The TUC has today (Thursday) declared that “we must put an end to the grotesque inequality of the Tory era”.
Ahead of its annual Congress in Liverpool this weekend, the TUC says the Conservatives have allowed Britain’s wealthiest to “feather their nests” while working people have suffered the worst pay crisis for two centuries.
The union body adds that the Conservatives have delivered a “broken economic model which rewards wealth, not work”.
With “living standards plummeting, public services on their knees, and rampant wealth inequality blighting every corner of the country”, the union body says fair taxation must be a key part of a wider set of policies to help “reset the economy to work for working people”.
The TUC is renewing its call for a “national conversation on taxing wealth and windfalls” to help build a fairer society and “fix broken Britain”.
Significant support for fairer tax
The call comes as the union body publishes new polling, conducted by Opinium, which shows significant cross-party support for increasing taxes on wealth and excess profits.
A clear majority (61%) of the public think wealthy people should pay more tax than they are now – including over half (53%) of Conservative voters in the 2019 general election.
Only 4% of the public think wealthy people should pay less tax.
There is significant backing for increasing capital gains tax too.
Around 3 in 4 (72%) think capital gains should be taxed at the same or higher than income tax – including 73% of Conservative 2019 voters.
There was also huge support across the board for windfall taxes on excess profits:
The TUC has already called on the government to equalise capital gains tax with income tax which could raise over £10 billion – and it has supported a bigger windfall tax on energy companies.
Recent TUC analysis set out options for taxing the wealthiest 0.3% with wealth over £3 million, £5 million and £10 million, excluding pensions.
It found a modest wealth tax on the richest 140,000 individuals – which is around 0.3% of the UK population – could deliver a £10.4 bn boost for the public purse.
The TUC warns that huge inequality has “become the norm” in Tory Britain.
The ONS’ analysis of its Wealth and Assets Survey shows that the richest 1% of households had wealth of more than £3.6 million, and the least wealthy ten per cent had £15,400 or less.
Of financial wealth, the ONS say the wealth held by the richest 1% of households was greater than for the entire bottom 80 per cent of the population.
At the same time, CEO pay is booming, with the bosses of the UK’s 100 biggest listed companies collecting an average £500,000 pay rise last year.
City bonuses have been at a record level for the past two years. And banks and energy giants have been registering record profits too.
Worst pay crisis for two centuries
The TUC says working people are suffering the worst pay crisis in 200 years, which is contributing to the rampant wealth and income inequalities blighting every corner of the country.
Fifteen years on since the financial crisis, real pay is still down £360 this year compared to 2008. The average worker has lost out on a total of £21,600 since 2008, compared with wages just keeping pace with inflation.
And pay is not expected to return to 2008 level for at least another two years.
If real wages had continued to grow at the average pre-2008 rate of 2.3 per cent each year, the average worker would now be £280 per week, or £14,600 per year, better off.
Time for an economic reset
The TUC is calling for an economic reset after years of Tory failure.
As well as growing inequality, declining living standards, and public services which have been cut to the bone, the union body says the Conservatives have presided over a boom in insecure work and an attack on workers’ rights.
In addition to fairer taxation, the union body is repeating its demands for stronger protections for workers, and calling for improvements including:
The TUC says these policies are hugely popular across the political spectrum – as various recent polls have shown.
TUC General Secretary Paul Nowak said:
“It’s time to end the grotesque inequality of the Tory era.
“As households across the country have struggled to put food on the table, energy companies and banks have registered eyewatering profits, and CEO pay has skyrocketed.
“The wealthiest have feathered their nests while working people have suffered the worst pay crisis in two centuries.
“Rampant inequalities are the direct result of a broken Tory economic model that rewards wealth, not work.
“We need a reset – and an economy that delivers better living standards for all – not just those at the top.”
On the need to kickstart a national conversation about taxing wealth, Paul added:
“Now is the time for a national conversation on taxing wealth and windfalls
“With living standards plummeting, public services on their knees, and huge wealth inequalities blighting every corner of the country, fairer taxes can help to fix broken Britain.
“But our current tax system isn’t fit for purpose. A nurse will pay a bigger share of their income in tax than a city trader does on profits from their investment portfolio.
“That’s not only absurd and unfair – it's bad for our economy and our public services too.
“The public overwhelmingly back increased taxes on the wealthiest and companies that have made massive profits.
“It’s only right that the wealthiest pay their fair share.”
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