There are rumours afloat that one of Boris’s aides was behind the letter in the Financial Times last week which was signed by a group of Economists calling for the 50p rate of tax to be axed in the UK. The letter has successfully reignited the “50p” tax debate and has continued to rage in its letter pages. It was also picked up by the Sunday papers last weekend. Boris even managed to weave it into his Daily Telegraph column this morning when writing about the proposed Thames super sewer, gleaming that the 50p tax debate “seem to be moving in the right direction”.
For me, the letter would have had a lot more gravitas if any of the signatories to the letter had been economists who’d predicted the financial crisis. However, like the vast majority of the profession, most had little to say when it came to foreseeing the evolving financial crisis. How then, or more to the point, why then, should we invest any faith in their prediction about the effect of marginal taxation on the rich? Moreover, it would be interesting to know how many of the signatories are themselves paying that rate?
Contrast, Warren Buffet in the USA and the rich in France signing up for more taxes on the grounds of national interest and equality. It seems that the UK’s calls for a scrapping of the top rate of tax is not indicative of a wider universal revolt by the super rich against higher tax. (The Boris camp must be asking where the self-publicity seeking Richard Branson is when you need him?)
Take also one part of the economy which has seemingly not even blinked an eye during the financial crisis – premiership football. There are still a plethora of top international players keen to ply their trade in England. One does not hear many of them complaining about the top rate of taxation when they arrive at their new club. In fact it would a story in itself if we heard about any top player leaving because of the 50p tax! Player’s decision to leave are often football related, on the hunt for more trophies, prestigious clubs or sometimes personal family reasons. A 50p tax regime has never even been mentioned.
So, I think the Mayor should start speaking up for all Londoners, most of whom would delight in being in the privileged position of pay a 50p rate of tax and stop flying the flag for his banker chums. He would also do well to take note of the rest of the world’s super rich on this issue, not forgetting the foreign footballers clambering at our door.