I am delighted Corbyn has backed the idea that he will follow his party conference on a second referendum today. Assuming that the conference is given a free vote there is no doubt that Labour party members will back the idea. That will enormously boost Labour, its membership and the belief that the members may actually be able to influence Labour Party policy, which will help many when it comes to voting.
But let's consider Labour's preferred option instead. This is a general election. Talk of it appears to be almost open now. When a minister has to deny it this morning the possibility that it is a real option was openly acknowledged.
I believe a general election is now the best way to settle the Brexit question. It would be best for the country, for democracy and for Europe and allay all the nonsense on there being no choice but see this through. So saying, I acknowledge that Brexit would be the absolute number one issue in any such election. But let me suppose for a moment that other issues might be considered. Let me just suggest some tax and related issues Labour might like to consider. The following is not a complete list. It's just a starter for 10 (or a bit more):
- Make income tax rates more progressive - including a 50% top rate theguardian.com/commentisfree/2011/sep/07/should-the-50p-tax-rate-go
- Reduce tax rates on those with lower income
- Increase corporation tax rates for larger companies taxresearch.org.uk/Blog/2014/01/30/george-osbornes-10-billion-a-year-tax-giveaway-to-big-companies/
- Create an alternative minimum corporation tax taxresearch.org.uk/Blog/2016/09/30/time-for-an-alternative-minimum-corporation-tax/
- Create a proper general anti-avoidance principle to underpin the attack on tax avoidance taxresearch.org.uk/Blog/2012/06/20/why-we-need-a-genuine-general-anti-avoidance-principle-to-beat-tax-abuse-2/
- Create a Ministry of Tax to ensure the effective management of the tax system as part of overall fiscal policy taxresearch.org.uk/Blog/2017/09/05/a-ministry-of-tax/
- Improved measurement of the UK tax gap and increase the resources available to tackle it taxresearch.org.uk/Blog/2017/10/26/i-would-love-the-uk-to-have-reliable-tax-gap-data-but-right-now-that-still-looks-like-an-aspiration-and-not-a-reality/
- Introduce public country-by-country reporting to hold large companies to account for the corporation tax they should pay concernedafricascholars.org/wp-content/uploads/2012/11/caploss07-murphy-14th.pdf
- Equalise capital gains tax and income tax rates taxresearch.org.uk/Blog/2017/07/17/wealth-taxation-a-programme-to-tackle-the-crisis-of-inequality-that-we-face/
- Abolish capital gains tax Entrepreneur's Relief which is a pure subsidy for those already wealthy taxresearch.org.uk/Blog/2015/11/17/why-we-dont-need-capital-gains-tax-entrepreneurs-relief/
- Remove the cap on income tax so that it is paid at full rate on all earned income - however much it goes up to taxresearch.org.uk/Blog/wp-content/uploads/2016/08/WealthtaxUK816.pdf
- Remove pension tax relief at higher rate with the aim of reducing wealth inequality taxresearch.org.uk/Blog/2018/03/01/in-the-last-ten-years-the-uk-has-subsidised-pension-saving-by-481-billion-wasnt-there-a-better-use-for-that-money/
- Remove higher rate charitable donation tax relief taxresearch.org.uk/Blog/2018/01/31/time-to-reform-charity-tax-relief-2/
- Introduce an investment income surcharge on unearned income as the equivalent of national insurance on such earnings taxresearch.org.uk/Blog/wp-content/uploads/2016/08/WealthtaxUK816.pdf
- Add new council tax bands to make this tax more progressive, allowing reduction in rates at lower rates and its removal from those in receipt of benefits taxresearch.org.uk/Blog/2016/12/13/there-is-only-one-acceptable-council-tax-solution-to-the-care-crisis-and-thats-to-create-more-higher-rate-bands/
- Abolish university tuition fees taxresearch.org.uk/Blog/2010/10/11/tuition-fees-the-neoliberals-just-dont-understand-why-we-must-educate-our-undergraduates/
- Write off student debt taxresearch.org.uk/Blog/2017/05/09/to-get-young-people-to-vote-offer-to-write-off-student-debt/
- Create a National Investment Bank to build the new housing this country needs at affordable prices greennewdealgroup.org/
- Bring the control of all economic policy back under the control of the Treasury since monetary policy is now effectively inoperative in the UK taxresearch.org.uk/Blog/2018/06/27/the-role-of-the-bank-of-england-the-debate-continues/
- Remove the savings rate tax as ISAs already provide all the same benefits and this allowance complicates the tax system
- Restrict ISA investment to funds creating new employment and real investment in the UK taxresearch.org.uk/Blog/2017/05/31/its-time-to-scrap-isas-and-other-tax-related-savings-schemes/
- Replace inheritance tax with a wealth tax taxresearch.org.uk/Blog/2018/03/25/its-time-to-tax-wealth/
- Pilot a Carbon Usage Tax commonspace.scot/articles/11614/10-steps-could-create-fairer-better-tax-system-independent-scotland
I'm open to suggestions, and ones on ranking of priorities as well.
