Compass calls for 'progressive' tax reforms

Date: 16th December 2009

Reforms to Britain's current tax system were advocated today (December 16th) by the campaigns organiser of progressive thinktank Compass.

Joe Cox recommended "progressive" measures, including a reintroduction of the ten per cent income tax band for low-paid workers and a lowering of the planned 50 per cent income tax threshold from earnings of £150,000 per year to £100,000.

The comments follow the controversial changes introduced in last week's Pre-Budget Report by chancellor of the exchequer Alistair Darling.

Among the measures was a one-off 50 per cent super-tax on bankers' bonuses of £25,000 and above - to be paid by the banks themselves.

Following the announcement, accountancy firms expressed concerns that tax reforms of this kind could reduce Britain's business competitiveness by encouraging star performers to move overseas.

Mr Cox said: "Unemployment, reduced hours and pay freezes always hit the most vulnerable hardest which is particularly unfair considering this crisis has been caused by the most highly paid in society."

A recent report from the New Economics Foundation suggested that, over the past 30 years, the average ratio of the earnings of the typical employee and the typical chief executive has risen from 47:1 to 128:1.

Posted by Thomas Fletcher