Bank Bailouts and Bonuses: tax the rich some more

We’ve bailed out the banks in the tune of £1.4 trillion ( Leaving us with a massive deficit and vast amounts of debt, that we, the ordinary tax-payer, have to fork-out.

The graph below shows how much was raised and spent by the government last year. It is the ordinary tax payer who is bearing the brunt of an unfair and unjust economic system.


The State is spending significantly more money than it raises in taxation, and is having to meet the gap – the deficit – by borrowing at record levels.

Last year, the government borrowed £1 in every £4 that it spent, and the UK currently spends some £43 billion on debt interest, which is more than it spends on schools in England.

It’s a disgrace, more than that it’s completely unacceptable.

How is it fair that those on the lowest incomes in society – roughly 75% of the population – pay more, proportionately, towards the government deficit than the richest 1% do?

And yet corporation tax and business rates contribute a miniscule amount to government revenue.

Just by looking at the graph above its clear to see how disproportionately our tax system operates.

This year, after all their talk about minimising the effects of the deficit by reducing government debt, the coalition government enacted a conservative policy to lower corporation tax from 28% to 23% by 2014.

Cutting corporation tax is emblematic of the way the government views the situation. Protect the rich and leave the rest of us to face their ‘austerity measures’ – a depressing future with few job opportunities and a shrinking welfare system.

And now they’ve decided to give tax breaks to millionaires.

How do the Conservatives suppose to reduce the deficit if it is slashing corporation tax and income tax on top earners? Spending cuts in the public sector.

While allowing the rich to get even richer the poor are increasingly going to get poorer, with cuts to benefits and public services.

We all know that youth centres are shutting; schools are loosing huge sums of money from their budgets; doctors and nurses can expect pay freezes; legal aid is falling by the wayside; the downsizing and private sponsorship of fire brigades; and privatisation of more public services; to name just a few of Cameron’s and Osborne’s policy changes to the government budget.

The divide between the richest and poorest members of our society has grown over the last few decades and this is their response. This needs reversing urgently.

And if they don’t, be warned, expect more riots.

Last May George Osborne, a millionaire in his own right, announced that the government would cut corporation tax in a bid to rebuild Britain’s position as an international financial centre.

Claiming that increased competitiveness will attract investment in the U.K and hence boost government revenue.

The Exchequer Secretary to the Treasury, David Gauke MP said:

“In recent years, too many businesses have left the UK amid concerns over tax competitiveness. It’s time to reverse this trend. Our tax system was once viewed as an asset. And it needs to be an asset again. That is why the Government is prioritising corporate tax reform. Responding to the concerns of business, the UK is headed for a more competitive, simpler, and more stable tax system in the future, creating the right conditions for investment.”

This reduction in corporation tax is a way of opening the door further to the wealthy and wicked, so the rich can get even richer, and the poor, well, reducing corporation tax is pretty much a lets-just-not-worry-about-the-poor policy.

I’ve never accepted the old fable that cutting taxes for the richest corporations increases competitiveness and therefore brings greater prosperity, which in turn trickles down to the poorest in society.

It’s a fallacy – a hoax – a way of tricking people into  believing that it is somehow beneficial to the Commonwealth not to tax the rich in order to provide essential services to everyone, especially the most vulnerable members of our society.

As for the idea that big business and corporations will up and leave the U.K economy if taxes are too high, it’s a lie.

There’s too much at stake for them to leave everything behind and re-centre their entire company holdings, their staff and management teams and move abroad. The costs are immense; time, money and a whole load of bureaucracy.

Unless of course there are tax loopholes, like offshore accounts. Then this fraud must be investigated and stamped out. Clamp down on tax evasion and close off any loopholes.

Some might take flight, finding the benefits of moving abroad out way the costs of paying higher rate taxes, but if they cared enough about the people here in Britain they’d stay, and if they don’t care enough let them leave.

The argument that highering corporation tax will actually result in less government revenue for the State simply because corporations will move away or engage in more tax evasion techniques only goes to show we should be uniting in our efforts to stop tax evasion and capital flight, and is definitely not a justification for cutting corporation tax or income tax on top earners.

The government should be increasing (not decreasing) corporation tax and personal income tax on the top 10% earners to generate a greater budget for expenditure on public services.

“But where’s the incentive to work hard and earn lots of money if it all gets taken away in taxes? I should get to keep everything I earn” I hear them cry.

Firstly, it’s not taking ‘everything’ you earn only a fair proportion of your wealth and income.

If you earn £1 million and 50% is taxed that still leave’s you with £500,000, much more than a lot of the population ever get close to earning in a life time.

And yet this illegitimate Con-Dem government has just slashed the 50p rate of tax to 45%; they should be increasing it not giving tax breaks to the super-rich.

Secondly, is it not from work that we derive meaning in our lives? Do you live to work or do you work to live?

In either case ‘work’ – and I don’t mean work in the narrowly defined realm of paid work – is the essence of our being.

There should be some solace in the knowledge that if we’re earning vast amounts of money the taxes we pay are helping those in need – the most vulnerable members in our society – through a benefit system that redistributes wealth equitably.

The problem is our taxes are being spent on illegal/immoral wars and our money used to bail out a corrupt banking industry.

Alongside the re-nationalisation of the transport, gas, electricity and utilities industries. It’s about time we re-nationalised our banks and re-claimed our government – so it becomes a government by the people, of the people, for the people – to ensure our taxes are spent wisely and our goods and services distributed equally.

And thirdly – although it often is – why is earning ridiculous amounts money the sole reason for working hard? Surely the incentive for working shouldn’t purely be based on the ‘profit motive’ and self-interest?

Isn’t one of the core motives for working a sense of accomplishment, providing a service and fulfilling a role in society? The foundations of working are grounded in the value and assistance we provide to others, leading by example as Che Guevara did.

Che Guevara always worked for the common good alongside his comrades in his fight for justice. He worked as an equal. He didn’t put himself on a level above others.

Not everyone is of course a Che Guevara but we should draw inspiration from his work ethic and revolutionary spirit.

There are countless people – often going without recognition – who dedicate their entire lives to the common cause, aiding those in need. It’s these people we should attempt to emulate.

We all need money to survive in this capitalist age we’ve found ourselves in, and I’m not saying people don’t have the right to earn a fair income or aren’t incentivised by money.

However, why should becoming filthy rich – on a grossly unequal level above others – be our incentive to work? It shouldn’t be allowed, let alone encouraged.

I propose a cap on personal income and wealth, and suggest that natural resources – such as water and energy – should be declared a ‘common heritage’ that no-one is allowed to profit from.

If you agree please like and share this article…


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s