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1. More progressive? My understanding is that the Conservatives made rates less progressive in the 1980s and increased the tax take. You want to reduce the tax take?
2. Agreed – Reintroduce the 10% rate
3. I’d abolish corporation tax, since corporations aren’t humans and aren’t consumers. Corporations will suffer tax on UK distributions and transfer payments of whatever nature overseas. That latter will then catch Amazon, etc
4. Create an alternative minimum corporation tax. I didn’t follow the logic, but my point 3 negates the need, I think?
5. Agreed.
6. Brilliant idea!
7, 8. See 4.
9 – 13. Agree
14. Violently disagree. You want top rates at 98% again? Merge IT and NICs with no cap at sensible rates with little progression. If for no other reason that the huge savings in admin time needed to understand and operate two systems.
15. That’s so obvious I can never understand why it wasn’t done at the outset. BUT, even better, switch to land value tax, and tax gains made on changes of planning use. Removal from those in receipt of benefits? The benefits system is too complicated as it is, don’t make it worse.
16. Agreed.
17. You can’t do that! My children have paid the fees or do they get their money back. Someone’s going to be very aggrieved if they pay off the debt only to find they should have hung on for 24 hours.
18. Never work. Wasn’t the Girobank supposed to do that?
19 – 23. Agreed.
Thank you, very interesting
If you want to destroy functioning government, society, the economy and the country your ideas are great. Second only to Brexit
“corporations aren’t humans” Really?
If they are not human, then why not tax them more because no humans will mind!
🙂
Student debt is interesting. Would your proposal reimburse those who have repaid it?
The big issue is that the university movement is so big and expensive and should the beneficiaries be subsidised by the rest of society?..there is also a massive difference in terms economic productivity and the benefit to society of for example biochemistry at Cambridge compared to social studies at Angela Ruskin?..
Angela Ruskin?
Actually I suspect for some Anglia Ruskin is precisely the right place to go
Student debt is interesting. Would your proposal reimburse those who have repaid it?
The bid issue is that the university movement is so bi
Possibly not
And not in cash
But I could see merit in issuing a long term gilt for it
That’s open to being thought about
But
Reminds me of an interview with Tony James of Generation x talking about the birth of Punk Rock in 1976/7.. “we had no instruments or money so we joined art school (because got a grant) and I blew it all on a new bass guitar and dropped out..many punk bands were formed in this way.
I received some very good advice when quite young. It eent along the lines of ‘If you have nothing useful to say don’t say it’.
You might take heed.
That comment from you was utter, incoherent nonsense
Basically we will head to a situation where the vast majority of 18yr old will go on to further education but the quality of degree will be questionable…we will find by issuing gilts, which we will do for every populist policy..you assume an open ended demand for Government borrowing?
James
You really are wasting my time
I say none of the things you suggest
It’s time for you to do some thinking before commenting or face the consequences
Richard
Well making university study free and repaying student loans and similar populist ideas will have to be financed by borrowing – so it raises the question who will buy gilts? Or we just sidestep the whole charade of pretending to borrow and instead just print money?
Do you know how they’re financed now?
Students don’t pay up front, you know
I understand how student loans work. I asked the question..How do you propose to find university education – by issuing gilts ( and who is going to buy them?) or not bother with the conduit of capital markets and print money instead?
I will do as we do now – fund it out of public money
Don’t you know that is how it is done when students pay on the ‘never, never’
Who do you think actually pay the ongoing cost already?
Many people will repay their loan in full along with an inflation busting interest charge..so for them their education will ultimately paid for by themselves and not public money
I agree
But I was asking you about how it is financed now and you have not answered
Try doing so
Or stop wasting my time
Student loans are provided by the student loan company using public monies – big difference between that money being repaid with interest as is the intention now – and just paid for by the state. Which comes back to how it will be funded.
In other words all students are funded by public money and tiny parts have been repaid
So your comments make not an iota of sense
“In other words all students are funded by public money and tiny parts have been repaid”
So your comments make not an iota of sense
so you are saying there is no material difference (for the public finances) between having a student loan system and offering free university education??.. thats interesting, please elaborate
Student loan financing comes directly out of government spending until a) the debt is sold or b) it is repaid
Given deficits are determined by cash accounting there is then no material difference between student loan financing and free university education
Loans are an accounting sham designed to shackle students into being debt laden compliant employees on a treadmill of servitude
The world operates on cash accounting.. that’s how I pay my bills that’s how I get paid.
You suggest cash is illusionary?
