Isabel Oakeshott
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A supertax on high earners should be considered as part of Gordon Brown’s autumn fight-back, a minister says today.
Ivan Lewis, writing in The Sunday Times, calls on the government to introduce a new economic package to bail out the hard-pressed middle classes – possibly paid for by new taxes on the rich.
The health minister warns that urgent steps must be taken to protect the living standards of the “mainstream majority” of comfortably off voters who swept Labour to power in 1997.
His intervention ends the brief summer truce in Labour’s civil war following the government’s disastrous defeat in the Glasgow East by-election and is likely to be the first of a series of provocative moves by MPs disillusioned by the party’s flagging fortunes.
A YouGov poll for The Sunday Times today shows David Cameron’s Tories have a 20-point lead over Labour, which is stuck on 25% support.
Several ministers are known privately to share Lewis’s view and are expected to speak out in coming weeks – piling pressure on Alistair Darling, the chancellor, to do more to help struggling middle-earners.
Lewis points to families who take two holidays a year, belong to private gyms and eat in restaurants, but struggle to pay soaring bills, as the group in need of help.
“If, as a result of the current economic situation, the only way to help hard-pressed middle-class families is to ask the highest earners to pay more, then serious consideration should be given to that,” he writes.
Last month a former minister, Chris Leslie, called for an extra 10p in the pound tax for earnings above £250,000, the threshold Lewis is believed to favour. The Treasury estimates this would yield £3.5 billion a year, about the same amount as it collects from inheritance tax.
Lewis warns in his article that the electorate is “angry and disappointed” and says Labour has a “duty” to make tax and spending decisions which demonstrate the party understands the pressure of rising food, fuel and utility bills.
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This is absolutely ridiculous!!! The country is crying out for business minded people and entrepreneurs to bring us out of economic recession and the labour government just wants to tax them for their hard work, the sooner we are under Tory rule the better!!! David Cameron has the right ideas!!!!!
Benjamin, Lincoln, Lincolnshire
Excellent, another Intelligence Tax. This may seem like a good idea at first but it's ideas like these that have resulted in this country already suffering badly from Brain Drain. If we continue punishing the successful, they will soon move abroad and we will lose all the tax they already give.
Andrew, Leigh, UK
Strange isn't it. Ivan Lewis proposes that this tax bracket starts at £250000. Exactly the sum that most MP's pay and perks fall just short of. Not prepared to pay the extra tax yourself, are we Mr Lewis? Can't set the limit any lower or it would not get voted in, would it Mr Lewis?
Graham, Bradford, England
All lawyers, bankers, chartered accountants! The Cayman Islands, and the Bahamas wellcome you. Get on board!
Better still, the French islands of Martinique and Guadeloupe give you France in the Caribbean.. even the rain is warm here... we can take a boat to the Grenadines
Norman, Fort De France, Martinique
I'm pleased to see that at lease one Labour MP is dimly aware of how much they're hated amongst middle class voters right now. Perhaps if we all collectively start chanting "STOP EXCESSIVE SPENDING!" the message might just begin to filter through the selectively deaf ears of the party.
Paul, London,
There is a much simpler solution to this..increase the personal allowance to around 12,000 GBP a year.
You'll encourage and help low earners, tax revenues will actually go up (via VAT and indirect taxes) people will stop evading tax..(and tax credits will go, massively saving on beaurecracy
Peter Gibbinson, Keston, UK
The answer to Labour's problems is always TAX
Tony, Durham, uk
As the comments show, you cannot fool all of the people all of the time, and UK voter no longer believes or trusts this Labour govt.. We must, absolutely, protect those who need it, but allow hard work, entrepreneurial behaviour and skills to succeed and be rewarded. And do this with minimal Govt.
Alec, London, UK
They were found out taxing the poorest paid people more with the 10 p debacle, so they have to find someone else. They only know how to tax and how to waste our money whilst pocketing as much as they can for themselves.
Russ, Aberdeen, Scotland
Taxing top earners any more may well remove their incentive for working. I agree with Philip, Ipswich: this is just a cheap trick to take the heat off the government. Talk about trimming the leaves and clutching at straws...
