Rachel Reves is increasing pressure to find new ways Promote sick economy The government reached the second June figure since 1993 last month after borrowing.
Many predict now Government’s policy on deduction in welfare spending And returning the winter fuel payment.
At the same time, calls are also increasing to an ax ax to the profit cap of two-children-a tori-era policy that experts say that 400,000 keeps children. poverty And vice versa LaborMission.
These policy decisions associated with a difficult economic background will require funds from somewhere. Chancellor Till now the labor manifesto is stuck for commitment Taxes For working people, which means twics for national insurance, income tax and VAT.
This means that more creative twics may be under consideration for its next autumn budget, already inheriting and constructing changes made for levy such as national insurance of employers.
One option is the increasing number of campaigners is a ‘one’Property Tax ‘, an economic policy is adopted by very few countries which focus on ultra-rich. Here you need to know about this idea and what experts say about it:
What is money tax?
A money tax is a direct levy on a person’s total net property – things like property, investment, cash and other property. Unlike most regular taxes, this idea is to target accumulated money, rather than income earned that year.
Apart from being a new way to increase revenue for the treasury, policy is also designed to rebuild funds. Reduce economic inequality.
There are already some taxes in the UK that focus on assets, such as inheritance, capital gains tax and council tax. Any of these Twicing can also be on the table for the Chancellor later this year.
Capital gains tax is similar to a money tax, in which it sees the levy levy imposed on the sale of an asset. However, most models of money tax will see an annual fee based on the value of the assets held, even if they are not sold.
The idea of a money tax has proved to be divisive among economic experts, with its impartiality, the ability to increase revenue and the ongoing debate around.
Can a money tax work work in Britain?
Preachers say that a money can generate significant amount for tax ShockingOnly affecting a small number of individuals, which are less likely to feel the stings of high receipts.
Tax Justice UK is calling for two percent levy on individuals whose assets are more than £ 10 million. They say that it will affect 0.04 percent of the population, while collects 24 billion pounds per year.
Calls come at a time when the assets of ultra-rich in the UK have increased extensively in recent decades, while there is a standard of living. Dropped for people with lower middle-oriented,
Sunday Times The Rich List recorded 171 UK billionaires in 2023 – above 15 in 1990. At the same time, now the UK has a record number of poverty children, and uncertain Living in temporary housing.
The author and host, the author and host of the Macrodeo Podcast, James Meadway, said that a money tax should be seriously considered by the Chancellor: “This starts chipping away from the idea that we are going to allow the money to be stacked forever in very few hands.”
Responding to criticism that a money tax will be threatened Investment In the UK, the economist said: “The investment has fallen from a rock amid breaks and financial crisis. Sixty percent of the money is inherited in the UK. It’s not anything that is designed to close and establish a new business by someone.
“If these people were good, then our economy Will be better. This is not better, so they are not so good, so it does not matter so much. ,
He said: “It is not going to solve every economic problem, but there is no number to smell 24 billion, if you are now looking at the government how you are going to continue NHS, then how are you going to pay not to pay a large scale profit, how are you going to get rid of two child benefits cap.
“There is a complete pile of things that we can do with the money that is not being done in minutes because it is just sitting in the hands of very, very rich people.”
What are the issues with money tax?
One of the most difficult factors in calculating the benefits of any money tax is what behavioral reaction will be. While a money tax will raise a lot of money in any scenario, this uncertainty means that it is difficult to model.
A normal anxiety is carried forward, the risk of ‘capital flight’, where rich people – who are more mobile globally – just leave the UK, or at least transfer some of their own property.
Money can also be conducted in various types of assets, anything from cars to art, which means that it can be difficult for tax authorities to know how to apply the levy.
Dan Needle, founder of Tax Policy Associates, said it is very uncertain how much can be raised by implementing money tax. Although it is difficult to estimate how many rich individuals Britain should leave, this measurement should be applied, tax experts say that just ten can reduce revenue to billions.
This is because 15 percent of the estimated yield will come from only ten ultra-rich people, while 80 percent will come from less than 5,000.
With the risk of capital flight, Mr. Needle argues that a money tax will be on a large scale in the UK.
He explained: “If you are doing something, you get less than this-always. All taxes are closed; All you should be clear about what they are. With money tax, you are taxing on savings and investment, so you get less savings and investment.”
Tax experts point to the US and Germany with money tax modeling, which found that the long -term impact GDP had a decrease of two percent and five percent respectively. This will be harmful to the economy and will give a tough competition to employment.
“We need to answer what we want to do, but what they really do,” said Mr. Needle. “There are many ways that you can improve tax and can do rich in a way that does not harm the rest of us.” These may include improvement in land tax, capital gains tax and inheritance tax.
Any of these is probably a more possible option for labor than a money tax. But as an autumn approach, the call will only grow loudly for some forms of more redistribution measures.
