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MP calls for tax-or-charity reform
12th February 2008
How best to encourage a giving culture where more of us are incentivised to give a share of our income to good causes? The Labour MP Frank Field delivering the Allen Foundation Lecture has called for reforms to income tax so that the top income groups earning £150,000 or more would be given a choice - give some money to charity or face a 10 per cent tax surcharge. Field claims that the inspiration for his idea came from a conversation with Margaret Thatcher! The full text of his lecture is available here
He draws quite heavily on the statistics used by Robert Peston in his new book ‘Who Runs Britain’ and I have selected a few of them below
Some 30,000 people earn more than £500,000 a year and their average income is £1.1m’.
This top 0.1 per cent of British earners take 4 per cent of all personal earnings – a sum more than the entire economy of Vietnam that supports 84 million people.
Median earnings of the FT 100 top companies’ executives stands at £2 million – up by a fifth on the previous year
Grant Thornton, the accountants, established that in 2006 the 54 UK based billionaires paid income tax of £14.7m on a fortunate of £126bn.
Do this idea have legs? or should we regard it as another form of stealth tax on the super rich?
Is a reform of taxation the best answer? What are the alternatives?
Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.