Abdul Majeed, Bradford, West Yorkshire, UK
I can get the budget right every time without borrowing. It's called Revenue percentage spending.
Whatever we receive in tax this year, next year we can spend:
5% on Defence
5% on Social security
5% on NHS
0% on stupid ideas
etc. etc. etc
leftovers divided between tax cuts debt repayment.
Phil, Warrington, England
It really is time to leave this country.
Brendon Moran, London, UK
I think i'll take my professional qualifications, degree, experience and my chartered accountant girlfriend and live somewhere else.
Why are the young single professionals paying for everything? We get nothing back. EVERYONE, PAY FOR WHAT YOU USE!
Adam, Guildford, England sadly
How about:
No benefit for anyone not working after 3 months unemployed
No pay or allowances for MPs
Scrap "non-jobs" in local councils - equality managers, gender advisors
End the madness in Afghanistan and Iraq by bringing all troops home now
100% VAT on "cheap" unhealthy foods
David Mann, Chester, UK
The only reason "hard-pressed middle-class families" are in this state in the first place is because Labour taxed them and wasted their money. His solution? Tax the rich. Genius.
Bill, Malaga,
I agree with many of the other comments. Taxes are often squandered on red tape and public sector jobs to handle the details. Labour can't tax their way out of this. Why not reduce the complicated tax system. The money saved would be immense. Less government and more prosperity for those who work!
Phil, Welwyn, UK
The Treasury say they could raise £3.5 Billion.....hmmm!
Keeping our forces in Iraq and Afghanistan currently costs us £3.5 Billion each year......hmmm!
Methinks that's a no-brainer. Methinks it's time for a general election.
Paul, East Sheen, UK
Don't tax the poor at all, introduce flat taxes and dismantle the Inland Revenue.
Jeremy, London, UK
Amazing!
When there isn't a single example of a country anywhere, which implemented increased taxes on the rich, resulting in economic growth, we're yet again presented with this awful, popularist nonsense.
Cut government spending and allow human energy to create wealth - you know this makes sense
John Merrell, London,
Poor people are poor because they are stupid. Rich people are usually brighter. Research shows, time after time, that there is a strong positive correlation between wealth and brains. It is evolutionary. So, who should the British government tax to boost the economy? Smart people or dumb people?
Nick, London, UK
Sod the middle classes, what about the low paid who are still paying increased taxes after the removal of the 10p tax band last year?
judy, Liverpool, England
so they take 2 holidays a year and have private gym memberships but cant afford to pay their bills? surely that is a damning indictment of labours tax and ecconomic policy in general?
but no in a time of reccession they decide to punish the people who create employment.
brain drain anyone?
will, grimsby, uk
interesting idea (obviously we'll hear the squeals of "we'll move abroad if you tax us" by most of the same carefree blood suckers who got the economy into its present state) but this just smacks of a past it and desperate government that just needs to do us all a favour and get out of office.
paul m roberts, Newport, Wales
So he would take 25k from someone to give £300 to an average taxpayer, what a waste of time and effort, and its not to help anyone other than save labour
MP's skins. Fact is they should not have bankrupted the nation by taxing and spending, as all labour governments do.. Get them out now!
Steven KB Katirai, Newcastle Upon Tyne,
If this crummy government were any good, they could cut taxation. Tax, tax and more tax. That's all this NuLabour bunch know. It's like a sickeness, or a religion. Isn't it easy to 'manage' by just throwing money in, instead of giving it some thought. These people just cannot manage.
Np, England, UK
Alternatively he could tax the poor. There are a lot of them and it will encourage them to work harder to be rich.
Merlin, Northampton,
Tax those fottballers I say! They can't just re-locate and if the foreign guys leave it gives our local players a chance.
Ian Burgess, Bristol,
If I remember correctly, supertax went out in the 1970s, yet another example of Labour showing how they are yesterday's party.
