As Communities Secretary, Eric Pickles is responsible for council tax. He has ruled out an increase in council tax for houses valued at more than £1million. He went further, saying in an interview with Daily Telegraph that he also wants to see the end of the 50p tax rate for those on high incomes. He described top-rate taxpayers, and people with £1 million homes, as "middle class" and "hardworking homeowners" who put lots into society but "don't take a lot out". These three phrases combined can easily give a misleading impression about who would be affected by a "mansion tax". Indeed, they perpetuate an inaccurate understanding of wealth and class in British society.
Firstly, only about one per cent of houses are valued at over a million pounds. Similarly, only one per cent of the population are rich enough to pay top-rate tax. In no sense are these people in the "middle".
Secondly, Pickles regards this wealthy section of the population as a group of "hardworking homeowners". Many people are low or middle incomes are also hardworking. There is no general correlation between hard work and income within the population as a whole. The majority of people in the UK live and die in the same social class into which they were born. But certain politicians constantly associate wealth with hard work and poverty with laziness. Despite the lack of evidence behind this, it conveniently makes inequality appear fair.
Thirdly, Pickles claims that "middle class families have put a lot into the country and don't take a lot out". Again, he is using "middle class" to mean the tiny percentage rich enough to pay a mansion tax or top-rate income tax. To suggest that these very wealthy people give lots to society without taking much is demonstrably untrue. As Church Action on Poverty (CAP) point out, richer people pay a lower percentage of their income in tax than poorer people. VAT is the same rate for everyone from a homeless person to a billionaire. CAP's research suggests that the richest fifth of the population spend seven per cent of their income on VAT. For the poorest fifth, the figure is a whopping 14 per cent. There are some wealthy individuals who conscientiously pay their tax without looking for loopholes but a number of wealthy individuals deprive the Treasury of billions every year through tax avoidance. The very richest syphon off their money to tax havens, where it is of literally no use whatsoever to the British economy. The extent of tax avoidance undermines Pickles' claims about how much wealthy people, taken as a group, put into society.
More importantly, the very fact that the rich are rich means that they have taken more of society's wealth than the rest of us. We are encouraged to see wealth as a personal possession. If we instead see society's (and the world's) wealth as belonging to society (and the world) as a whole, it is clear that some people have taken vastly more than others.
The government tell us that the economic situation is so dire that they have no choice but to increase VAT, abolish Disability Living Allowance, make massive job cuts, scrap Education Maintenance Allowance, treble university tuition fees, attack public sector pensions, cut funding for local services and basically tear the heart out of the welfare state. But it seems that the situation is not bad enough for government minsters to introduce a mansion tax, slightly raise the top rate of income tax or bring in VAT on private education and private healthcare.
Their treatment of the wealthy contrasts sharply with the demands made of the rest of us. New Labour governments also seemed wedded to the interests of the rich. This situation makes one thing clear. The coalition's economic policies are not primarily about addressing the deficit. They are the weapons in a vicious assault against the working class. In short, the government are fighting a class war.
Adapted from an article by Symon Hill, associate director of Ekklesia, a religious think-tank
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