Boris Johnson has already made it clear that the Tories have nothing to offer at this election other than misguidance about their Brexit deal. Feeble and confused promises about the NHS and schools suggest they still intend, if voters allow them, to shrink the state back to levels last seen in the 1930s. What Johnson and his cronies, both in the party and in the media, will be offering in shed-loads is criticism of Labour`s policies, particularly the ones relating to tax, but with planning and a united approach, taxation could become a key element in a Labour victory.
With Britain now the biggest player in the tax haven game, and losing at least around £30-40bn a year in lost tax revenue, Corbyn and his team must realise that bland promises about tackling tax evasion and avoidance will not suffice; voters have heard this many times from all parties with no real effect, so in order to have an impact the Labour manifesto should include precise details which then have to be repeated at every opportunity by every candidate. He or she should have the exact same figures to hand, from how much is lost every year in the UK to how many tax inspector jobs in HMRC will be created after the Tory and Lib/Dem cull in the coalition years.
McDonnell has already promised "the most comprehensive plan ever seen in the UK" to tackle the problem, with legislation necessary to force tax transparency on UK crown dependencies to reveal the owners of companies hiding assets. More voter-friendly policies can be added. Should the distinction between tax avoidance and evasion be ended, with both being made criminal offences? Similarly should it not be illegal to make financial gain from advising on, or creating, avoidance schemes? The honours system is clearly in need of reform generally, but ensuring no tax avoiders, or people working in companies avoiding tax, are included in the various honours` lists might be useful, and thought can be given, too, to whether tax avoiders should be able to hold any public office or be eligible for any form of national representation. Most definitely, with the news that almost three-quarters of companies given major contracts by recent Tory governments have operations based in tax havens, Labour should promise that all such companies will be refused any government contracts. Finally, a pledge that all Labour cabinet members will make their tax returns public would not go amiss either!
Then there are the proposals on income and corporation tax. Labour`s proposals to increase the rates of income tax on the top 5% of earners will be attacked, with ludicrous claims that the changes will ruin the economy, actually reduce the amount the Treasury collects, and dash the hopes of aspirational young people. Utter tosh, of course, but the likes of the Mail and the Telegraph will have a field day! Labour candidates will have to be ready with their prepared responses. For a start, this nonsense centres around the so-called Laffer curve which was dreamt up to justify Reagan`s tax cuts, and which modern economists like Thomas Piketty have been rubbishing for years. Labour`s candidates could do worse than remind voters that under Thatcher, between 1979 and 1988 the top rate of income tax was 60%! Did that end aspiration? Worth remembering too, is the pledge made by Johnson when campaigning to be Tory leader; he promised to raise the higher-rate income tax threshold to £80,000 from £50,000, meaning those earning £80,000, for example, would save £3000 in tax. It would cost, moreover, £9.6bn a year, and lead to more government borrowing, just to benefit the well-off, the ones earning three times the national average. All Labour candidates should learn the next figure off by heart: average income in the UK is £26,400!
Hopefully, Labour will have ready for all social media outlets available, responses from nurses, junior doctors, teachers and such like saying how the income tax rises will not affect them, with a few bankers and businessmen saying how much they earn and how much more they will pay. This would have even more effect if a few well known actors could play the roles, emphasising how little effect the tax increases would have on almost everybody. Similar publicity about the proposed VAT to be levied on private school fees will do no harm either. Waiting for the Tory propaganda machine, oiled this time by the duplicitous Dominic Cummings, to get its act together is not a wise electoral tactic, so Labour must, to use the rugby metaphor, "get its retaliation in first".
Tories will claim a corporation tax increase to 26% on company profits will be disastrous, economic chaos will ensue, causing businesses to leave the country in their hundreds, with thousands of jobs lost The Labour response should be quite clear; the Conservatives` reduction of corporation tax did not attract new businesses from abroad, nor has there been a surge in investment, whilst countries like Germany, Japan and France have far healthier economies even though their rate of corporation tax is around 30%. Instead of paying CEOs and directors obscene amounts plus bonuses for "performance" even if that entails job losses and lower productivity, companies need to be paying their fair share of tax, to ensure they continue to benefit from the government investment in health, education and transport.
Dealt with sensibly, with all candidates and members of the leadership team well prepared and using the same, correct figures and details, taxation policies can prove a vote-winner in the December election.
No comments:
Post a Comment