Latest news with #GreenNewDealRising
The Guardian
a day ago
- Business
- The Guardian
Climate groups call for UK wealth tax to make super-rich fund sustainable economy
A growing number of climate groups are campaigning for the introduction of a wealth tax to ensure the transition to a sustainable economy is not done 'on the backs of the poor'. Last week campaigners from Green New Deal Rising staged a sit-in outside the Reform UK party's London headquarters as part of a wave of protests targeting the offices, shops and private clubs of the super-rich across the UK. The Pay Up campaign – backed by more than 20 civil society groups including Friends of the Earth, the National Education Union and Tax Justice UK – is calling on the government to bring in a series of wealth taxes as an alternative to spending cuts. It is one of a number of campaign initiatives focused on overhauling the tax regime being run by climate groups who say the revenue from the ultra-rich could fund investment, restore crumbling public services and help tackle the climate emergency. 'Fixing our broken tax system so that it finally taxes those who earn their income from assets and wealth at the same rates as the majority of the population, who earn their money from work, is the fair thing to do,' said Hannah Martin, a co-director of GND Rising. 'We must tax the booming fortunes of the super-rich to rebalance our economy and fund investment in our communities, our schools, libraries as well as much-needed climate action.' The campaign aims to highlight the growth in extreme wealth held by individuals and corporations in the UK. It calls on the government to introduce a 2% tax on assets over £10m, shut down tax loopholes and increase the tax paid on property and shares so that capital gains tax is equal to income tax. It is also urging the government to stop using public money to bail out big polluters such as failing water companies and fossil fuel firms. Tax experts at the Tax Justice UK campaign group say a 2% tax on wealth above £10m would raise £22bn every year, and the other tax changes advocated for by GND Rising could raise an additional £50bn in a single year. Martin said: 'Climate campaigners are calling for wealth taxes because we have been told for years that 'there's no money' to tackle climate change. But we can see along with the public there is enough money and it is being hoarded by the super-rich and polluting corporations. We need to unlock that wealth to tackle climate change and the cost of living crisis, and that means focusing on the government's tax policies to win that change.' There has been a growing clamour for a wealth tax in recent months from some economists, thinktanks and trade unions. In recent weeks prominent Labour figures including the former leader Neil Kinnock have added their voices. Opponents, the super-rich and their advisers and supporters, have raised concerns that such a move would result in the ultra-wealthy leaving the country, a narrative that has been amplified by a blizzard of news stories over the past year. However, experts say there is no evidence of a mass millionaire exodus from the UK, with the overall number of millionaires and billionaires having risen steadily over the past two decades. At the same time most people are faced with stagnating wages, rising living costs and decimated public services. Zack Polanski, who is standing to be the new leader of the Green party, agreed there should be a wealth tax to ensure the ultra-wealthy – who are also the largest emitters – pay their fair share to tackle the climate crisis. He argued that under the current plans to reach net zero emissions by 2050 the poorest in society were being asked to 'step up to tackle the climate crisis'. Sign up to Down to Earth The planet's most important stories. Get all the week's environment news - the good, the bad and the essential after newsletter promotion 'This is an emergency,' Polanski said. 'The government have a series of choices – and right now they are choosing to subsidise dirty and dangerous parts of the economy like aviation, oil and gas. They should instead ensure that the greenest option is always the cheapest. How dare they say there's no money left at the same time they also refuse to tax the super-rich?' GND Rising's Pay Up campaign staged a day of action last week during which more than 200 young people targeted sites connected to Britain's ultra-wealthy, including the billionaires Jim Ratcliffe of Ineos, the Reform treasurer Nick Candy, and the founder of Bet365, Denise Coates. It said it intended to step up its campaign for a fairer tax system over the summer. Martin said climate action 'must speak to the reality of people's lives and their anger at the inequality they are seeing in their communities'. 'The climate crisis and economy inequality are two sides of the same coin, because it's the same broken system making billionaires richer, fuelling the climate crisis, and leaving working people to pick up the bill.' She warned that unless climate campaigners showed that climate action was 'also about fixing inequality and the cost of living crisis, we risk our demands being dismissed as a 'nice to have' by politicians, ignoring the very real pain people are facing, and opening up our agenda to attacks by climate deniers like Reform'.