Michael Cawood, Wrexham, Wales, UK
I am not a Labour voter, but let's be fair. Labour cut income tax to 20%. All in all I probably pay a smaller percentage of my income in taxes than 10 years ago, including 'stealth taxes'.
The high earners responsible for the credit crunch, destruction of British industry, are not wealth creators!
Anthony, Devon,
Excellent! Exactly what we need to get more bankers/lawyers/high earners out to Hong Kong. 15% tax here, beautiful countries nearby, thrilling nightlife, great ex-pat community, cheap flights wherever you want. And no speed cameras! Bring us your over-taxed and frustrated! We're waiting for you.
Andrew Mansell, Hong Kong, PRC
I assume when Mr Lewis says the rich should face increased taxation that he and his fellow politicians will be included in the "wealthy" bracket? Or, as usual, will it be everyone else but politicians?
Matt, North East, UK
Somebody has to pay for tax gaffs like this:
"Merrill Lynch could avoid paying tax in the UK for decades after booking £13bn of losses on its toxic investments through its London subsidiary."
Fred, Moray, Scotland
I am outraged that Ivan Lewis actually believes that the middle-class people who spend their money on excess luxuries are the ones who need help to pay their bills! Has it occured to him that maybe those people can help THEMSELVES by not going on holiday, by attending a public gym, etc?
Gemma, London,
The rich always threaten to 'pack up and leave' when measures like this are touted.Like they don't already avoid paying the current rates!Mind you I don't blame them,all tax rev is squandered by NuLab.
If it's so easy to relocate and cream another society elsewhere just go.try china or russia.
japers, Bolton,
If you did theis, then how many new tax exiles would you be creating?
Tom, Kansas City, US
I had thought that by the rich needing to be taxed more heavily Ivan Lewis might have been referring to people who take two holidays a year, belong to private gyms, and eat in restaurants, but it seems that these are the people he has defined as needing help. Different perspectives, I suppose.
Peter, Cambridge,
Tell you what - only collect the rubbish every two weeks and have the household do all the separating and recycling for you we'd save a fortune. Oh, done that already.
How about some more speed cameras then?
..Or put up the road tax with some trumped up idea it's a greener way? Oh done that too.
David, St Albans, UK
raise tax, raise tax, raise tax - NuLab mantra
Mike, Sole Street, England
Remember, this government is a bag of weasels. This is the thin end of yet another Labour wedge. Tax the obvious easy target, but watch out because there will be another stealth tax screwing the rest of us. The wealth tax is only a rouse. It's too obvious. The middle class will be targeted again.
Scotty, Richmond-Upon-Thames, UK
Are there really British politicians in the 21st century who still think this way because they are so out of touch with the real world and real people? It's frightening. Reminds me of the old Labour and trade union dinosaurs of the 50s and 60s who began Britain's fall into mediocrity.
E.Cowham, Melbourne, Australia
Would this be accompanied by a reduction in tax for the middle earners? otherwise, how are the middle earners being benefited?
Charan Muzaya, London, UK
Oh well - it's back to Old Labour - huge taxes on the rich, well the only effect of that will be that these people will simply leave Britain and Labour will be no better and probably worse off.
Michael Cawood, Wrexham, Wales, UK
An extra 10 p in the pound on earnings over 250K hardly counts as "extremist socialism". Under Labour the incomes of the rich have soared while average salaries have remained largely unchanged. It's time the super rich put something back. Their wives could spend less time in Harrods to compensate.
Simon , London, UK
Two weeks ago the same minister told us that there was no proven link between thousands of rat and cockroach infestations in hospitals and any diseases passed on to patients. This new statement has about as much credibility as the last one.
Chris Jones, Belfast, UK
I imagine this is more spin from New Labour. Anybody who earns £250k per year will know all the tax dodges to avoid paying extra tax. Still the ideas right. At the moment, money is being re-distributed from hard working singletons earning between £20000 to £150000 to the super rich and poor.
John Lilburne, London, UK
Asking higher earners to subsidise the holidays and overpriced mortgages of the middle-class is as distateful as asking people in their 40s and 50s to be subsidising perfectly healthy people in their 20s. How about cutting one's cloth?
