Latest news with #EqualityTrust
Business Mayor
24-05-2025
- Business
- Business Mayor
The Guardian view on billionaire Britain: tax wealth fairly or face democratic unravelling
B ritain for the last decade has experienced a bleak paradox: rising child poverty alongside a dramatic increase in billionaire wealth. This inequality has been tolerated partly because greed has been rehabilitated as virtue. The Billionaire Britain report, published this week by the Equality Trust, reveals what many instinctively feel but few in parliament will admit: the UK economy has become a machine for the upward redistribution of wealth. Using Sunday Times Rich List data, the report found that the 50 wealthiest UK families now own more than the poorest half of the population combined. Their opulence is no accident. It's largely built on the labour and consumption of those 34 million other Britons. The gains of society are being hoarded by those least in need. There's a lexicon that sells it all as 'entrepreneurial spirit' and business dynamism. But the very markets that reward the wealthiest so handsomely are constructed and policed by the state. Governments entrench intellectual property rights, strengthen legal monopolies and write policies that benefit banks and asset markets. Austerity was imposed on the many, even as a decade of quantitative easing created fiscal space that could have been used for public good. Instead it enriched the already wealthy by inflating property and share prices while tax cuts benefited the rich. A small correction to pandemic-driven gains for the billionaire class signifies no major shift. Their fortunes are 10 times larger today than they were in 1990. Louis XIV's finance minister said good tax policy plucks the most feathers with the least hissing. It was suggested that the government's small-scale tax rises had triggered a full-blown squawk. More than 10,000 millionaires, it was reported, had fled the UK in 2024. The source? Not actual migration data, but a firm selling second passports to the nervous rich. It is hard to not think such a company feeds on tax panic. Its numbers appear more astute marketing than solid evidence. Labour should be immune to such public relations stunts. Billionaires do not emerge in a vacuum. They are the product of deliberate choices. Property speculation, inheritance laws and tax avoidance schemes are not spontaneous market outcomes. They are often lobbied for by people with access to government, on behalf of those who stand to profit. It's no accident, then, that over a quarter of UK billionaires built their wealth through property and inheritance, and another quarter through finance – sectors that rely on rent extraction more than innovation. The rich get richer because political leaders protect that growth – often in service of their own ambitions. A Britain governed in the public interest must not defer to a plutocratic class. There needs to be a break with the current model. Politicians could, as a start, take up Tax Justice UK's idea for a 2% wealth tax on assets over £10m. Campaigners say this would raise £24bn annually – enough to begin repairing broken Britain. Oxfam says 78% of the public would support such a progressive levy. Yet such proposals are still framed as radical. What's radical is that monopoly profits end up in private hands while the state can't fund public services. It is inescapably true that the rules have been written to benefit a tiny elite. They can be rewritten. If not, then the cost to society risks being paid in populist anger, democratic decay and a long-term loss of trust.
The Guardian
23-05-2025
- Business
- The Guardian
The Guardian view on billionaire Britain: tax wealth fairly or face democratic unravelling
Britain for the last decade has experienced a bleak paradox: rising child poverty alongside a dramatic increase in billionaire wealth. This inequality has been tolerated partly because greed has been rehabilitated as virtue. The Billionaire Britain report, published this week by the Equality Trust, reveals what many instinctively feel but few in parliament will admit: the UK economy has become a machine for the upward redistribution of wealth. Using Sunday Times Rich List data, the report found that the 50 wealthiest UK families now own more than the poorest half of the population combined. Their opulence is no accident. It's largely built on the labour and consumption of those 34 million other Britons. The gains of society are being hoarded by those least in need. There's a lexicon that sells it all as 'entrepreneurial spirit' and business dynamism. But the very markets that reward the wealthiest so handsomely are constructed and policed by the state. Governments entrench intellectual property rights, strengthen legal monopolies and write policies that benefit banks and asset markets. Austerity was imposed on the many, even as a decade of quantitative easing created fiscal space that could have been used for public good. Instead it enriched the already wealthy by inflating property and share prices while tax cuts benefited the rich. A small correction to pandemic-driven gains for the billionaire class signifies no major shift. Their fortunes are 10 times larger today than they were in 1990. Louis XIV's finance minister said good tax policy plucks the most feathers with the least hissing. It was suggested that the government's small-scale tax rises had triggered a full-blown squawk. More than 10,000 millionaires, it was reported, had fled the UK in 2024. The source? Not actual migration data, but a firm selling second passports to the nervous rich. It is hard to not think such a company feeds on tax panic. Its numbers appear more astute marketing than solid evidence. Labour should be immune to such public relations stunts. Billionaires do not emerge in a vacuum. They are the product of deliberate choices. Property speculation, inheritance laws and tax avoidance schemes are not spontaneous market outcomes. They are often lobbied for by people with access to government, on behalf of those who stand to profit. It's no accident, then, that over a quarter of UK billionaires built their wealth through property and inheritance, and another quarter through finance – sectors that rely on rent extraction more than innovation. The rich get richer because political leaders protect that growth – often in service of their own ambitions. A Britain governed in the public interest must not defer to a plutocratic class. There needs to be a break with the current model. Politicians could, as a start, take up Tax Justice UK's idea for a 2% wealth tax on assets over £10m. Campaigners say this would raise £24bn annually – enough to begin repairing broken Britain. Oxfam says 78% of the public would support such a progressive levy. Yet such proposals are still framed as radical. What's radical is that monopoly profits end up in private hands while the state can't fund public services. It is inescapably true that the rules have been written to benefit a tiny elite. They can be rewritten. If not, then the cost to society risks being paid in populist anger, democratic decay and a long-term loss of trust.
