Public Affairs

Trade Union Desk

Fair taxation adds representation

The ICTU’s John O’Farrell says that far from the perception that conservative views on taxes and regulation are being cancelled, such views are rampant.

If you believe what you read from this Tory government and its faithful stenographers, there is a wave of censorship excluding conservative voices and opinions. In universities across the UK, academics and experts are rigorously policed and intimidated by ‘woke mobs’, enforcing an orthodoxy across the professions and the media.

This is, of course, utter nonsense based on a sliver of evidence, but it plays well in the Government’s focus groups and in the minds of the readers of the Tory press who lap up culture war sabre-rattling now that Brexit is ‘done’ and there’s not much else to worry about.

A couple of years ago, the BBC Reality Check team sent hundreds of Freedom of Information requests to every university across the UK and found no books being banned, and a tiny number of talks cancelled, mostly affecting Tibetans or Islamists. There were a few attempts by some activists in student unions to ‘no platform’ groups or speakers, but most of these were overturned. Anyway, student unions are not public bodies but private clubs or membership societies, and have the same rights to exclude views they don’t like as any debating society, any gentlemen’s club or any newspaper.

“After the last year, no economic proposal should be off-topic.”

Indeed, there are certain views that are almost unspoken in UK media, unless it is to be subjected to distortion and ridicule. I don’t mean ‘contrarian’ opinions on Black Lives Matter, or gender identity, or the Irish Sea Border — I mean economics and social policies which affect millions more people more deeply than culture war spats. I mean the kind of contrarianism that worries the shareholders, or, ‘follows the money’.

Here’s a bigger scandal afflicting universities at a time when campus life has been rigorously cancelled by Covid: thousands of smart young English people have been excluded from university since 2016 when Gideon Osborne scrapped maintenance grants as ‘unaffordable’. This had a greater impact on lower-income applicants than hikes in tuition fees and saved what seems now a trivial amount, £1.6 billion.

Over the same period, Osborne handed out billions to the most comfortable through cuts to higher personal tax thresholds and lower capital gains tax, slashing corporation tax and effectively abolishing inheritance tax, and then de-fanging the watchdogs of public finances: “The heirs of the late sixth Duke of Westminster paid no inheritance tax on the bulk of his £8.3 billion family fortune following his death in 2016… The rest of his wealth had already been transferred to family trusts which largely passed on to his son Hugh, 28, without incurring inheritance tax.”

The UK has the lowest levels of public spending and the lowest levels of government revenue in all of high-income Western Europe, spending about £4,833 less per person than the average comparator, or over £323 billion for everyone in 2019. This low level of public spending is accompanied by low levels of revenue, most of which comes from the tax take, including social contributions.

We can break overall taxes into taxes on labour, taxes on consumption and taxes on capital to help us see where gaps arise. These categories can also reveal much about tax distribution and even more about values and reveal the primary sources of ‘under-taxation’ in the UK is labour taxes — i.e. taxes and contributions linked to wages, transfer payments and pensions.

The UK levied less than half the typical level of employer labour tax per person in 2018. Employer tax could similarly help rectify gaps in the UK — meeting average rates per person would have increased receipts by nearly £121 billion. For Northern Ireland, a per capita share of this increased revenue base would equate to just over £3.5 billion per annum. We could raise even more with equitable system of taxing property.

We could debate this, or not. A generation ago, agendaNi was one of the few Northern Ireland media outlets where a trade union case against cutting Corporation Tax could be published, because Tony O’Reilly saw cutting his press empire’s tax bill as a personal crusade and his newspapers set the ‘national tone’ on economics. The same newspapers banned use of the term ‘bubble’ from reporting the property boom. The same newspapers will speak out for wage freezes and corporate welfare in the months ahead.

Conservative views on taxes and regulation are not being cancelled, but rampant. After the last year, no economic proposal should be off-topic.

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