Burn the rich?

Cast your minds back to Salem in 1692 when 20 people (mostly women) were persecuted because they were witches. Of course, we now know that witchcraft isn't a real thing, making the mob that called for their execution, murderers.

Today, the mob has turned its rabid hatred towards the rich. Blaming all their problems on people who are doing ok for themselves. The economy would be better if only corporations didn't avoid their taxes, welfare wouldn't need to be cut if people with mansions paid extra tax, people wouldn't need to use food banks if we taxed banker's bonuses. While all of this may hold a modicum of truth, do we really think that tightening the belts of the rich would benefit us?

Just like the witch trial in Salem, the execution of the "witches" didn't improve crops, didn't stop husbands from straying and didn't ward off pestilence. We won't see any of that money raised from taxation nor will public services improve.

Don't get me wrong, I'm the daughter of immigrants who grew up in a council house in West London. Although I am university educated, have a good job and own a property, I live hand-to-mouth every month. In my personal circumstances, I have no one to blame but myself. I love going to the pub, going to gigs and other cultural events, I especially love to travel and I love shopping for homeware, clothes, books and vinyl.

The reason I'm in debt is because the banks lent me money I couldn't pay back. And when the economy hit rock bottom in 2009, I was charged double for my mortgage while being unemployed for 6 months. The mortgage went into arrears and I was living off credit cards. OK, the latter part was the economy's fault. There were no jobs for a highly skilled, educated and experienced editor/marketeer.

The welfare system was a lifeline, but I wasn't frugal. I still went out and got hammered with my friends. Mainly because there's nothing more soul destroying then not having a job, being at home alone all day and living a completely listless life. I had dreams, I've been storyboarding novels since I was 17, it was the perfect opportunity to crack on and write my first book. However, when you're lacking in any motivation or confidence and being treated for severe depression, that's it. Game over.

Being poor gives people a sense of despair that you can't understand until it happens to you.

I'm sure being rich has its own pitfalls, you probably won't be able to trust anyone and I personally think money is stifling and isolating. However, I don't think over-taxing the rich is the answer we're all looking for, and my reasons are:

Tax revenue raised will go straight back into the system. They're not going to suddenly start handing out cash to disabled people, up housing benefit, increase our salaries, lower the cost of living, make classrooms smaller, cut hospital waiting lists, etc. These problems aren't fixed by throwing money at them and the government isn't going to start being generous, as their hands are tied by corporates, which brings me swiftly onto...

Vodafone employs over 8,000 people in the UK and has its global HQ in Berkshire, Google has 4 offices in the UK, compared to France that only has 1 and some countries don't have any. There's several Starbucks shops on every high street, transport hubs and workplaces. All these corporates employ thousands of people, they have offices which carry their own overheads that go into the community pot and the products they sell are bought by us and have VAT attached to it.

Also having the likes of Vodafone, Google and Amazon based in the UK, gives us economic kudos. It makes the UK a desirable country for companies to invest in. We'll also attract the most educated and highly-skilled people from abroad (ignoring that brain drain has detrimental effects on countries).

When I shop, I go for BOGOFs or discounts. I'm price conscious and want to pay as little as possible. I shop in Primark and Morrisons. The VAT I pay on a £4 pair of shoes isn't going fix the NHS. However, if I was rich and bought a Ferrari at 20% VAT, that's a lot of cash going into the pot. When I go out, I eat at Pizza Express and spend about £15 on a bottle of wine - a low-key night out costs around £50. If I was rich, I'd buy Champagne at £100 a bottle, eat in the finest restaurants that may charge me about £200 and get a taxi home. That's a lot of VAT cash. Even though I earn above average, rich people are indirectly paying far more into the system then I do in just one shopping spree. I mean, I will never buy a £2K handbag. And...

The fact that these shops are open add to the allure of the UK for super rich Russians, Arabs and Americans to come over and spend money. These shops employ people and pay overheads to stay open. In turn, it attracts other businesses to open in order to fill a niche, like a little coffee bar or taxi service. 

Also, just because someone may live in a house worth over £2 million, doesn't mean they're loaded. I know home-owners (myself included) that are living to or above their means. Just because your house is worth a lot, doesn't mean you have the disposal income to pay for a new tax. And think about the aristocracy, who live like peasants in their magnificent and decaying country piles. They would lose their ancestral homes. Those awful oligarchs will buy them up and turn them into Kim Kardashian's wet dream. I know the class system is unpopular, but I think the nouveau-riche and the bourgeois are abhorrent. We can't let them destroy the people whose families helped make this country the 6th richest country in the first place.

Just to be clear, I think corporates should stay out of politics and the media (I'll blog about this later), but there's no denying that even with tax avoidance, they do a lot for the economy. And while I think we need to encourage rich people to spend, I do think people like Jimmy Carr and Gary Barlow, who'd still be wealthy anyway, should not be tax dodging.

In the 70s, Labour taxed rich people so much that they paid 82p out of every Pound they earned to the government. That's on the verge of making them skint. No wonder Mick Jagger and Sean Connery moved. Now, they can spend, spend, spend knowing that their personal coffers will still be overflowing.

I agree with the fair distribution of wealth and helping people who need it the most, so why not incentivise rich people to "muck in". Don't send your cash to the Cayman Islands, pay for the up-keep of a women's refuge and we'll give you a tax break. Don't set up a company in Luxembourg, help fundraise for the NHS or buy an expensive bit of medical equipment and we'll give you a tax break.

It just seems more effective to give money directly where it'll make a difference than to pay into a system that will embezzle it by funding illegal wars, despotic regimes, schmoozing media/corporates and MP expenses.

First published on 15/04/2015