The Guardian
19-05-2025
- Business
- The Guardian
UK's 50 richest families hold more wealth than 50% of population, analysis finds
The number of billionaires in the UK has grown sharply – from 15 in 1990 to 165 in 2024 – at the same time as inequality in the UK's overall wealth distribution has dramatically increased, analysis has found. Timed to coincide with the Sunday Times' rich list, the Equality Trust's investigation also found that billionaires have become 'ludicrously' more wealthy, with their average wealth skyrocketing by more than 1,000% over the same period. The top 50 richest families in the UK now hold more wealth than the poorest half of the population, comprising more than 34 million people. In 2024, the two richest UK billionaires held more wealth between them than all the billionaires in the 1990 rich list combined. 'Our analysis also shows the vampiric nature of extreme wealth, which is completely incompatible with the health and wellbeing of the nation,' said Priya Sahni-Nicholas, co-executive director of the Equality Trust. 'Property, inheritance and finance account for over half of total billionaire current wealth: sources of wealth creation that are responsible for large-scale planetary and community destruction. 'The obscene growth in wealth of the UK's richest is due to them profiting from society's struggles while causing them additional harm and undermining successive governments' goals of decarbonisation, spreading more wealth and growth out of London, ending the housing crisis, encouraging the growth of new – and frequently greener – industries, and encouraging stronger communities. 'The issue of extreme wealth really is existential; for our very survival we need to get serious about changing economic structures and design policies that end the existence of billionaires.' Julia Davies, a member of Patriotic Millionaires UK, said that inclusion in the rich list should be a mark of shame. 'This process of hoovering up wealth into the hands of ever fewer people is directly harming everyone. These people don't deserve that level of wealth, it just so happens that some people gather an incredible amount of money around them while other people don't, despite educating our kids and keeping our health service going.' Davies said it was wrong to call the wealthy 'job creators'. 'I call them job eradicators because when you consolidate businesses into the hands of ever fewer people, you're wiping out smaller and medium-sized businesses because they cannot compete with chains that undercut them. 'These people also employ such effective tax-management measures that they're paying far lower rates of tax to the local and national economy than working people or small to medium-sized businesses.' It did not have to be this way, she said. 'You can use wealth to accumulate ever more wealth or you can use it to address many of the multiple issues that society is struggling with. 'It's not intrinsic in being wealthy to want to continue to attract ever more wealth to yourself at the expense of society,' she said. 'That's not something that just happens to you when you become wealthy and we shouldn't just accept it. It's a choice.' Fernanda Balata, a political economist at the New Economics Foundation and author of Exploring An Extreme Wealth Line, said that the UK had gone down a route of economic instability while the government had put the super-wealthy above everyone else. That, she said, 'is not by accident.' 'There are so many connections now between the wealthy and the powerful, that it spills over into public institutions,' she said. 'This means politicians today are having to rely increasingly on lies and flawed narratives to keep the system going.' But Balata said there was hope. 'There is broad consensus now that extreme levels of wealth inequalities are causing multiple harms to society.' Balata said that politicians need to start looking at extreme wealth as an issue in itself. 'We need an Extreme Wealth Line: the point at which excessive wealth causes unjustifiable harm,' she said. Dr Benjamin Tippet, a lecturer in economics and wealth inequality at King's College London, has modelled what a 2% tax on those on the rich list would have raised, if the policy had been in place since the mid-90s. 'I discovered that a 2% wealth tax on the tax residents on the rich list would have raised about the equivalent of £6bn per year: £155bn,' he said. 'Invested, that would have been worth about £325bn in today's money – well over £11,000 per household. That's a significant national wealth fund. And even with this tax, the share of wealth of people on the rich list – the top 0.001% – would still have increased.'
