Letters | 9 May 2009

Taxing questions

Sir: Fraser Nelson writes (‘A tale of two Gordons’, 2 May) that internal Treasury documents justify the 50p tax rate on the basis that ‘Karl Marx’s progressive tax structure was designed so that the tax burden was heaviest on those who were most able to contribute’.

Certainly, Labour spokespersons daily repeat this cosy doctrine about the taxation of the rich, in exactly these words. But where is Marx supposed to have said it?

For Marx, the demand for progressive taxation was purely part of his revolutionary programme to destroy existing social institutions, not to make them fairer. In his time, the most that reformers were demanding was that all rich people should pay the same amount in tax as everybody else. But if a reforming government did become more radical, he said, and should come to propose proportional taxation, ‘the workers must demand progressive taxes’. Then, if a reforming government should put forward a moderately progressive tax, ‘the workers must insist on a tax that rises so steeply that big capital will be ruined by it’. As far as I know, that is the only line that Marx ever followed on either flat, proportionate or progressive taxation.

It would be interesting to discover whether the writer of the Treasury memo is simply ignorant of what Marx actually had to say on the subject, or knows it only too well.

Norman Dennis
Director of Community Studies, Civitas
London, SW1

Sir: Fraser Nelson is a logical man, so could he please answer the following points. The Thatcherite wing of the Conservative party cite 1979-1990 as a period of industrial and entrepreneurial renaissance for UK Plc. Until 1988, however, the top rate of income tax was set at 60 per cent. Michael Caine was warmly welcomed back from tax exile by Margaret Thatcher during this period.