S.C. Huldig, Leiden, NL
How about an extra tax on MP's who vote themselves large pay increases whilst bleating that the rest of us should stick to 0 increase ?.
Kia , london, uk
Could they commit political suicide faster if they tried?
Have they forgotten the 1970's when the tax rates were so high, the super-earners (rock stars etc.) all moved abroad & the tax take went down (it went up in the 1980's when tax rates were lowered).
What a clown.
General election now!
colin, london,
Some say that the 'rich' will leave if taxed more.
Let's try nevertheless and see what happens!
Robert, London,
Typical isn't it, just think of another way to get more tax. I bet they have thousands of minions locked away in rooms trying to think of ways to increase taxes. (E.g Green)
Lets have a cost reduction programme instead - ah! but that would be admitting defeat and error - so no chance there then
Alan, Houghton-Le-Spring,
In all good households when expenditure exceeds the budget you cut back.If after over a decade at the treasury gormless does not understand this basic rule he must have been the most incompetent chancellor ever.Skinning the rich to prop up a dead duck administration smells of desperation.
Philip, Ipswich,
Extremist socialism such as this is the way to economic ruin, not economic recovery.
James E. Petts, Burnham, England
The best way to protect the living standards of the mainstream majority is to rid the country of this New Labour goverment. It is becoming clear that Gordonomics is a one-way bet on a booming property market. Mr Brown has bet and lost!
Costas, Cyprus,
Typical Labour solution to any problem, tax it. Sounds like they are now trying to bribe the middle classes
Chris, Woodbridge, England
So just like in the 70's the wealth creators were driven overseas taking their money and jobs with them. New Labour same old stupidity.
Perhaps if Labour MPs showed how they were prepared to have all their "perks" taxed at a higher rate I'd be prepared to even listen to their argument.
roy race, bratislava,
Tax the fat cats
Fred, Moray, Scotland
"Lewis points to families who take two holidays a year, belong to private gyms and eat in restaurants, but struggle to pay soaring bills, as the group in need of help."
I seem to have woken up in the wrong world. I'm going back to bed. Labour help the middle classes who they've taxed to death??
Steve, Coleshill, UK
I take two holidays a year, belong to a private gym and eat in restaurants. This is why I struggle to pay soaring bills. But I don't Labour's 'help'. I need to take fewer holdays, jog instead of paying for my private gym, and cook meals instead of dining out. Is there a Minister for Common Sense?
Dominic Strada, London,
"Lewis points to families who take two holidays a year, belong to private gyms and eat in restaurants, but struggle to pay soaring bills, as the group in need of help"
... I am speechless. why should taxpayers bale out these families? Cut on the holidays and eat at home!
Rich, Chelsea,
Mr Lewis, here is the solution to your problem;
Income Tax revenue - £130 Billion.
Welfare Budget - £139 Billion.
Not difficult is it.
Steve, Coleshill, UK
Back to the 1970s then. Is this his "vision" that we were promised?
Mitch, Wolverhampton, England
I have no problem with the supertax, but I do have a problem with the way this government mismanages money. There is noi point taxing the rich if it is simply going down the pan.
Farrukh, Woking,
So let me see if Ive got this right. We are in the middle of the mother of all recessions and the Governements only response is to raise taxes!
Make the most of your time in power labour. With thinking like this you have consigned yourself to the history books and the opposition benches.
Scott, London,
This joker is my MP.
An unpopular egomaniac to say the least.
Ivan Lewis has hit national headlines in recent months in a relentless effort to kick Brown when he's down because he is only too aware of his constituency's electoral marginality. Like his North counterpart, he's finished.
Ronald McDonald, Radcliffe, United Kingdom
Labour has sold the country and the national debt burden is at the highest it has ever been. If they single out the super rich they will move both work and finanaces offshore. Much like what happened when IR35 was introduced, the highly skilled left the country along with there tax contributions.
Chris, Leeds, UK
Harold Wilson's lot tried this in the 60s, top rate was even over 100% for some.
Didn't work then (other than cheering up the pathetic class warriors), won't work now.
