Whatever the make up of the next government – one thing is for certain – it will need to find more revenue. All parties are committed to deficit reduction, and as services and benefits have already been cut to the bone, the only way is to increase taxes on those who can afford it most. Raising taxes is always politically tricky – here’s how to pull it off:
1. Focus on the richest – the top 10% in either income or accumulated wealth. Don’t put up taxes for anyone else – you need as many allies as you can get.
2. Clearly explain what the top 10% means – the top 10% of households have at least £967,000 worth of wealth, in pension funds, property and possessions (compared to total wealth in the bottom 10% of households of £13,000. The top 10% of earners make at least £53,040 a year. Just because someone doesn’t ‘feel rich’ doesn’t mean they aren’t.
3. Point out that most people are not rich – only 19% of taxpayers pay higher rate income tax (meaning than they earn more than £41,000. The average UK income is £26,500. If you’re lucky enough to own your own home (36% of us don’t), the average house price is £250,000. The idea that someone earning £60,000 and living in a £600,000 house is ‘ordinary’ in wealth terms is laughable.
3. Don’t be waylaid by sob stories – many people will come forward to say they are not really rich / are on ‘ordinary salaries’ / have worked hard / deserve a break. Stick to the facts – these are people with substantial disposable wealth and when the country needs additional funds it is better to raise them from increasing taxes on this group than by cutting spending on the poor, cutting services for everyone or increasing public borrowing. Continue reading