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Economy |
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We think the economy should work for everyone, not just billionaires, hedge funds and investment banks. We want to improve fairness in the tax system by closing tax evasion loopholes and reducing the gap between corporation tax and income tax. We want to create affordable housing for everyone, and to do this we will introduce a land value tax, adjust capital gain tax and introduce rent control. We want to help the lowest paid and we will by raising the minimum wage and encouraging everyone to pay the living wage.
The minimum wage should be set to the same value as the living wage (currently £14,458.50 based on 252 working days of 7.5 hours per day at £7.65), and automatically adjusted in line with that figure.
Tax laws and the tax system must be simplified. Much tax avoidance happens because the tax code is excessively complex and full of loopholes, so simplifying the system is a big step towards reducing avoidance.
As a general rule of thumb, tax policy should focus on simple direct taxation (such as income tax, corporation tax and land value tax) for the bulk of revenue raising, and use minimal indirect taxes to discourage certain activities (such as fossil fuel use, drug use, and so on).
The personal income tax allowance will be set at the level of a full time living wage and will rise inline with the living wage. This means that someone working a normal full-time job at the minimum wage would not pay any income tax.
Capital Gains Tax will be replaced by an Asset Tax, based on an annual self-assessment. It will apply to those whose assets amount to greater than £350,000. Debt, such as mortgages, will be offset against any assets and the remainder will be assessed as the taxable value of assets. This ensures those who accumulate wealth purely through accumulation of assets, rather than direct income, are contributing to the economy whilst avoiding an unnecessary burden on the average family.
The rate of Asset Tax for individuals will be harmonized with the rate of tax on earned income, and all allowances for each will be pooled, in order to ensure that work is rewarded and incentivised to the same extent as investment.
Investigate possible reforms to the way VAT is applied to goods and services with a view to making it less regressive and, ultimately, to remove the poorest from having to pay entirely. This may require renegotiating our obligations to the EU, which makes VAT compulsory for all member states.
Introduce a tax on financial speculation, commonly known as a "Robin Hood Tax". We will do this by joining the proposed EU Financial Transaction Tax1 system, which is planned to start in 10 countries across Europe during 2016 (including France, Germany, Belgium, Italy, Spain and Estonia). We would also work with international organisations to broaden such a regime beyond the EU.
Tampons should not be considered a luxury item and should be considered a necessity
We will support research into a universal basic income and its effects on society and the economy, with the aim of eradicating poverty and providing a basic standard of living for all.
Improve rental rights, such that residential tenants cannot be evicted if they are paying market rate rent and have not damaged the property. Create a general principle that for tenants a property is their home and core to their life, whereas for landlords it is but a piece of property and simply a financial asset.
Adopt Land Value Taxation (LVT)2, a charge on the rental value of land not including any improvements made on the site (such as buildings, drainage and services). Valuation to be based on market evidence, in accordance with the optimum use of the land within the planning regulations and updated regularly (at least every 2 years)34. LVT would replace Council Tax, Uniform Business Rates, and Stamp Duty. There will be two rates of Land Value Tax - a national rate and a local rate. The national rate will be decoded after consultation and research. The local rate will be set at the discretion of each local authority. Public open space, public transport infrastructure and open water will all be exempt from LVT. Local and national government property will not be exempt, to encourage the efficient allocation of publicly owned assets.
Personal income tax is calculated on income generated prior to expenses being deducted. But in business, corporation tax is calculated on any profit generated after expenses have been deducted from income. It is proposed that a study is conducted into the feasability and fairness of calculating them both in the same way: either personal income tax being revised and only calculated after household costs have been deducted (ie taxing household surplus or amount put into savings rather than income), or corporation tax being calculated on the basis of revenue alone.
Given that there is a current tax gap (between tax due and tax recieved by the exchequer) of £120 billion, we propose the introduction of country-by-country reporting and a general anti-avoidance principle, in order to ensure that everyone living or doing business in the UK pays all the tax they owe.
We will extend the requirement on basic, affordable telephony to broadband to help ensure homes have sufficient access to the internet and to keep pace with the connected digital economy.
Enshrine net neutrality in law, protecting the fundamental principle of the free and open web.
Any data or research that is government funded will be required to be released under the Open Government License, ensuring that public funding equals public ownership. There will be an exception for government loans and innovation investment.
We will complete the metrification of the UK started in 1965, but never completed. The remaining uses of imperial units should be phased out and replaced with the modern metric equivalent, as recommended by the UK Metric Association.
Ensure worker-owned cooperatives and mutuals are given priority with all government contracts.
All private companies who receive public money must be subject to the same transparency requirements as governments when it comes to the goods and services they deliver5.
In order to stimulate adoption of the living wage, and act as a good example, all public sector organisations and National Infrastructure Organisations will be required to pay employees at least a living wage.
All public sector organizations will have to use open source software and services where available. Proprietary software that is currently in use should be examined for open source alternatives. A timeline should be created and made public to show how and when the body will convert to this alternative in a reasonable period of time. This is to cut down on public sector costs and increase our society's participation in the open source culture.
Close down all tax havens under British jurisdiction. This means reforming tax rules in the Channel Islands, the Isle of Man, the Cayman Islands, the British Virgin Islands, and others.
In parallel, work at an international level to get rid of tax havens outside British jurisdiction, and close international loopholes such as the "Double Irish Dutch Sandwich".
We will instruct HM Treasury to produce a roadmap for the future of currency and the role of central banks in a world with non-state-issued digital currencies, such as Bitcoin.
The central bank will be required to consider the reduction of inequality (as measured by the GINI coefficient) when formulating monetary policy to balance its existing remit of maintaining price stability and inflation at 2%.
Follow recommendations regarding transparency in the Lyons Housing Review - "To ensure greater transparency in the land market, the Land Registry should open up land ownership information to the public in a similar manner as the property price paid data set and make it a legal requirement to register land option agreements, transactions and prices."