Stan(expat for now), USA, Usa
These guys just dont get it, the electorate is quite intelligent, they understand the negative impact of punitive tax policies on theri own income, they also understand Brown has no real mandate as PM. Its time for an election, its time for Brown to resign.
james, Southampton, England
Gordon is wedded to a 'dumbell' economy where the rewards go to the super-rich who finance the party and the super-indolent who can be relied on to vote Labour. It's too late to change this; it's part of his DNA.
Peter, Oxford, England
I agree with Heeners but also suggest that National Insurance taxes should be abolished and rolled into income taxes. Can anyone come up with a good reason why in the current environment these taxes should be separate - it's not as if they fund separate "ring fenced" activities.
Ian M Jones, Reading, UK
Heeners - that is plain stupid, as is the current system. Why tax people, so that they then have to claim the tax back in the form of benefits (aka "credits"). All this does is emply people to get the sums wrong, as we know from the shambles that is tax credits. No the start point must be raised
Jeremy Poynton, Frome, England
The only reason the 'Middle Classes' are paying so much tax is Labour's failure to spend the tax it already takes wisely.
Tom Wright, Reigate,
We should start by implementing the proposed super tax on the undeserving rich. By this I mean members of parliament with their huge unregulated expense accounts, massive pension pots and housing & never ending holidays all courtesy of our tax money.
Peter Hastings, Folkestone, England
Aren't these people stupid - cannot they remember what happened last time - the really rich and their spending power leave the country and go somewhere else along with the existing taxes they pay - companies are already doing it. Our latest "hero" - Lewis Hamilton has already gone....
Richard, Newton Abbot,
This is the old politics of envy rearing its ugly face.
Maybe they should consider why it is some 5 million Britains have already chosen to make their home abroad.
Then they should ask how many of those left during the current Labour government.
Tax the rich and the rich will leave.
James, Marbella, Spain
When will Labour learn that penalising the sucessful and social engineering is not a feesable way forward.
Chantel , Wales,
Aboslutely amazing, tax the wealthy because they've taxed the middle to death. Why aren't the conservatives if thats really what they are, campaigning for tax cuts, I wish I could run for office I'd cut taxes, end most social programs , and tell the bottom feeding tax dodgers to get jobs or starve.
Mike, Washington, DC, USA
Cutting the billions spent on false and unnecessary Social Security claims would be more productive. The very rich will simply move their money somewhere safer.
Jack, Barnsley, UK
First, labour wrongly think there's a fixed amount of wealth they have to redistribute, rather than helping everyone to generate new wealth. Second, the rich are those most able to avoid such tax. Third, the government has an appaling record at spending our money in the first place.
T Coates, Ambleside, Cumbria
.... as to this bit:
"Lewis points to families who take two holidays a year, belong to private gyms and eat in restaurants, but struggle to pay soaring bills, as the group in need of help. "
Well, I've not had a holiday in he last decade, never mind the last year ...
Alasdair Martin, Leadhills, Scotland
absolute nonsense to tax the well off. It will erode the incentive for people to work harder . Britain will settle back into a life a mediocrity. And the real talent will live elsewhere instead .
Gerry, retired in the sun , Bangkok, Thailand
tax the rich? No.
How about dropping expensive and pointless projects like trident ...
Alasdair Martin, Leadhills, Scotland
That should really please the Labour Party's wealthy donors.
David Meyer, London, UK
Strange use of the word "ask". Is it supposed to disguise the exercise of foolish tyranny? "Ask" is a pretty unconvincing euphemism for "compel on pain of prison" .
MikeMSN, Midsomer Norton, UK
I agree. Abolish 0% threhold, everybody should contribute.
0-12,000£ 10%
12-34,000 20%
34-50,000 30%
50-150,000 40%
150 + 50%.
This would encourage people to work. IHT should be abolished for anyone who leaves money to their own spouse or child.
Heeners, Bath,
The longer they put off the inevitable (calling an election) the more devastating will be their defeat and the longer they will have to wait before the electorate ever trusts them again. Sadly they don't seem to get it.
