UK. That’s the reason.