Call for higher tax for super rich

5:22pm Sunday 7th September 2008

High earners on more than £100,000 a year should pay higher tax rates to help achieve greater equality between the rich and poor, the TUC has urged.

The union organisation said its research showed that an increase in the number of super rich had caused "immense harm" to the economy and society, adding that they were wealthier today than in Victorian times.

On the eve of the TUC Congress, due to open in Brighton on Monday, union leaders complained there had been a "surge" in wealth at the top which had overturned a century of progress towards greater equality.

The TUC said there should be a series of policies to reverse the trend, including a new minimum tax rate for those earning more than £100,000.

A minimum rate of tax, which the TUC argued should start at 32% for those earning between £100,000 and £150,000 and rise to 40% on salaries of more than £200,000, would not increase any tax rates, but would limit the tax relief and tax avoidance measures open to the well-off and could raise £5 billion, said general secretary Brendan Barber.

"The evidence assembled here is conclusive proof that the growth of the super rich is not just socially divisive and morally objectionable, but deeply damaging for the rest of the economy. The super rich have not created much in the way of extra wealth - they have mostly taken it from the rest of us. It's Robin Hood in reverse.

"Those suffering from the impact of the credit crunch should know that it was caused by the super rich taking risks with other people's money, pocketing the profits and passing on the inevitable losses.

"Any would-be first-time buyers should know who to blame for first the house price bubble and now the difficulties in getting a mortgage.

"It is time that the super rich started to pay a fair rate of tax. There is no point in putting up tax rates that they can avoid. The 54 billionaires living in Britain paid £14.7 million in tax on their £126 billion combined fortunes in 2006 - an average rate of a little over 0.1%. Our modest proposal for a minimum rate of tax will simplify the tax system and raise £5 billion."

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