Image by: Chris Devers

A poll last year found that people are delaying having families, because the future looks insecure.

Recently the Financial Times asked young people about their hopes for the future. It’s not only “just about managing” families facing an uphill struggle. According to the FT, it’s also company directors, city traders and computer programmers too.

The thing that unites these people is that they are young and have almost no chance of earning their way to wealth.

Having a good job is no longer a guarantee of a comfortable and secure lifestyle. As the Institute for Fiscal Studies pointed out this week, inheritance is set to be a key factor driving inequalities in future years. Whether you can afford to buy a place to live is increasingly determined by whether your parents own property.

This is made worse by the tax system. At Tax Justice UK, we’ve pointed out that wealth is taxed at a lower rate than income from work. This is just one way that the truly wealthy have access to unfair tax advantages.

It’s hard to see how governments can ignore this problem forever. And as the Financial Times' economics editor has said: "the left is winning the economic battle of ideas".

All parents and grandparents want the best future for their children. Everyone deserves a fair shot at building a secure life for themselves and their kids.

As we build back from Covid we will campaign to have a tax system that works for all of us. We will make sure this is an issue that stays at the top of the list for politicians.

​For a longer read on how access to wealth is key to understanding class in modern Britain take a look at this excellent essay from Christine Berry for the think tank Autonomy.

New analysis suggests that the UK would raise an extra £13.5 billion a year from a global minimum corporate tax rate set at 20%. This would rise to over £22 billion a year if the rate was set at 25%. Companies like Amazon, Apple, Facebook and Google could face significantly higher tax bills.  

President Joe Biden has proposed a sweeping overhaul of how big international companies are taxed. This includes a new minimum tax rate which would help crack down on corporate tax avoidance. 

The public is fed up with major companies getting away with paying ultra low rates of tax. A new minimum corporate tax rate would bring in billions of pounds to support public services and would deal a blow to tax dodging. As we build back from covid we should ask big business to contribute more given the support they’ve had during the pandemic.

The Biden administration has suggested a global minimum corporate tax rate of 21%. The Independent Commission for the Reform of International Corporate Taxation has proposed a minimum rate of 25%. Rishi Sunak has pledged to increase the UK’s corporate tax rate to 25% in 2023.

So far the UK government has been silent on whether it backs the US corporate tax reform plan. 

The government should stand up and support these proposals. The UK and its tax haven network have long promoted a global race to the bottom on corporate taxes - this needs to end.

A new minimum corporate tax rate would have a big impact on places like Ireland, the Netherlands and the Cayman Islands which have ultra-low corporate tax rates. The plan comes as international negotiations on global tax reform at the OECD club of rich nations gather momentum. 

The analysis is contained in a soon to be published paper by international tax experts on how to implement a global minimum effective tax rate (METR) for multinational companies. The paper breaks down the expected revenue for a number of countries for different minimum tax rates based on a methodology from the OECD club of rich nations.
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The METR proposal is authored by Sol Picciotto, Jeffery M. Kadet, Alex Cobham, Tommaso Faccio, Javier Garcia-Bernardo, and Petr Janský. In advance of the forthcoming study, details of the proposal are available here.


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We're looking across the pond for inspiration. President Biden has just announced plans for $2 trillion of investment in America’s crumbling infrastructure.

Biden wants to upgrade roads, railways and bridges. The plan includes money to green the economy, as well as investment in looking after vulnerable Americans. This is transformative amounts of money. 

The infrastructure plan would be paid for by increasing taxes on companies. The President wants to reverse some of Donald Trump’s tax cuts. Biden is going after multinational companies that pay too little tax. 

Biden has also said that it’s time for countries to end the “race-to-the-bottom” on how companies are taxed.

This is music to our ears.

It fits with a growing pattern of politicians making the case for higher taxes on companies. In the UK, the Chancellor, Rishi Sunak, has said that the corporate tax rate will go up to 25% from the current 19%.

At the moment we have promises. And we all know that politicians are often bad at turning their rhetoric into reality. 

But it gives us hope to see President Biden setting out a vision for high quality public services backed by a more progressive tax system.

At Tax Justice UK we will work to make sure that our political leaders take notice.

If you haven't already, sign up to our weekly tax justice roundup here. 

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