Beth Winter, a Labour MP, asked this question in Parliament this afternoon:
Richard Murphy, a professor of political economy at City University in London, says that the Government have the potential to raise £174 billion a year if wealth was taxed at the same rate as income. That could cover the cost of the job retention scheme for over 12 months, according to the latest estimates from the Office for Budget Responsibility. Does the Chancellor believe that the time is right for a radical overhaul of our taxation system in order to fulfil the Prime Minister's levelling-up promise, or is the truth that we are not really “all in this together”?
No, I do not believe that now is the time, or ever would be the time, for a wealth tax. Now is the time to recognise the acute challenge that we face of unemployment and now is the time to act decisively and with compassion to provide hope and opportunity to the hundreds of thousands of young people, especially, who are at risk of scarring and losing the future that they deserve. That is why we have put in place the measures today, and that is what the focus should be on.
I am sure Rishi Sunak has his own very good reasons for opposing a wealth tax. What is clear is that, along with the prime minister, his mind is made up on this issue. What is also apparent is that it is being used to beat Labour with wholly false claims.
So what to do? As I have argued in the Tax After Cornonavirus series, the answer is to concentrate on the need for additional taxes on the income from wealth rather than a wealth tax itself. And the yield would, anyway, be higher, whilst the wins would be easier to secure.
This issue is not dead as yet, by a very long way. A Chancellor saying no is not enough to end a debate.
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gosh who would have wondered why he was shooting it down ?
Sunak started his career with investment bank Goldman Sachs before moving to the hedge fund sector, eventually setting up his up his own firm Theleme Partners in 2010 with an initial fund of $700million.
Sunak’s salary as chancellor is £71,090 which excludes his salary as MP (£79,468).
Sunak and his wife own a property portfolio spanning the UK and America that is worth about £10m. Their London home is a five-bedroom mews house in Kensington worth £7m. They also own a £1.5m Georgian mansion set in 12 acres in Sunak’s North Yorkshire constituency, among other properties.
these points are lifted from here:
https://londonlovesbusiness.com/how-rich-is-uk-chancellor-rishi-sunak/
And his father in law is a billionaire, apprently
His father-in-law is N. R. Narayana Murthy, who founded Infosys. Net worth £2.5 billion (https://en.wikipedia.org/wiki/N._R._Narayana_Murthy).
The UK is currently a plutocratic kakistocracy. “The Conservatives are not the party of aspiration, they’re the party of privilege, funded by those who want to protect their privilege … Until we kick big money out of politics, our political system will be rigged in favour of the obscenely wealthy.” (Rebecca Long-Bailey: https://www.mirror.co.uk/news/politics/tory-millionaires-whose-cash-toppled-21576198).
Surely it would be economic suicide to introduce wealth taxes now. “Wealth taxes at the same rate as income” what does that mean?
Why not read what I have said on this issue – it’s all linked?
Extra taxes on wealth now would be just what we need but only so long as even more was spent on those on low incomes
In the usual way of politicians, Sunak is answering a different question to the one asked (which should perhaps have mentioned “increases in wealth” rather than “wealth”).
He was not asked about a wealth tax. He was asked about taxing the increases in wealth (that is, investment income and capital gains) at the same rates as income from other sources (that is, earned income), which is what the £174 billion per year figure is about (a very broad brush estimate of the additional annual taxes if increases in wealth were taxed at the same rates as income.). http://www.taxresearch.org.uk/Documents/WealthTaxData420.pdf
I’m not sure if you’ve seen this from earlier in the week but I haven’t seen it mentioned anywhere on your blog so just in case you missed it Paul Waugh wrote a good piece on where Starmer is in regards to a wealth tax. The article includes a brief mention of “early backer of Corbynomics” Richard Murphy.
https://www.huffingtonpost.co.uk/entry/keir-starmer-anneliese-dodds-covid-budget_uk_5f038d13c5b6acab28546368
I was its creator, inadvertently
What’s weird is it was always written for Caroline Lucas….but there you go…..
Agreed – a very simple proposition – make tax fairer – this can be comprehended by all.
It is then not about taxing wealth that people have worked so hard for (just like the Donald…) but a purely administrative measure to even up tax rates for all.
I am all for a direction of travel that takes us to a better place.
Prentii says:
” — a very simple proposition — make tax fairer — this can be comprehended by all.”
Unfortunately the mechanisms and process of making tax fairer are not easily comprehended. On the face of it many people would think that a flat rate of income tax for all income levels sounds fair. The same people would not for a moment think it fair that everybody be paid the same for their labours.
Making taxation ‘fair’ is immensely complicated and inherently political……..
If everybody read Richard’s book ‘The joy of Tax’ there would still be large swathes of the population that couldn’t discern what was fair.
@Andy Crow
I was agreeing with Richard, that taxing income from wealth is a good idea that most people will see as ‘fair’
I know only too well that ‘fairness’ in taxation is tricky.