Comments on: Fairer income tax means thinking about more than the top rate https://neweconomics.opendemocracy.net/fairer-income-tax-means-thinking-about-more-than-the-top-rate/?utm_source=rss&utm_medium=rss&utm_campaign=fairer-income-tax-means-thinking-about-more-than-the-top-rate Tue, 11 Sep 2018 13:31:09 +0000 hourly 1 https://wordpress.org/?v=5.3.4 By: MalcolmRamsay https://neweconomics.opendemocracy.net/fairer-income-tax-means-thinking-about-more-than-the-top-rate/#comment-103 Thu, 23 Feb 2017 12:57:00 +0000 https://www.opendemocracy.net/neweconomics/?p=763#comment-103 “There are other important issues that should be in the frame: for example, stemming the increase of in-work poverty, reacting to the rise of insecure work, and shifting taxation from labour to asset wealth, where inequality is significantly greater. Addressing these requires us to think across the income spectrum.”

I’d say there’s a risk here of putting a lot of effort into reforms which a) would struggle to get sufficient support even if the left were in the ascendant, b) would be easily rolled back a few years down the line and c) would be hopelessly inadequate even if they were brought in.

Those issues you list are only partially matters of income and I can’t see that they’ll ever be solved by tackling them through income-related measures. Underlying them all are derelict laws of ownership which deny the majority of the population a fair share in our countries’ natural resources, laws which are indefensible but which the establishment can safely ignore as long as reformers focus on simply trying to stretch the boundaries of the current system. We won’t build a fair society by piling up additional layers of law in order to mitigate the ill-effects of dysfunctional older laws. At some point we will have to address the fundamental flaws.

Which is not to say that tax doesn’t help create inequality. By requiring payment of taxes in money, rather than in labour, the state colludes in keeping the poor subservient – because it is effectively obliging people to obtain money from others who have no obligation to part with it – and that subservience is a significant factor underlying in-work poverty and insecure work. So, for me, a radical restructuring of the tax system would start with recognising that it is iniquitous for the state to demand taxes in a form which people have no natural capacity to supply.

I can see the arguments for doing whatever is possible within the current system to improve things, but, if you’re arguing for ‘a real restructuring’ of the system, I think you need to start from a vision of where you want to end up. To my mind, the tax system exists in order to match the contributions that individuals can reasonably be expected to make, to the cost of providing the services that the public can reasonably expect government to supply. In a healthy society, that’s all it should do and treating it as a method of redistribution will distort that function.

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By: Jeremy Fox https://neweconomics.opendemocracy.net/fairer-income-tax-means-thinking-about-more-than-the-top-rate/#comment-102 Thu, 23 Feb 2017 11:09:00 +0000 https://www.opendemocracy.net/neweconomics/?p=763#comment-102 Ok. Got it!

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By: Adam Ramsay https://neweconomics.opendemocracy.net/fairer-income-tax-means-thinking-about-more-than-the-top-rate/#comment-101 Thu, 23 Feb 2017 09:46:00 +0000 https://www.opendemocracy.net/neweconomics/?p=763#comment-101 I don’t think anyone is suggesting that level of residential property tax in London. The Scottish Green proposals was a residential property tax with a level set by local authorities. 1% is the average level at which this would be roughly revenue neutral vis-a-vis council tax in Scotland; and the proposal would also free up a bunch more money for council tax relief, because it would be more proportional than the vastly out of date valuations done in the early Nineties. But the policy wasn’t even that the rate should be uniform across Scotland, never mind London!

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By: Jeremy Fox https://neweconomics.opendemocracy.net/fairer-income-tax-means-thinking-about-more-than-the-top-rate/#comment-100 Wed, 22 Feb 2017 12:47:00 +0000 https://www.opendemocracy.net/neweconomics/?p=763#comment-100 Totally agree on the need for a more progessive income tax regime – and not just in Scotland. But the Greens’ Residential Property Tax proposal (1% on market value) is daft or at least would be if applied to London. In our street, there are people who have lived here for 30 years when the average house cost £40K. They now sell for £1.25million. Under the Greens’ proposal the RPT here would be circa £12,500 p.a. – okay maybe if you work in the City but enough to rid the street of anyone on the Green’s median salary. The net effect would be even more gentrification and the uprooting of whole communities.

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