Why I love taxes

As the Bevan Foundation’s proposals for new, devolved taxes are published today, Victoria Winckler considers why we should be bothered about tax.

Before we began our work on devolved taxes, I guess I was like most people: I paid my taxes, occasionally looked at my pay slip and cursed how much goes in PAYE and National Insurance, and listened with a resigned personal as well as professional interest to annual budgets.  In the last few months, I’ve not only learned a great deal about the tax system but I have also come to love taxes. I think taxes are great!

We are fully expecting a reaction from many of those who don’t share this view. Indeed anti-tax views have seeped into  our everyday language – we cheerfully talk about ‘the tax burden’ and ‘tax payers money’ without a second thought. This needs to change.

Taxes – or at least taxes that are fair, efficient and cannot be avoided – are actually part of the glue that holds our economy and society together.  Without taxes there would be no defence, no policing or justice. Without taxes there would be no education system, no NHS and no pensions. Without taxes there’d be no roads, street lighting or refuse collection. By casting taxes as a ‘burden’ we are also condemning the good things that the vast majority of people want.  To put it bluntly, if we want an NHS, an education for our children, pensions for older people and our streets swept then we better learn to love taxes not curse them.

But taxes are more than that too. Taxes are potentially a very effective way of changing people’s behaviour – we’re well used to so-called sin taxes on tobacco and alcohol. And we’ve taken – without complaint and with considerable benefit – to the charge on carrier bags – a tax in all but name. And with a tax on sugary drinks on the horizon it’s clear that at least the UK Government is persuaded of the case for extending taxes to other ‘sins’.

This is why the potential to develop new, devolved taxes under the provision of the Wales Act 2014 is so important.

Here is something that allows the Assembly to raise money to spend on good things for Wales, and to dissuade people and organisations from acting in a particular way. It’s one of a set of tools at the Assembly’s disposal, along with legislation and policy, and they could really make a difference. Just imagine if the success of the carrier bag charge – a 70% reduction in use for just 5p a bag – could be replicated in other areas, whether it’s use of sunbeds, disposal of polystyrene litter or an increase in r&d activity. The potential of new taxes should, in our view, be grabbed and grabbed with enthusiasm.

You may or may not agree with the specific taxes we propose, and they will all need far more work than we have been able to carry out in a short space of time. But the Assembly should not be shy of talking about tax – and if the Welsh Government doesn’t wish to pursue one then perhaps a private members bill might get a proposal on the agenda.

Victoria Winckler is Director of the Bevan Foundation. The report is available here.