Greens call for Tax Justice

The Greens plan to reshape the tax landscape in the UK to create greater equality.

Keith M Ross, Green Party Candidate for Swansea West, said, “With massive inequality in the UK today, the greens have policies to reform the tax system to make things truly fair for all.

“The UK currently loses out to the tune of approximately £15 Billion every year through tax evasion. To put this in perspective, this is 15 times the cost of benefit fraud. And that’s before you add tax avoidance, which is legal.”

The Green Party policies for taxation in their General Election Manifesto include:
– A new higher rate of income tax of 50% for incomes above £100,000 – Abolishing the upper limit for National Insurance contributions – Raising the lower National Insurance limit to the personal allowance rate (£6,475 a year, or £124.52 a week)
– Reintroducing the 10% tax band and the 22p basic rate.
– Increasing the main rate of Corporation Tax from 28% back to 30% and reducing the small firms rate back to 20%
– Raising the Capital Gains Tax rate from 18% to the recipient’s highest income tax rate
– Reforming inheritance tax, so that the level of taxation depends on the wealth of the recipient rather than that of the deceased. This will encourage people to distribute their property widely.
– Cracking down on tax havens and other methods of tax evasion and avoidance. In particular press for a transparent international accounting standard that requires companies to report on a country-by-country basis so that their profits can be located and taxed.
– Reforming Council Tax by making people in more expensive houses pay more and those in smaller ones less, adding an additional band at the top for the biggest houses. In the long run we favour moving to a system. – Promoting an international Financial Transactions Tax (a Robin Hood Tax) on transactions between financial institutions, and introducing unilaterally a small levy on foreign currency transactions involving sterling.

Keith Ross continued, “The aim is to increase the level of taxation from 36% of GDP in 200910 to around 45% in 2013. This would halve the gap between Government expenditure and revenues by 201314 (as the Labour Government proposes) and progressively close the gap thereafter.

The Greens point to a recent Canadian Study, ‘The Social Benefits and Economic Costs of Taxation’, which compared low tax countries such as the USA, UK and Canada, with high tax Nordic countries such as Sweden, Norway and Denmark.

The study found that Nordic countries have:
– Lower rates of poverty across almost all social groups
– More equal income distribution
– Higher pensions
– Greater gender equality
– More economic security
– Lower infant mortality rates and greater life expectancy
– A greater percentage of the population completing secondary school and university
– More trust among individuals and for public institutions
– Significantly less drug

Also, according to a widely used index of economic freedom, individuals in Nordic countries report more life satisfaction and are more likely to discuss politics with friends. Nordic countries rank much higher on an index of environmental performance, and the Nordic countries give significantly more in foreign aid than Anglo-American countries.

More details of the study at:
http://www.policyalternatives.ca/sites/default/files/uploads/publications/Na tional_Office_Pubs/2006/Benefits_and_Costs_of_Taxation.pdf

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