Richard Burgon MP: Why we need Wealth Taxes, not more cuts in the Autumn Budget

‘We need to recognise that the cuts and austerity that got us into this mess will not get us out of it’

The first Labour budget in 15 years comes at a time of deep crisis for people all across the country.

The Tories left behind a toxic legacy of plummeting living standards, stagnant wages and public services stretched beyond breaking point.

No one can deny the scale of the mess left by consecutive Tory administrations. But we also need to recognise that the cuts and austerity that got us into this mess will not get us out of it.

Labour was elected to solve the crises our communities face and that means breaking the austerity doom loop.

One crucial question for our new government is who should pay for cleaning up the Tory mess: those who have thrived in the past decade, or those who have borne the brunt of Tory policies?

While millions have struggled to make ends meet in recent years, the wealthiest have flourished.

The total wealth of UK billionaires has skyrocketed from £246 billion in 2013 to an astonishing £684 billion just a decade later. That equates to an increase of £120 million every single day for 10 years.

Yet in Government the Tories implemented a series of regressive tax increases that tried to pay for the economic crisis on the backs of the majority of people. Labour must stand for the exact opposite.

So instead of further austerity that will hit the poorest hardest, the wealthiest in our society should be made to pay to fix the damage caused by the Tories and to fund the investment our public services so desperately need.

That’s why this week I have brought a public petition to the Government ahead of the Autumn Budget on October 30th, calling for Wealth Taxes and not more cuts. So far, 50,000 people have backed this call.

The package of three progressive taxes that I’m proposing will specifically target the wealthiest, the tax advantages enjoyed by those who live off their wealth and the greedy corporations that have profited from the energy crisis.

The first is the introduction of a 2% Wealth Tax that would apply to any assets over £10 million, raising up to £24 billion annually. That would affect just 20,000 people, less than 0.1% of the population.

The next calls for the equalisation of Capital Gains Tax with Income Tax rates, so that those who live off their investments pay the same tax rates as ordinary workers who go out to work day-in day-out. That would generate an additional £17 billion.

The third measure would end the state subsidies that go to fossil fuel giants and to close the loopholes in the oil and gas windfall tax, raising another £4 billion.

These three measures alone would bring in an additional £45 billion per year, providing vital funds to rebuild our crumbling public services, invest in a higher-wage economy and boost people’s incomes.

The funds raised through wealth taxes could also tackle the deep inequality that plagues our society. It would be a very popular measure to make the richest pay and then to use the funds to combat child poverty and support pensioners for example by lifting the two-child benefit cap and reversing cuts to the Winter Fuel Allowance.

After so many years of austerity, cronyism, and corporate profiteering under Tory misrule, the new Labour Government has the opportunity to directly improve the lives of millions at the Autumn budget. Wealth taxes can help it secure the resources to do so.

• You can add your name to Richard Burgon MP’s petition calling for Wealth Taxes, not more cuts, in the Autumn Budget here.