A think tank has said the government should tax firms that have made “excessive pandemic profits” to help “rebalance” economic power and improve workers’ wages and conditions.
The Institute for Public Policy Research (IPPR) argues that the COVID pandemic should see an end to widening inequality and mark “the beginning of a new era” where opportunity is shared among all people across the UK.
The organization said in its report that this year’s one-time unexpected tax money would generate £47bn to be spent to tackle inequality and secure full employment after the pandemic.
This comes a day after a new report from Tax Justice UK showed Asos and Serco were among six companies in finance, outsourcing, retail, real estate, mining and pharmaceuticals that have made ££ in additional profits during the pandemic. 16bn was earned.
The profits of one company, Scottish Mortgage Investment Trust, were up 801 percent over previous years – according to the report ‘Pandemic profits: who is cashing in during COVID’.
The executive director of Tax Justice UK, Robert Palmer, has also asked Mr Sunak to consider an unexpected tax on excess profits made during the pandemic, as well as raising the corporation tax to 25 per cent, in his upcoming budget on 27 October. expected to be announced. .
Now, the IPPR has made its own call to “promote it like Biden” with an economic stimulus designed to achieve full employment for Mr Sunak, which states that “employers will compete for workers”. , rather than workers competing for workers”.
The think tank said £30bn should be spent on green projects and £17bn on social infrastructure, such as health and care.
In March, US President Joe Biden signed into law a £1.4 trillion economic relief bill aimed at helping Americans affected by the pandemic in the form of one-time direct welfare payments to most families.
Ahead of major political parties’ conferences in the coming weeks, the IPPR argues that a similar measure to direct unexpected tax revenues into “citizens’ wealth funds” would “rebalance power” and “spread prosperity” through “strategic” investments. “will help.
It says the return on investment could reduce wealth inequality by giving a “universal inheritance” of £10,000 to every 25-year-old born in the UK from 2030.
Outlining the reasons for its proposals, the IPPR cited figures showing that two-fifths of workers have had real pay cuts since 2009, and 5.5 million workers are in unsafe work – 960,000 of whom are in zero-hours. are on contract.
Meanwhile, the wealthiest people in society have become even richer through the rise in the values of their assets and financial investments, especially during the pandemic.
Between June 2020 and June 2021, the average home price increased by £31,000, which is equivalent to the average UK salary.
The IPPR said market strength and profits are proportionately concentrated within the top 1 per cent of companies, squeezing out many smaller competitors that have been forced to close or survive on government funding and loans during successive lockdowns.
The think tank said that a quarter of the remaining small firms reported that the cost of repayment of debt had increased by at least 20 per cent.
Carys Roberts, executive director of the IPPR, said: “The UK suffers from the concentration and imbalance of power that is the cause of some of our economy’s problems, and is an obstacle to solving them.
“The pandemic should mark the end of this era of growing inequality and the beginning of a new one, in which the sharing of opportunities across people and places is the main objective of economic and social policy.
“As well as measures to support and grow the economy, such as a significant economic stimulus and long-term investments, shifting power should now be a priority. By talking about people’s concerns and their disempowerment, these power transitions have the potential to build towards a better economy that works for all. We call it economic justice.”
George Dibb, head of the IPPR Center for Economic Justice, said: “Most people don’t want to see the economy go back to how it was working before the pandemic. Change is needed, and our plan to push the economy hard for justice will ensure that the benefits of recovery are shared with all. “
Credit: www.independent.co.uk /