Paying for a fair and civilised society

7 Sep 2011

Tax need not be taxing according to the adverts but the politics of taxation are highly divisive.

Labour people are accused of class envy and told that too much tax will deter enterprise and will kill the goose that lays the golden egg without a scrap of evidence to support this assertion.

Governments should strike a balance between tax and wealth creation. That is why it is perfectly acceptable to introduce tax breaks for the greater good of creating jobs which allow people to be productive, buy goods and pay their taxes into the common pot.

But the case for fair taxation has to be constantly remade in every generation. The principle behind it is very simple - it is the subscription that citizens pay for a fair and civilised society.

Now, we could have lower taxes but with less effective public services, even if we always strive to maximise their efficiency.

With fewer tax-funded services people are forced to pay for them more directly and services cost more.

Take the American health system where lower taxes force those who can afford it to pay for private insurance. This results in a system where companies spend large amounts billing each other and where administration costs far exceed the NHS.

The advantage of a collective system is that such costs are pooled and we can generally access services when needed. In Britain we pay in and get most or even more of it back over the course of our lifetimes, depending on our luck in avoiding and evading ill-health and accidents.

Of course, the rich and major companies avoid and evade taxes. Google's boss recently expressed his amazement that his company only paid £8 million on £6 billion of revenues here in six years.

It was very encouraging, therefore, to see a wide variety of billionaires and tycoons in Europe and America advocating additional taxes on the rich so they take up a heavier share of the burden, which would then be fairer all round.

Sadly such views have not been greatly echoed in Britain. When this happens and something tangible is done about it by this government of millionaires we could then say that we are all in it together.

Newcastle Chronicle and Journal

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Promoted by Ken Childs on behalf of Ian Mearns, 12 Regent Terrace Gateshead NE8 1LU