Thursday, 12 February 2015

The poor pay more tax than the rich

In my last post I wrote that the rich should pay more tax. The balance of the tax burden in the UK is unfair on the poorest. The poorest 10% of households pay eight percentage points more of their income in all taxes than the richest – 43% compared to 35%.  Yet, when we talk of tax it is the wealthy who scream the most.  They have become the untouchables. We can't increase tax else they 1) won't pay it (increase in tax avoidance) and 2) it is a disincentive to the 'wealth creating' rich. And so it is that the poorest have shouldered the greatest burden of the recession and it is the poorest who have payed in taxes and cuts in benefit. Is that fair? No.  Does it feature in any of the key messages from the major political parties? No. This also is the problem.

We need to bring back into focus social justice at the heart of measuring outcome of economic strategy. To grow the economy is not in itself sufficient to ensure social justice. The rich simply get richer. Of course growth is important, but we must all have a stake in that growth. Currently the poorest do not.

More than one in four children is growing up in poverty in the UK today - 3.5 million children. But in some areas of the country it is between 50 and 70%.  Two-thirds  of children growing up in poverty live in a family where at least one member works.  This is unacceptable. But does any political party put it at the top of their strategy for dealing with the economy? Sadly, they do  not.

Labour has something to shout about. During the last Labour government child poverty fell. Child poverty reduced dramatically with 1.1 million children lifted out of poverty. This reduction is credited in large part to measures that increased the levels of lone parents working, as well as real and often significant increases in the level of benefits paid to families with children.  The recession and austerity has reversed that trend. The poor are getting poorer. It is an unfair prospectus and it is time we had a party speak up for them.

The current focus on tax avoidance by the richest is a good thing, but only if it now translates into a movement for fair taxation.




Read Ray'a Novel: It wasn't always late summer 

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