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Daily Record
Daily Record
Politics
Paul Hutcheon

Scottish Government adviser backs 70 per cent tax rate to aid fight against coronavirus

An advisor to the Scottish Government on coronavirus has backed a 70 per cent tax rate to cope with the pandemic.

Professor Stephen Reicher said he was not suggesting World War Two levels of tax, but claimed a much higher rate than at present would be “fine”.

Official figures showed the UK economy shrank by 2 per cent in the first quarter of 2020 - the biggest fall in GDP since the 2008 financial crisis.

Treasury documents revealed the UK Government may have to hike income tax and freeze public sector pay to address the deficit caused by the virus.

Chancellor Rishi Sunak said yesterday it was “very likely” the UK economy will face a “significant recession” this year.

Days before the grim figures appeared, Reicher wrote about Prime Minister Boris and tax on his Twitter account.

“Johnson’s message yesterday was full of war-talk. Well, remember, to ensure everyone played and paid their part in the war effort, top-rate income tax went up to 99.25% in the UK and 90% in the US during WW2. I’m not suggesting we go that far this time. 70% would be fine.”

The top rate of tax south of the border is 45% - it was cut by David Cameron’s government - and 46% in Scotland.

It has been predicted the number of Scots paying the top rate will increase from 14,900 in 2018 to to 22,000 in 2023-24.

(PA)

Reicher, a social psychologist at St Andrews University, was announced as one of the experts on a Scottish Government group set up to understand the potential impacts of covid-19 on Scotland.

He told the Record: “My argument is based on the fact that social cohesion depends upon a sense of equity. The problem is that pandemics generally increase inequality and that in turn can lead to social disorder.

“The poorer parts of the population have been paying far more for this pandemic than the more affluent. 44% of people are suffering from lockdown according to a recent survey. Poor people are less likely to be able to work from home, they have to go out more and are more likely to get infected and die by at least a factor of two.

“So, in terms of equity, it seems only fair that the more comfortable sectors of the population play their part and pay their bit in getting us through this pandemic and helping us rebuild afterwards.

He added: “The 70% is a suggestion – specifically about top-rate tax. I am not wedded to it and think the real conversation should be around how we all play our part.”

Patrick Harvie, the co-leader of the Scottish Greens, signalled support for the idea: “There is a real danger the UK Government’s instinct when it comes to paying the cost of the pandemic will be heap it onto people on middle incomes, as well as on those who rely on the social security system and public services. Scotland cannot follow this approach.

“Instead, we should be looking at the level of tax paid by wealthiest, and by corporations which have been given a free pass by successive governments.”

A Scottish Government spokesperson said:

“We have no plans to increase taxes. Our economic response to this pandemic has been unprecedented, as we aim to help businesses and individuals through the crisis, while we already have the fairest taxation in the UK, protecting lower and middle income taxpayers, while raising additional revenue to support our economy and invest in the widest range of free-to-access public services in the UK.”

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