On the day that the ballots for the Scottish Labour leadership opens, Richard Leonard has launched his manifesto for Real Change.
In his manifesto, Mr Leonard says:
“Scottish Labour is at a turning point: we can once again become a party of real change, offering people a sense of hope out of despair.
He adds: “During the leadership campaign we have set out very detailed policy proposals, aimed at transforming Scotland and eliminating poverty. With this manifesto I have set out more new ideas, including on justice and safety, climate change, and our arts and culture. Centrally, this manifesto sets out plans for the most profound change in how Scotland works – including the three pillars of a new approach for Scottish Labour’s taxation policy, that is more progressive, unlocks the vast untapped wealth of Scotland, and is based on a democratic course of action.
“Taken together these ideas represent a plan for a step change in the politics of Scotland.”
On tax he outlines a new approach for Scotland under the headline “A generational change in tax”:
“In this campaign, I have said that we need a once-in- a-generation discussion about taxation in Scotland. I now want to set out more of what that means.
“The Scottish Parliament now has the powers to vary income tax bands and rates. I wish to lead our Party’s discussion on how to make income tax more progressive. But it is clear that we cannot look at taxation by looking at income tax in isolation. We must tackle endemic low pay in the economy, specifically by rolling out the Scottish Living Wage and moving towards a secure, full employment, high wage, high value economy. And by promoting trade union organisation and collective bargaining in general, including sectoral bargaining.
“But any debate on taxation must also consider the taxation and treatment of wealth as well.
“So today I am setting out the basis of my consultation to initiate a debate and so a change in Scottish Labour policy.
“There are three pillars to the transformative tax policy that I want to see.
These pillars are:
1 . Progressive
Scottish Labour has moved on tax policy but we have not completed the journey. The principle that we need to adopt is that the burden of taxation must fall progressively on the broadest shoulders. This is the fundamental point of ‘the many, not the few.’ Measures that raise tax revenue overall but do so by shifting the burden onto the least well off or those struggling to get by on middle incomes are not progressive, and will fail to deliver the transformation we need. As an indication of this, our consultation will specifically look at a more graduated tax system such as two additional new bands: one around those earning over £70,000 and one on those earning over £100,000.
2. Unlocking wealth
Government revenue arising from income tax and national insurance raises three times (46 per cent) as much as the combined revenue raised from companies and wealth. Wealth taxes only account for 4 per cent, corporation taxes are 11 per cent and indirect taxes contribute 29 per cent.
The Scottish government has acknowledged the problem of growing wealth inequality but has proposed no solutions. http://www.gov.scot/Publications/2017/02/6032
Our economic policy must unlock wealth and put it to work - both to redistribute from the few to the many but also to raise the level of investment and transform the economy. Failing to do so will merely be tinkering at the edges.
Therefore, the time has come for a wealth tax. Just a one per cent windfall tax on the wealthiest 10 per cent would raise £3.7billion and put wealth back to work for the economy as a whole.
What is required is a once in a generation change in the structure of the Scottish economy. A changed, progressive tax policy is key to that. This cannot be done as a top-down measure, imposed by one or two politicians. This is about transforming Scotland.
So we will create rounded policy to raise investment and make Scotland more equal, involving the whole of the Scottish labour movement, working collaboratively with the Scottish public, academics, community activists, and the third sector, ending with a democratic conference decision by the Scottish Labour Party. That policy must also include other progressive elements, such as on the environment.”