The only way to sustainably finance the costs of social care and the NHS for an ageing population is a growing economy, so why is the Chancellor taxing work? He said at the last Question Time that the only way to tackle poverty was to encourage work, but he is taxing work, and specifically he is taxing poorer, younger workers who do not have assets to pay for the care costs of often richer, non-earning, asset-rich people. It is not fair, it is not economically effective, it is being rushed through—it is wrong in so many ways that it should just be scrapped.
Obviously, we need to pay for care costs. It is appalling that one in four people will be hit with massive care costs through no fault of their own, and we need a system that is fair in terms of taxation to pay for that. I am not a great fan of hypothecation, because we should be deciding how to tax in a fair and economically sensible way and setting out precisely what we are going to spend our money on, neither of which has been done. If we want to grow the economy and tax things that we do not want to occur—people have talked about alcohol and cigarettes—we should be tackling, in particular, air pollution. I say this as the chair of the all-party parliamentary group on air pollution. Air pollution costs us £20 billion in lost productivity and health costs, so why do we not have some sort of escalator on diesel? Why do we not have an incinerator tax? The plan is to double incineration by 2030, yet we read from the latest medical reports that a very small increase in NOx massively increases dementia and mental health issues by something like 32%, with an 18% increase in hospital admissions. We have heard new research about ultrafine particulates from incinerators in urban environments getting straight into the bloodstream and causing problems for the heart, the mind and the lungs in particular, but there has been no mention of any of this.
And what about plastics? There will be more plastics than fish in the sea by 2050. We plan to tax plastics at £200 per tonne, but in the EU the figure is £685 per tonne. If we put an extra £400 per tonne on the 12 million tonnes of plastic we produce each year, we would
generate £5 billion. Why should we not be able to get a cheaper cup of coffee in a china cup than in a plastic one? That would save the environment.
I support the points that were made by my right hon. Friend the Member for Barking (Dame Margaret Hodge) and others on progressive taxation. Gordon Brown had a national insurance increase all the way up the income scale. Obviously we need a threshold if we are going to use national insurance. Lord Hendy is now putting forward the Status of Workers Bill, which would capture large numbers of people who are currently deemed to be self-employed so that their employers do not have to pay national insurance. In that way, we could have a larger tax footprint, which would be fairer.
Obviously companies such as Amazon should pay more and there should be a transactions tax. Landlords have made capital gains through stamp duty holidays and with interest rates at low levels, and we should also look at a carbon border tax at a time when China is producing more emissions than the United States and the EU combined.
We should tax the bad things—namely, climate change and pollution—not the good things such as work and the economy. On debt costs, the interest rates have been low—they are down £14 billion year on year—and this looks like another attempt to bring down the debt. We must tax the right things, not the wrong things, to sort out the problem.
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