Yahoo
19-05-2025
- Business
- Yahoo
Is it time for a wealth tax in the UK?
The combined wealth of the 350 richest individuals and families now stands at £772.8bn, according to the latest Sunday Times Rich List. The rankings — released on Sunday — count vacuum innovator Sir James Dyson, musician Dua Lipa and King Charles among the UK's richest people. While some read the list out of fascination, or even for inspiration, campaign groups like Green New Deal Rising see the list as fuel for protest. The UK grassroots movement is fighting for the government to accelerate its response to the ever-growing threat of climate change — and it thinks the fairest way to do that is to tax the UK's wealthiest people. On Friday, the group stationed itself outside one of the UK's most exclusive private members club - White's in Mayfair, central London - to get its point across. It argues that while the club thrives, the UK has lost two-thirds of its youth centres, instrumental hubs in teaching vital skills to younger people as well as alleviating crime and poverty. "Just weeks ago, this government was dealt a huge electoral blow in the local elections precisely because cuts to the winter fuel payments were so unpopular," Hannah Martin, co-director of Green New Deal Rising, told Yahoo News. "And yet, last year, British billionaires added £35m every single day to their fortunes. Our outdated tax system barely taxes this wealth, allowing ultra-wealthy individuals to pay much lower overall tax rates than ordinary people. "Instead of asking the super-rich and corporations to finally pay up to fund schools, hospitals, affordable homes and action to tackle the climate emergency, this government is choosing to pile more cruel and unnecessary cuts on the most vulnerable members of our society," she added. But it's not just members of campaign groups who are calling for a taxation overhaul. A growing number of MPs, and even some millionaires themselves, are calling for a tax increase. Here's why they think a wealth tax should be put in place — and why and how it would work. While some readers may remember the pre-Margaret Thatcher top tax rate of 83%, over the past few decades, taxation for the upper band of earners has hovered around the 40%-50% mark. Currently, in England and Northern Ireland there are several tax bands. Those with a tax-free allowance of £12,570 do not pay tax. After this point: For those who earn up to £50,270, they pay a basic rate of tax at 20%. For those earning between £50,271 and £125,140, that figure doubles for anything earned over £50,271, putting them in a higher tax rate band of 40%. The highest band in place, the additional tax rate, is at 45%, for earners above £125,140. In Scotland, a higher tax rate is in place for those earning above £125,140, at 48%. While these rates should absorb a large chunk of earnings from those with top incomes, in reality the system plays out a lot differently. Some wealthy individuals often circumvent high tax rates through a combination of legal tax avoidance strategies, sophisticated planning, and the use of financial structures that are less accessible to the average taxpayer. "The UK's unequal tax system is stacked in favour of the super-rich, fuelling this inequality," a report on wealth taxation from Tax Justice UK and Patriotic Millionaires in March 2025 said. "Unfair loopholes and far lower rates of tax on income from wealth than work mean the wealthiest in our society often pay proportionally lower taxes than the average person, ensuring they get richer at a faster rate." Taxes on work currently bring in almost half of all government tax receipts, while taxes related to wealth, such as capital gains and stamp duty, are only set to bring in £1 out of £25, the report added. Former prime minister Rishi Sunak, who is in one of the 250 richest families in the UK, paid just 23% in tax in 2023 on his £2.2 million in earnings — a lower rate of tax than a teacher sitting in the higher tax band. One of the co-authors of the report is one of the largest proponents of a wealth tax, but some may find their membership surprising. Patriotic Millionaires advocate for a progressive policies and tax reform — and happen to be millionaires themselves. Members of the group include economist and former banker Gary Stevenson, musician Brian Eno, technology entrepreneur Gemma McGough and investor and lawyer Julia Davies. They claim that the UK has missed out on £160bn by not instating a wealth tax — a figure reached if the government had instated a 2% levy in the last 32 years. Formed in 2021, the growing network formed a decade after the formation of the original US branch of the group, which includes Disney heir Abigail Disney. In a unique position, Patriotic Millionaires surveyed 501 millionaires to hear their views on a wealth tax. The 2024 survey showed that 65% wanted to be taxed more. "Given our current tax revenue is made up of 63% taken from income and consumption and only 4% from capital it really is time to rebalance the books," former EU anti-trust lawyer and Patriotic Millionaires member Stephen Kinsella told Yahoo News. "We can't keep unfairly expecting working people, small businesses, and the most vulnerable in society