John, York,
History has shown that it is not a good idea to tax the rich -- they simply go elsewhere so the tax becomes counter productive, even lowering revenues after the first year or so of introducing the higher tax. But then to see where Labour is heading, just look back to the 1970s.
Hall, Sheffield,
Tax success and subsidise failure. A recipe for stagnation and disaster. Will populist politicians never learn? Or do they know this, but are willing to trade short-term popularity for longer-term problems (which anyway someone else will have to deal with?)
Peter Cressall, La Lucila, Argentina
I really don't know why we bother having a government. All we need is a computer which, when any keyboard key is pressed, prints out 'Raise taxes'.
Why is the only Labour solution to any problem to increase tax?
Perhaps they should devote more time to spending the £600+ billion revenue wisely.
Bernard, Edinburgh, Scotland
Incredible.....Brown has taxed the middle class out of existance over the last 10 years, so what do Labour propose to make amends? A super tax that will drive the rich out of Britain just like it did 25 years ago.
The idiocy of this government is just neverending.
Andy C, New York, US
Taxing the rich is the only option left.
The middle class have no money, only debt after 10 years of Gordonomics.
UK is now a Feudal society of 1% super-rich and 99% debt serfs.
Pat, Corramandel, New Zealand
Labour always thinks it can spend its way out of trouble. It won't work. We can't afford to pay any more tax so we have to cut govt spending. Its called "living within our means". If people can afford 2 holidays per year they can afford to pay their gas bills. Its called responsibility Mr Lewis
Rupert, London, UK
Taxing the rich is the only option left.
The middle class have no money, only debt after 10 years of Gordonomics.
UK is now a Feudal society of 1% super-rich and 99% debt serfs.
Pat, Coramandel, New Zealand
The summer holidays have obviously erased the Non Dom Disaster from Labour MP's memories which was also created by their desire to tax the rich. The rich won't pay this tax because they will pay advisors to avoid paying it legally. To penalise the rich who create money for UK plc seems mad.
Rupert, London, UK
This is too little, and very late in the day. The fat cats have had their skimming the national cream for too long. Finally a minister has woken up to middle Britain.
It is also high time to levy windfall taxes on the monopolistic utility companies who are enriching themselves at our expense.
David, Liverpool, England
Including Ministers of course.......!!!!
ian payne, walsall,
What the public want is less Government spending and waste, not more taxes. They still don't get it do they?
Lawrence, London, UK
Denis Healy said " tax the rich until the pips squeaked" So this suggestion from Nu Labour is not very original is it? In fact it is steeped in labour dogma. If there is a problem, increase taxes, not think about the waste, the useless computer syatems, NHS PFIs, corruption etc. Just increase taxes!
Ralph, Swindon, England
Instead of trying to make up for this government shortcomings (education, transport&infrastructure), attacking the really problem of government wastefulness and incompetence would surely give you a greater boost in the polls. Why make an example of those who make a success of their lives, how about saving money reducing welfare dependences or work for the doll scheme.
Edward, Geelong, Australia
Mrs Thatcher discovered that when she lowered the top tax rate to 40% the tax take went UP! How quickly this bunch of economic illiterates forgets hard-earned lessons.
Will the last one to leave these shores please turn out the lights.
Pedro, Stratford,
and drive away high earners from britain that can lead british business to the international standards it used to maintain? another thoughtless rumbling of disillusioned labour ministers that don't know where to stand and don't understand the choice either.
Chris Smith, Surrey,
Yes especially these overpaid footballers and excecutives who take a huge bonus for doing little. I would like to see a rationing system similar to wartime Britain, then everyone could be basically supported. Bring back National Service, you are going to need it. Contingency thinking is essential.
Michael Wilson, bidache, france
"Ask" higher earners to pay more of their hard earned in tax. That's rich. And where would the money really go anyway? Certainly not on tax cuts for us run of the mill suckers. It would be swallowed-up by the bottomless, vast borrowing demands of this bankrupt, profligate, inept regime. Pathetic.
Jono, Carmarthen, Wales