Green Party to offer universal basic income
20 Nov 2019
The current benefits systems would be replaced with universal basic income (UBI) for all, says the Green Party in their manifesto
20 Nov 2019
The Green Party has also pledged to simplify the tax regime dramatically in order to encourage greater compliance.
As well as its flagship policy for a ten-year Green New Deal putting the UK on track to reducing carbon emissions to zero by 2030, the Greens have a number of initiatives designed to redistribute wealth, change the benefits system and tackle tax avoidance.
The party said it will: ‘straighten out the tax system, so that tax avoiders can no longer evade their responsibilities, and so that income from wealth is taxed the same as income from work. This will ensure that the wealthiest pay their fair share’.
The Green Party aims to merge employees National Insurance, capital gains tax (CGT), inheritance tax (IHT), dividend tax and income tax into a single consolidated income tax (CIT). It says this would mean that all income is treated the same way for tax purposes, regardless of whether it comes from investments or assets, or from work. The move is set to bring an estimated £20bn extra per year into the public purse.
The party also plans to replace the current income tax threshold with universal basic income (UBI) which it says would be rolled out by 2025. Every adult in the UK would get a payment of £89 a week, with more money available for certain groups who may not be able to work, such as people with disabilities, lone parents and people of state pension age.
This move is costed at £86.2bn which the Greens say will be met from tax changes and savings revenue from scrapping projects including the Trident nuclear programme, a number of road building developments, and the Help to Buy scheme. The party also expects to raise £76.7bn from a new carbon tax which will apply to all oil and gas extraction and to the use of petrol, diesel and aviation fuels. Frequent flyers will face a levy, while petrol and diesel cars will be phased out by 2030.
As regards business taxes, the Green Party pledges to increase the rate of corporation tax to 24%, in line with the OECD average, as well as advocating public country-by-country reporting and consolidated corporate tax across the EU to prevent profit shifting. It will also increase the bank asset tax, and close a loophole in the stamp duty on shares, by including share purchases of all values and new share issues within the tax.
There are proposals to establish HMRC as an independent agency of government, answerable to Parliament, on the grounds this will remove the power of politicians to strike secret deals with powerful corporations and individuals. The party will entrench the anti-avoidance principle in UK tax law and oblige banks to provide information about companies automatically to HMRC.
The manifesto has a number of ideas for reforming property taxes, including the introduction of a new land value tax (LVT), which the party says is designed to redistribute wealth and help fix the housing market. This will replace council tax and business rates, and will also absorb stamp duty land tax, the annual tax on enveloped dwellings, CGT on land sales, IHT on land and income tax on land for owner-occupiers.
LVT will charge the landowner a proportion of the capital value of the land each year (estimated to be around 1.4% of current values). The Greens say landowners will be liable for the tax regardless of whether or not they live on the land, claiming this will incentivise those who own empty properties to release them back into the housing market.
The new tax will be phased in over ten years, with reliefs on offer for those, for example, who have low incomes but large properties. The Greens estimate the LVT will be revenue neutral for the first ten years, bringing in the same amount of revenue as the taxes it replaces.
The Green party currently has one MP, Caroline Lucas, who represents a Brighton constituency, as well as seven MEPs. In the general election the party is stepping aside in 50 seats across England and Wales to make way for the Liberal Democrats and Plaid Cymru, as part of the ‘Unite to Remain’ agreement on Brexit. In exchange, the Lib Dems will not compete with the Greens in nine seats, including the Isle of Wight, Bristol West, Exeter and Brighton Pavilion.