Prime Minister Burnham urged to introduce a wealth tax
In the United Kingdom, the Compass think tank has proposed that Prime Minister Andy Burnham tackle inequality through a wealth tax, free personal care and the transfer of gas and electricity networks into public ownership. As The Guardian World reports, the proposals are set out in the report Ending Business as Usual, which contains 70 policy options from 15 left-wing thinkers.
Compass stressed that the document is a list of possible solutions rather than an election manifesto. Other proposals include limiting political donations to £50,000, abolishing the House of Lords and introducing a package of measures to reduce the cost of living.
Tax initiatives
The report’s authors propose introducing a tax on net assets worth more than £10 million. According to Caitlin Boswell of Tax Justice UK, this could raise around £24 billion annually.
The report also considers aligning capital gains tax with income tax. According to the estimate cited, this step could provide an additional £11.3 billion per year — an amount that, as noted, would be enough to build 90,000 new social housing units. At the same time, the Institute for Fiscal Studies warned that equalising the rates could reduce overall tax revenues and investment, as well as encourage wealthy people to move funds abroad or leave the country.
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Another idea is to replace council tax and stamp duty with a proportional property tax. According to the report’s estimate, 23% of households would pay more, mainly in London and south-east England.
Care and energy
Social initiatives for England include free personal care, including assistance with washing, dressing and eating. Sebastian Rees of the Institute for Public Policy Research proposed funding this through a 1% income tax surcharge for people over 40 and a levy on housing value. In his estimate, such a surcharge could raise between £8 billion and £9 billion annually.
The report also provides for the possibility of covering care costs with the value of a property and recovering the funds after the home is sold or the owner dies. Chris Hayes of Common Wealth proposed transferring the management of energy networks to state-owned companies and creating regional energy councils. In addition, the document includes a proposal for universal free childcare.
