An Alternative Budget

Don’t expect big wins for the working class in today’s budget, otherwise known as Dishy Rishi: The Sequel. Sunak will spend spend spend, and he may even bring in some relatively progressive taxation changes, but none of this will be enforced thoroughly enough (allowing multinationals to continue to evade paying their fair share), any safety net expansion will be reluctant, and any big spending will be directly or indirectly used to funnel more state funds to the 1%.

In other words, what may look like a People’s Budget will once again be a Ruling Class Budget. Meanwhile, the Labour party will push the wealthy Chancellor to be even less progressive, all while rejecting basic ideas like a wealth tax or taxes on windfall taxes on big business that at this point Joe Biden seems more susceptible to.

So there is absolutely a vacuum, since the budget won’t be for working people, and the opposition is trying to outflank the Tories in terms of courting the favour of the ruling class. This is actually the first full throated budget by the govt we’ve had in 6 years where we didn’t have John McDonnell and his team offering us a real alternative to corporate hegemony.

In the Commons today, in the same place where Jeremy Corbyn got up this time last year and eviscerated Rishi Sunak for the Tory record in office and those they’ve hurt. Keir Starmer and his new spectacles will get up, and suck the establishment’s dick thoroughly. Graphic, I know, but I couldn’t think of any better way of expressing just how desperate to court the favour of wealthy interests Keir Starmer and his team of sell-outs really are. Allow me therefore, to take you through my vision for an Alternative Budget, and what a People’s Chancellor would be doing as they set out Britain’s economic policy for the following year.

On taxation, there should be no rush whatsoever to hit middle and lower income citizens with massive tax hikes. We will release a massive funding package to local government in order to help them balance their books without harming the most vulnerable yet further, and reversing the last 10 years of local govt austerity. No amount is too much here, we’ll coordinate with local government and authorities to provide them everything they need to

  1. Stop any rise in council tax and provide additional council tax relief to those earning under 30k a year.
  2. Reverse austerity-forced cuts on locally run public services from the last five years.
  3. A new annual funding set-up, providing local authorities what they need and getting the money out the door in emergencies like this to avoid any more local austerity.

Following this we need to take a look at income tax. There is a huge amount of wealth accrued and stored during this pandemic at the top of the income scale, and much of it won’t be spent in the way working people spend their money; we’ll raise income tax rates on the top 5% of earners to 50% towards the end of this year, and 55% on the top 2% by the end of this parliament. This is how we get this money out into the economy, putting the new funds into a Community Wealth Fund, and distributing it help rebuild services and high streets in the most deprived communities with the most cash strapped local authorities, giving pride back to those towns and city regions most in need, letting local people democratically choose through Citizen’s Assemblies how they want to spend these funds.

Corporation tax will go up to 23% at the end of this year, with a new Taxation Enforcement Agency that will prosecute any businesses that purposefully avoid paying tax while doing business in this country, and will look for an eliminate loopholes. Corporation tax will go up further to 28% by the end of the parliament, still putting us below Germany’s 30%, since this only hits profits, not businesses struggling. We will provide urgent and long term business rate relief to SMEs, while hiking it on multinationals doing business in this country.

We will introduce a Financial Transactions Tax of 20% on the City Of London (the wealthiest during this crisis must pay their fair share in rebuilding Britain), as well as a Wealth Tax, an Asset Tax of 35% on properties over 22 million, and a Windfall Profits Tax on those who’ve made a killing during this pandemic.

We will distribute an immediate £100bn People’s Stimulus Package, to kickstart the UK economy as we emerge from lockdown, with furlough improved changed, and extended for those who need it for up to 2 years on a phased approach, as less and less of people’s wages are subsided as they can work more and more, much like approaches taken in Europe. We will initiate nation-wide rent caps, tipping the balance of power in favour of renters as opposed to landlords, while providing urgent rent relief and forgiveness to SMEs and Cooperative business, and providing a £800m start up grant scheme to locally run ethical businesses, with business rate relief for the first 5 years of their business. We will repeal Thatcher’s anti-union laws, and raise the minimum wage to a living wage of £20 an hour, with relief and subsidies to smaller enterprises that can’t afford it.

We’ll phase in a Full Employment policy, providing the offer of work or training on infrastructure projects to anyone who wants to be employed in the public sector (further tipping the balance of power away from capital and towards labour), and we’ll scrap Universal Credit and our current benefits system over the course of the parliament, replacing it with a Universal Basic Income for each citizen not working or in low pay work of £300 a week. Consultations will be formed on what industries and services should be taken into public ownership, and all struggling businesses will get the help they need as we emerge from this pandemic.

This is just the tip of the iceberg of what smart policymaking for the 21st Century would look like.

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Toby Lipatti-Mesme

Toby Lipatti-Mesme

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Insightful and innovative UK journalism and commentary, from Toby Lipatti-Mesme.