tax and be damned
It’ll come as no great surprise that the world is an unequal kinda place, principally comprised of the ‘haves’ and ‘have nots’. Similarly, no bolts-outta-the-blue that, as well as killing more than two and a half million of us, the coronavirus pandemic has, according to the World Bank, plunged some 150 million people into what that they describe as ‘extreme poverty’ and it’s the poorest in society that have been mopping fevered brows in ICU, wiping a*ses in care homes, restocking supermarket shelves, teaching kids and Deliveroo-ing tasty chicken tikka masala to our collective door. But, the real kick-in-the-teeth must be when those in life-saving essential jobs realise they are paying, proportionally, way more in tax than the wealthy professionals zooming at home in the relative comfort of their home-office.
So, when talk eventually turns to who’s going to foot the bill for the massive amounts of government spending and quantative easing, is it wrong to postulate that the wealthiest should step-up-to-the-mark and do their bit? Going even further, could this represent an opportunity for the super-rich to splash some of their cash on public services via non-negotiable higher tax payments as opposed to voluntary philanthropic vanity projects?
According to Swiss bank, UBS, there are now exactly 2,189 billionaires and just for the record that’s a thousand million dollars per person. Ironically, the pandemic appears to have done them no harm at all as their collective fortunes have grown by over 40% to a record high in excess of ten trillion dollars, which I’m reliably informed is about three times the total annual economic output (GDP) of the UK. Pre-Covid, Elon Musk was languishing in a lowly 35th richest person in the world position but is now a very marginal second to arch enemy, Jeff Bezos, with more than $180bn each. And, get this, both they and the wealthiest top 0.1% pay a lower effective tax rate than the remaining 99.9% of us.
Currently the highest tax rate in the UK is 45%, on earnings above £150,000. Now, call me peevish but it doesn’t seem a great deal and if you’re fortunate enough to be earning this amount, paying such a higher rate on earnings above that isn’t exactly going to make you poor, is it? As a society should we not go further and contemplate increases in inheritance, capital gains and even a wealth tax? Either we pay it or we leave it to our future generations, simple as. Such schemes to aid their recovery are being introduced in Argentina, Bolivia and Morocco, and, closer to home, Norwegian citizens are to pay an additional 0.85% on their assets above £125,000. They’re certainly not going to get my ‘nul points’ next Eurovision. The Wealth Tax Commission suggests a 1% tax on individuals with assets in excess of £500,000 could raise £260bn and fund the whole NHS for a year. Across the pond, Senator Elizabeth Warren, supported by the billionaire likes of Abigail Disney, Moby and Ben Cohen of Ben & Jerry’s, has proposed an annual wealth tax of 2% on those with more than $50m that would raise in excess of $4tn.
The spurious counter argument that states an increased tax regime automatically drives individuals from those particular shores I find completely disingenuous as it would not prevent anyone from being more wildly wealthy than they would ever need to be. Unless, of course, Mars exploration is their personal ambition. The same contention is wheeled out every time those in public service attempt to justify their worth by comparison with the private market but precious few ever appear to make the transition! Furthermore, the well-practiced ‘trickle-down’ argument does not stand scrutiny as the wealthy choose to save the vast majority of their income whereas those within lower income brackets have no option but to spend all their income.
Taxation is essentially an issue of social morality and why are we content with the rich getting richer? Tax evasion, and avoidance for that matter, should be seen as a criminal act and those who practice it as social pariahs. These are not the gods we should be worshipping if a fairer society is our wish. Ineos boss, Sir James Ratcliffe, our richest person and staunch Brexiter, quit Britain last year to join his pals Sir Philip & Tina Green and Lewis Hamilton in Monaco. During the last election, John Cauldwell, the billionaire founder of Phones4U, threatened to join them if Labour won and raised taxes. Bye, John, missing you already.