April 18, 2024

How are you going to pay for it?

It’s a question every journalist likes to ask of every politician – especially those on the left, and especially in the run-up to an election.

Well, Professor Richard Murphy has answered it, with his Taxing Wealth Report. In which he shows how thirty relatively simple changes to existing UK taxes, could raise up to £90 billion of new tax revenue per year, entirely from the top 10% of income earners. They would remain in the top 10% of income earners too.

Of course some people don’t like these ideas, even though they are simply addressing some very obvious unfairnesses. Some very high earners are threatening to leave the country. The truth is, that rarely happens. Even to British high earners prefer Blighty to the Bahamas.

Others are saying they will reduce their working hours to avoid new taxes.

Good, that leaves well-paid work available for others.

As my husband often reminds me, when Bruce Forsyth was the highest paid entertainer in the country, with a marginal tax rate of 90%, he didn’t leave the country.

He did refuse additional work. But that was a good thing. Brucie topping the bill at every theatre would have made London’s nightlife pretty boring, and his absence created openings for new entertainers at the top and so also further down the ladder.

The point of this story is that there’s always more to taxes than simply raising revenue. They’re also about changing behaviour.

For the last 40 – 50 years our tax regimes have been set up to allow a few people to get to the top and stay there forever.

Look where that’s got us.

It’s time we encouraged better behaviour.

Discipline makes Daring possible

Thanks again to Richard Murphy for the prompt.