In order for the UK to prosper as a nation we must reform the tax code to reduce inequality and boost opportunity. The Government must raise more revenue, predominantly from those with the greatest ability to pay, to support strong public services.
The notion that the UK should ‘compete’ with other countries to attract investment and wealthy companies and individuals by reducing tax rates and offering tax reliefs is both dangerous and misleading. The unavoidable truth is that UK economy is overly dependent on – and geared to the interests of – its finance sector. So often our partisan politicians equate the interests of the City of London with those of the country of the whole. But, in reality, many policies that protect the interests of the financial sector are detrimental to the living standards of ordinary men and women in the UK and jeopardise the success of other areas of the economy.
Instead of lining the pockets of large financial institutions we should look to the Scandinavian countries that are well-known for their broad social safety net and their public funding of services such as universal health care, higher education, parental leave, and child and elderly care. This high level of public spending will naturally require high levels of taxation. And this will be gained by:
- Introducing higher taxes on consumption through the VAT and higher taxes on middle-income taxpayers through higher social security contributions.
- Raising taxes on wealth and unearned income (such as capital gains tax, investment income taxes and inheritance tax).
- Resisting any attempts to cut income tax rates for high earners
- Increasing the corporation tax rate and the amount of tax revenues raised from company profits.