to pick up the pieces of a broken economy, we have to look towards a sustainable and fair solution. That means taxing the super rich," he said. The group argues for a 2% wealth tax on those with assets more than £10m. They calculate it would generate £24bn a year for public services and national investment, with those affected — 0.04% of the population — still getting richer. "When people like nurses and teachers are paying the same tax rate as multi-millionaires, it's clear the system is rigged in favour of the super-rich. We need to tax wealth more and tax work less. When even millionaires like me are begging to pay a wealth tax, what is the government waiting for?" he said. Kinsella also points out that even with increased taxation, the amount of disposable income available to a millionaire means that their profits can easily outweigh the impact of increased taxes. He said: "An individual with wealth of £11m would, under our proposal, only pay a 2% tax on the excess over £10m, ie 2% on £1 million = £20,000. "But over a year, if sensibly invested with a return of 5%, that £11m would have increased by £550,000, so their net wealth would still have increased by £530,000," he added. This is not to say that every organisation is in step with this line of thinking. Think tank the Institute for Fiscal Studies has previously criticised the practical difficulties of implementing a wealth tax and the stark international successes to date, with only Switzerland considered to have successfully implemented a wealth tax. There are also concerns that a wealth tax could encourage avoidance behaviours, such as moving assets offshore or restructuring ownership to fall below thresholds. Other representatives from the right-wing think tank, the Institute of Economic Affairs (IEA), have argued that this 2% tax model could even result possible exodus of wealthy individuals and capital from the UK. Kinsella strongly disagrees with this view. "Reports that there's an exodus of millionaires are false, based on flawed data and completely miss the point - that it's high time we started focusing on making sure this country works for everyone, not just a handful of rich people," he told Yahoo News. "Even if 10,000 millionaires left — like some have claimed — it's only 0.3% of the UK's millionaires - and if we properly invested in this country, we'd create opportunities for plenty of other people to replace them. "The idea that the majority of people who have built their lives here, who have children in school, who love the creativity, community, and life that the UK has to offer are going to up sticks is simply not true. Millionaires I speak with are desperate for the UK government to build a stronger, fairer, and more sustainable economy which will lead to greater investment. "To do that we have to tax the super-rich," he added. When similar suggestions about a wealth tax were made in the past, they were often seen as left-field and implausible. In fact, in 2020, then-chancellor Rishi Sunak said he believed there would never be a time for a wealth tax. While Sunak's thinking is in step with a Conservative viewpoint, even in 2015, the London School for Economics' Professor Alan Manning wrote that it had been 50 years since a wealth tax had been seriously considered in the UK. But after the Covid-19 pandemic, the arguments for introducing a wealth tax grew increasingly more plausible. Public sector borrowing and debt remain at historically high levels, largely as a result of the extraordinary government spending during the pandemic to keep the UK afloat. In the financial year ending March 2025, the UK's current budget deficit was provisionally estimated at £74.6 billion, which is higher than the previous year and well above pre-pandemic averages. While the current Labour government has pushed fiscal responsibility to the top of its agenda to hack away at the deficit, it has arguably had to do so at the expense of several unpopular policy decisions, including axing the winter fuel payment for all pensioners, cutting £5bn from the welfare bill, as well as reducing aid spending from 0.5% to 0.3% by 2027. Imran Hussain has been the latest MP to speak out against the government's planned cuts and argue for the introduction of a wealth tax instead. Last week in Parliament, the Bradford East MP said: "Thousands of my constituents continue to be fearful about the announced welfare cuts, and disability organisations have warned that hundreds of thousands of people will be pushed into poverty. "So I say to the chancellor: we must make the right political choice. We must protect the most vulnerable in society and introduce a wealth tax so that multimillionaires and billionaires can pay their fair share." Kinsella from Patriotic Millionaires echoes this view. "I welcome support from MPs including Imran Hussain who agree that a wealth tax is a clear alternative to cuts. Keir Starmer was clear that those with the broadest shoulders should bear the heavier burden," he told Yahoo News. "Any hesitancy within the Cabinet that might exist is misplaced and doesn't reflect the sentiment on their own backbenches. The time for bold action on tax is now — in the first half of this government's term."
