WHAT IS BREXIT FOR?

Discussion around Brexit and the Withdrawal Agreement has concerned the Irish border and the Backstop, the loss of tariff-free access to the EU and the implications for the movement of people across borders. Remainers occasionally express concern about a potential loss of employment rights but this has little substance other than to attract naïve social democrats to the Remain cause as the EU has done nothing to resist the increasing casualisation of labour, the erosion of collective bargaining rights or anti-trade union legislation. The Big Issue that no one is debating is what sort of country will Britain be post-Brexit.

Neo-liberals tend to keep quiet about their ambitions for a post-Brexit Britain. Their dream is for a Singapore style economy twenty miles off the coast of France. This means an economy that is exploitative, de-regulated, minimally taxed, gutted of its social services and open to capital from across the world with no questions asked. Close ties with a USA are called for if only to ensure that we can continue to rent Trident and its up-grades.

Communists have a different ambition. If we are quiet about it, it is simply because the mass media does a good job ensuring that our views are not reported. We want a socialist Britain run for the benefit of those who live within its shores, not the owners of footloose international capital. To get there we will need a progressive tax system incorporating many of the ideas in our pamphlet From Each According to Their Means  (1). But as we point out in this pamphlet, many of these ideas – a land value tax; varying rates of VAT with rebates for workers to address social needs; unitary taxation of corporate profits to nullify the use of tax havens; and a tax and dividend carbon tax as advocated by  James Hansen to address global warming – would be impossible under continued membership of the EU or the Single Market.

So in the end the complexities melt away and the choice is a straightforward one: accept the block on progressive reforms that are a pre-requisite of social revolution or seize the opportunity to begin building socialism – provided, as Marx recommended in the Communist Manifesto, that we first “settle matters with our own bourgeoisie”. 

 

  1. Available from the Communist Party Shop at http://www.communist-party.org.uk/shop/pamphlets/2025-from-each-according-to-their-means.html

 

 

 

Tax Reform

Chris Guiton

With the budget looming, bourgeois commentators are getting excited about the apparent spat developing between the Tories and the LibDems over the prospect of a mansion tax or a ‘tycoon’ tax, and a trade-off between the introduction of one of these options and the removal of the 50% tax rate on income above £150,000. Both mansion and tycoon tax proposals are fundamentally flawed and limited in scope, and the suggestion that tax be reduced for the wealthiest is an insult. And all this while the banks continue to pay out unfeasibly large bonuses, Barclays being only the latest, benefits are slashed and real wages continue to fall.

It’s abundantly clear that the Government will do their utmost to avoid upsetting their friends in the City. Treasury steps to close one or two limited tax loopholes will have been choreographed with the banks and are, anyway, no substitute for robust action on a broad front, such as a general tax anti-avoidance rule. In the meantime, wealthy individuals and big business will continue to pay tax on a largely voluntary basis, while people on PAYE have no option but to pay tax, VAT is inescapable and low-hanging fruit such as small businesses will continue to be targeted by HMRC .

With the Labour leadership clearly signed up to the neo-liberal agenda, social democracy in Britain is a busted flush. But it would be interesting to see whether a broad coalition of forces on the left could be developed in support of the establishment of a ‘Fair Tax Commission’ to examine the legitimacy of a more progressive tax system which shifts the focus to taxation of wealth, land and the grossly over-inflated incomes which have become the hallmark of 21st-century capitalism. And which considers serious steps to tackle the tax avoidance and evasion which is estimated to cost the exchequer more than £100bn every year.

Richard Murphy, a tax expert, is doing some quite interesting work in this area. It’s worth checking out his blog: http://www.taxresearch.org.uk/Blog/