Build back fairer: tax the rich!

Submitted by AWL on 10 May, 2021 - 6:53 Author: Sacha Ismail
Covid and wealth inequality

Robert Watts, who compiles the Sunday Times Rich List of the thousand richest individuals and families in the UK, feels obliged to comment on the 2021 List: “The fact many of the super-rich grew so much wealthier at a time when thousands of us have buried loved ones and millions of us are worried for our livelihoods makes this a very unsettling boom.”

There are now 171 billionaires in the UK, up from the previous high of 151 in 2019. Their wealth has risen 21.7% during the pandemic, to £597.2bn.

Between 2008 and 2009, the total wealth held by the Rich List fell as a result of the financial crash (though the top entry still held over £10bn in wealth, while the tenth richest held £1.5billion). Every year since, while individuals and families moved around, the Rich List’s wealth increased substantially — until 2020.

There was a fall last year as a result of the pandemic, but much smaller than the one after the financial crisis — from £143.5bn in the hands of the top ten in 2019 to £131.5bn in 2020, compared to £82.6bn falling to £47.7bn in 2008-9. And this time the UK’s super-rich have made up their lost ground faster, with the top ten on the 2021 list reaching £154bn.

In 2019 the top-rankers were Sri and Gopi Hinduja, with £22bn; last year James Dyson and his family, with £16.2bn; this year Leonard Blavatnik, with £23bn. In 2019 Blavatnik held £14.3bn in wealth and last year £15.8bn. The tenth richest on the 2021 list has £11bn. (By the way, none of these figures include money in personal bank accounts.)

Already in January, looking at the figures from previous Rich Lists, the Resolution Foundation (broadly right-wing Labour but thoughtful) calculated that the concentration of wealth in the hands of the super-rich was much worse even than previously estimated — by a margin of around £800 billion in total! Meanwhile the worse-off and economically-insecure have been hammered, and will be hammered more as furlough tapers off and the government seeks to “re-balance” its budget after emergency payouts.

As the Financial Times put it on 19 May: “Boris Johnson’s new legislative programme hammered home the point. Among the items missing were the overdue plan to fund social care; any move to raise statutory sick pay from the low rate of £96 a week... and the long-awaited employment bill strengthening protections for workers. One could also cite the meagre one per cent pay rise offered to nurses”.

The trend to spiralling inequality is built into capitalism, and can only be comprehensively and sustainably tackled by abolishing the super-rich along with capitalism. The labour movement should set itself that goal; and we should also fight for emergency measures to check and reverse the spiral.

Even middle-of-the-road political figures are now proposing “wealth taxes” — taxes on accumulated wealth. We need a range of measures to assault the wealth of the super-rich from all sides — both to fund policies to improve the lives of the majority and to diminish inequality as an end in itself.

As the “Build back fairer: attack poverty and inequality” motion Momentum members voted to promote for Labour Party conference puts it:

“We need to take back wealth, with a wealth tax, increased corporation tax, capital gains tax and taxing very high incomes; and taking banking and finance into democratic public ownership.”

Alongside the fight to tax and take control of wealth “from above”, through government measures, we need to build up, transform and mobilise our trade unions, to make them powerful instruments “from below” both to fight for these policies and to redistribute wealth away from the super-rich.

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