The Trillion Pound Pie: Scottish wealth inequality laid bare
Scottish Labour has heralded a new report from the Resolution Foundation as the latest piece of evidence supporting the party’s proposal for a wealth tax, as the very rich grow even richer.
In a single decade, total wealth in Scotland has ballooned to be seven times as large as the country’s GDP, but that wealth is not shared equally. A quarter of the Scottish population have less than £500 in their bank account - 3 per cent more than the UK average. And the speed at which wealth is growing has rapidly outpaced incomes - with most of the gains going to those at the very top.
Most Scottish wealth is holed up in pension funds, which are average around £70,000 per household - £12000 more than in the rest of the UK. In fact, pension funds in Scotland account for more than half of all wealth in the country.
As the Resolution Foundation points out, the biggest ‘wealth tax’ - the council tax - is already full devolved, and while the Scottish Government’s tinkering around the edges have resulted in a modest improvement, there’s still a long way to go.
Torsten Bell, Director of the Resolution Foundation, said:
“Wealth in Scotland has grown fast in recent years and will come to play a bigger role in determining life chances in the decades to come.
“This increase in wealth across Scotland has sat alongside falling home ownership rates, particularly for young families, who are struggling to accumulate wealth as preceding generations have been able to.
“The accumulation, distribution and taxation of wealth should be at the centre of policy debates in Scotland in the years ahead. If current trends continue it will become much harder in modern Scotland to earn your way to being truly wealthy, and young people’s prospects will depend less on their ability, and more on whether or not they inherit assets from relatives.”
Scottish Labour leader Richard Leonard said:
“This report lays out the real divide in Scotland – between the richest few and the rest of us. That’s why I believe it is high time to have a once in a generation debate around taxing wealth.
“It cannot be right that, while 1 in 4 children are growing up in poverty, the richest 1 per cent own more personal wealth than the poorest 50 per cent.
“Just a 1 per cent windfall tax on the wealthiest 10 per cent in Scotland could raise £3.7billion and put wealth back to work for the economy as a whole.
“This is no time to tinker around the edges. We need real change, not just more of the same: a more balanced economy in a more equal Scotland built on higher investment, better public services and one where the broadest shoulders bear the biggest burden. That’s the kind of Scotland Labour wants to build.
“That’s why Labour will continue to argue that the richest should pay their fair share.”