IPPR, the Institute for Public Policy Research, describing itself as "the UK’s leading progressive thinktank", has just released an essay by a Chris Nicholas, "Fairer taxes for a better economy" This sounded promising. There is a section on taxing wealth. Nicholas writes

"Closing the circle both fiscally and progressively, a general wealth tax would be introduced. The new tax would be levied on all holders of wealth, including both individual and corporate entities, with total net wealth over £150,000 at a progressive rate of 0.5–1.5 per cent per annum. Inheritance tax would be overhauled to dovetail with this new tax, capturing significantly more wealth than at present but taxing it at initially lower, then progressive rate."

The document is, unfortunately, mostly in a gobbledygook style of English. It verges on the unreadable. This makes it impossible to discern the line of argument, if indeed there is one. It is full of unsubstantiated assertions. Presumably the authors think they can be taken for granted.

The whole rests on a shaky foundation of assumptions which are also pretty much impossible to discern clearly. "Wealth" is never defined, nor does the author explain why, in principle, it ought to be taxed. Nor does is "fair" defined. He refers to the ill-effects of the present tax system, which he attributes, without further reflection on the matter, to the under-taxation of wealth. The fact that the proposal chooses an arbitrary threshold is always the indication of a lack of sound principle. Why is something worth £149,000 not wealth? And how is this value established anyway?

The author objects to the idea of a land value tax, which he seems to think would unduly penalise both the wealthy and the poor owner-occupier, thereby revealing his home-ownerist credentials. Nicholas clearly does not understand land value tax or the economic analysis that underpins it or he would not have made the comments that he did. It is a shoddy document and reflects poorly on the IPPR. The organisation should impose proper quality-control to ensure that this kind of thing does not go out under its name.

Mark Wadsworth has done a thorough demolition job which you can read on his blog here.

The tax avoidance industry has been spawning a tax avoidance protest industry, with the Guardian in the lead. It focusses on the non-crimes committed by firms such as Google, Amazon and Apple, who have de-localised their activities so that it is impossible to establish exactly where they are trading. The Guardian has run a whole series of features this week about the online trading company Amazon.

Amazon occupies premises in the UK and no doubt pays rent and UBR for the privilege. So the obvious conclusion would be to forget trying to collect corporation tax and raise the bulk of revenue from a tax on fixed property instead. But this obvious conclusion is not one that the Guardian journals have drawn, nor is it to be found amongst those that are shocked by the terrible revelation that these companies are exploiting the loopholes in the tax laws.

The Bangladesh factory scandal has been followed by a round of breast-beating, as if firms that sell cheap clothing, or their customers, were to blame and could do something about the situation, even if it was just to apply political pressure.

The wages of labour are in all circumstances the least that people will accept. If there are no other opportunities for earning a livelihood, then people will accept penurious wages. If the employer is paid more for the produce, the extra will most certainly be retained by the employer as profits. In due course, the higher profits will be retained by the landlord in the form of higher rents, so the benefits do not even go to the employer. That is the Law of Rent when all land is enclosed and its rent privately appropriated.

The situations in Bangladesh is only possible when land ownership is concentrated in the hands of a few families, who, as recipients of rent, become enormously wealthy. Until that is changed the majority of the population will live in abject poverty. The cheap clothing retailers are not going to start campaigning for land reform, as that would quickly draw attention to the existence of much the same situation on home territory. The breast-beaters do little to help either. They rarely take a step back to assess the situation as a whole; if they did, they would, for a start, notice that poor working conditions in clothing factories is only part of a much bigger problem which exists throughout the supply chain, from what are virtually slave-labour farms in cotton-growing countries such as Uzbekistan, where child labour is used and workers are continually exposed to dangerous chemicals, to poor living conditions for those who crew the ships that bring the goods across the world.

CAROLINE LUCAS WRITES
"My Bill wasn’t discussed on Friday 26th April as it wasn’t a sitting day in the end. It was down on the Parliamentary papers for that date as a way of keeping the Bill ‘live’ for as long as possible. However, I knew that it wouldn’t have any chance of actually being debated. The Bill has now fallen as the Parliamentary Session has formally ended.

"It is confusing and this place does work in a ridiculous way! I have been trying to make the best use that I can of the limited mechanisms available to backbench MPs to help get the debate on LVT going and I think we’ve had some success in that. I’ll keep taking up the opportunities that come up to press the Treasury on this – they really shouldn’t be ignoring this issue or the likes of the IFS Mirrlees Review and the OECD."

The US Senate is apparently considering legislation to require online retailers to pay state sales taxes. It would be misguided. Politicians and bureaucrats should accept contemporary realities. Transaction taxes have been made obsolete by technology. Corporation taxes have been made obsolete by globalisation, again partly through technology. Taxes on people have been made obsolete because they are becoming increasingly mobile. Instead of worrying about the leaks and talking about how to plug them, this is something that everyone needs to get used to.

The only viable tax in the future will be one levied on the annual rental value of land. Land isn't going anywhere. It cannot disappear into cyberspace.