THE super-rich would face a 10% income tax hike unless they give generously to charity, under radical plans to be unveiled today by Mersey MP Frank Field.
The Birkenhead MP will condemn “the rise of the seriously mega-rich” under Labour who – unlike their counterparts a century ago – fail to give away their enormous wealth.
Mr Field will propose a new 50% tax rate on incomes and dividends above £150,000, which would raise £3.6bn a year for the Treasury.
But, crucially, the rich would avoid the 10% increase if they set up charitable foundations, to “tackle the wider problems of our society and not simply to advance their own financial success”.
Mr Field called his idea “acceptable behaviour contracts for the super-rich” – a term applied to attempts to force troublemakers to behave.
In a lecture to the Allen Lane Foundation, a famous charitable trust, he will say: “The contract between great wealth and philanthropy has been fractured.
“Contracts on acceptable behaviour have been imposed on miscreant youths who do not fulfil properly their obligations to a society that supports them.
“Similarly, I believe acceptable behaviour contracts should now be applied to today’s super-rich.”
Mr Field – who has long praised Gordon Brown’s commitment to ending poverty, but attacked his methods as doomed to failure – will say Britain is now a “billionaire’s paradise”.
There are 30,000 people earning more than £500,000 a year and a study had found 54 billionaires – with a £126bn fortune – paid just £14.7m in income tax. A century ago, the mega-rich of the Edwardian era, such as the Merseyside shipbuilders, or the soap-makers who built Port Sunlight, were major employers, as well as philanthropists.
In contrast, today’s wealthy elite, concentrated in the City of London, gave work to very few people and – with a few exceptions, such as Lord Sainsbury – kept their multi- millions.
However, Mr Field will argue against increasing the share of national income spent by government, arguing Labour’s record spending has produced “modest outcomes”.
Instead, the Labour backbencher will say his idea will encourage the growth of the “great foundations” set up by the Edwardian super-rich, for the benefit of all.
He will say: “Some of the rich may believe that life would be simple if they simply paid the additional tax to the government, but I would hope that their numbers would be very small indeed.”
Recently, Mr Field – for so long a bitter enemy of the prime minister – has been invited to No.10 for a series of meetings, although Mr Brown has not offered him a job.
But, in a fresh schism with the Labour leadership, he has been threatened with suspension for joining the campaign for a referendum on the EU Treaty.