James
No: it is how government accounts
If you do not understand go and do some reading
I will be deleting your further comments, without exception
They are simply a waste of time
Richard
[…] be both radical, and rooted in the possible. I believe that is possible. That is why I suggested a range of tax policies […]
Abolish higher rate tax relief for charitable contributions? Come on I know your views are based on little understanding of economics and the real world but to hinder charitable donations based on tax relief seems completely absurd.
Does it matter if the reason behind the donation is a tax benefit if the charity ends up receiving the money to put to good uses?
Totally inept left wing propoganda as always from you.
Yes it does matter
Why should the best off get a relief denied to others?
George Osborne wanted to do it, I would remind you
And the assumption that all charity is good is also not true
Because if they become higher rate taxpayers they will get the same relief.
You simply want all money to go to the state via taxation so it decides where money goes. I appreciate you adore the state and a left wing utopia of everyone living in tower blocks working the land with trade unions everywhere and nobody earning more than their neighbour but fortunately the vast majority of people prefer to dictate their own destiny and be incentivised to do as well for themselves as possible.
If this then means they can claim a higher tax relief as they are a higher tax rate payer good on them!
Applying your logic a higher rate taxpayer should be able to claim the same benefits as someone out of work otherwise it is “unfair.”
You are so out of touch from the real world.
If you read this blog you’d know I often criticise the state
And I do not think that tax is the answer to all questions
Nor do I always advocate higher tax: I want higher benefits and lower taxes for those least off
So you are making up what I say
What I do believe in is a fair tax system
Might you tell me why you oppose it? With what good reason do you do so?
I have no issues with any of this as it applies to domestic policy.
I wish Labour actually had stuff like this because if they got in I’d like to see them attack these issues with the same gusto the vicious nasty Tories started to dismantle things in 2010. They did not mess about and got straight into it (wasting millions of pounds in the process I can tell you).
The first thing I’d like Labour to do is re-establish brown field remediation grants which would help to kick start affordable homes building. It would be even nicer if they made sure that the polluting firms were made to contribute to the clean up.
On the tax front Robin Hood tax anyone? I’d like to see that too. And I’d like to see the low paid put back into tax – not excluded from it. I think that there is something fundamentally wrong when people are excluded from tax. They potentially become a political football and they are disenfranchised from society too.
I’d like to see VAT looked at. It is far too high and its imposition on say insurance costs is not in my opinion very helpful or apt.
12. .. and apply Class 1 NIC on employer pension scheme contributions.
Also:
– Cap PPR relief (e.g. £100k + £10k for each year of ownership)
– Scrap the CGT-free uplift on death (i.e. treat death as a disposal by the deceased and impose CGT accordingly)
Happy with both
Agree with all that PSR.
I’d like to see VAT reduced at the same time as a ‘Robin Hood Tax’ is imposed because when the bankers and financiers squeal they would be squealing about no longer being tax exempt against the possibility of the rest of us enjoying reduced VAT.
Also think that new council tax bands should be seen as part of the progress towards Land Value Tax as should an update of business rates, which for retailing in particular, is beginning to change towns into charity shop centres, which pay no business rates.
Local government finance in general also needs significant change, though that’s a difficult nut to crack.
Peter
I think that the way we do LA management and finance has to change markedly in the UK. The structures are all wrong. These need to change so that financial matters can be resolved.
I would like to see a similar system set up here as there is in Germany where regional government seems to be more able to have a more robust relationship with the central government rather than the nodding dog role that many LAs in this country seem to have.
But nothing will change until the centre realises or can agree on what the role of Government is. Is it to enable profit making and its corporate citizens? Or is it to look after its citizens? Or is it both?
I would advocate “23 – Pilot a Carbon Usage Tax” – as number 1.
Climate disaster stares us in the face. Emissions by developed countries must be reduced hugely and soon. The UK government ignores aviation and shipping, but when they are included, as they should be, emissions are still rising in the UK, in other developed countries and worldwide.
What’s more linear taxes do not sufficently inhibit the wealthy (= those who squander the most carbon – predominently). Equally, carbon frugality is not adequately rewarded. Tradable Energy Quotas (TEQs) are needed.
Also, a lot of energy is required to build new houses and the UK has plenty of housing: there are a million or more empty or “second” homes and 250,000 owners of properties with eight or more rooms per person.
Rationing (so many square metres per person) could simultaneously help with the crises in housing and climate. The “tradable” element would contribute towards redistribution of wealth.
A tax on only second homes (Labour’s holiday home tax) would be insufficent both for the need to providing an adequate number of homes quickly and for minimising carbon emissions from new build.
“I acknowledge that Brexit would be the absolute number one issue in any such election.”
That was the assumption about last year’s one too, and the analysis afterwards showed it didn’t make the top 10 issues.