A Scottish Labour MSP has said that she will “shed no tears” for those who leave the country to avoid a wealth tax in a public condemnation of the Scottish Secretary's stance on the policy.
Writing in The Herald, Mercedes Villalba, Scottish Labour MSP for the North East region, accused the Government of “a number of misleading premises” in their opposition to a wealth tax, which she says “largely go unchallenged by the national media”.
A wealth tax is a form of taxation which is designed to collect money from an individual’s total assets as opposed to specific levies on income or property. Proposed wealth taxes have included a levy on cumulative wealth - including everything from property, to investments, to art.
The idea of the policy is that it could make the tax system fairer by directly targeting accumulated assets.
The policy has recently emerged as a key dividing line in the parliamentary Labour Party in both Westminster and Holyrood.
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Last week, Scottish Secretary Ian Murray dismissed the idea of the UK Government implementing a wealth tax, saying that there was “no silver bullet” to the country’s economic woes.
Speaking to the Comedian Matt Forde at the Edinburgh Fringe, Mr Murray said “[A wealth tax] doesn’t work. The Laffer curve [an economic theory which explains the correlation between taxation and government revenue] is there for everyone to see.
“So, yes, you can bring in a wealth tax, because it might make you feel principally better. You might bring in £200 million but the cost of doing that would be huge because there is just flight, whether we like that or not.”
She went on to say that she believes that “all financial wealth originates from human labour”.
“It would therefore take a mass exodus or nationwide risk to life for wealth creation in a country to cease.”
“We need only look at the hit private profit would have taken during the pandemic had the state not stepped in to shore it up to see the primacy of human labour evidenced.
“A significant proportion of wealth is in immobile assets like land, property and British-based businesses…This wealth cannot up sticks and leave with an individual. The resources remain in the country and are subject to taxation.
“We know we won’t lose wealth creation as long as we have a fit and able population to do the work.
“In fact, the greatest risk to wealth is workforce shortages caused by a public health service on its knees, an undervalued public education system and a cost-of-living crisis deterring new parents. In short, the greatest risk to wealth is continuing to let it go untaxed.”
The Scottish Greens have also recently made fresh calls for a wealth tax in response to “soaring” CEO pay.
Discussing new figures which showed that some British Executives’ pay had reached over 100 times that of the average worker, MSP Maggie Chapman said: “A wealth tax is now a necessity, to make sure that those who have enriched themselves the most pay their fair share.”
Rachel Reeves refused to be drawn on a wealth tax when quizzed by journalists earlier this month.
She said the UK Government had to “get the balance right on taxation” but stressed the “number one priority” was growing the economy.
