Clegg renews his push for a mansion tax

The Deputy PM warns that coalition support will fade if the rich are not targeted.

It's Nick Clegg's turn to pitch his tent on the increasingly congested terrain of "responsible capitalism" today. As I write, Clegg is delivering a speech at Mansion House in which he makes a distinctively liberal argument for reforming the market. Calling for workers to be given the right to request shares in the companies they work for, he argues:

John Stuart Mill hoped that employee-owned firms could end what he called the 'standing feud between capital and labour'. And liberals have been championing it ever since. We don't believe our problem is too much capitalism: we think it's that too few people have capital. We need more individuals to have a real stake in their firms.

Encouragingly, we also learn this morning that the Deputy PM has renewed his push for George Osborne to adopt some form of property tax. There's no chance of the Chancellor adopting a "mansion tax" immediately, not least because the 50p tax rate will now remain for the duration of the parliament, but it's possible that he will set up a review to look at raising more from the rich by shifting the burden of tax from income to wealth and act to reduce stamp duty avoidance.

As NS editor Jason Cowley argued in a October 2010 cover story ("The coming battle over land and property"), there is a strong meritocratic argument for heavier taxation of unearned wealth (inheritance, property and land) and lighter taxation of earned income. Property taxes are harder to avoid than those on income (you can't move a mansion to Geneva) and reduce the distorting effect that property speculation has on the economy. For the psephologically minded, it's worth noting that high-end property taxes are popular. A recent YouGov poll found that 63 per cent of the public, including 56 per cent of Tories, support a mansion tax, with just 27 per cent opposed.

Clegg's warning that public support for the coalition's deficit reduction programme could fade unless the rich shoulder more of the burden is a prescient one. Those who have benefited immensely, through little effort of their own, from the dramatic rise in house prices over the last decade are an obvious target. Labour, which has been curiously absent from this debate, should not miss a rare opportunity to make common cause with the Lib Dems.

Update: In the Q&A session following his speech, Clegg played down hopes of a mansion tax - "I lead a party with eight per cent of MPs in parliament" - but said he still hopes for "progress" in this area.

George Eaton is political editor of the New Statesman.

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Who will win the Copeland by-election?

Labour face a tricky task in holding onto the seat. 

What’s the Copeland by-election about? That’s the question that will decide who wins it.

The Conservatives want it to be about the nuclear industry, which is the seat’s biggest employer, and Jeremy Corbyn’s long history of opposition to nuclear power.

Labour want it to be about the difficulties of the NHS in Cumbria in general and the future of West Cumberland Hospital in particular.

Who’s winning? Neither party is confident of victory but both sides think it will be close. That Theresa May has visited is a sign of the confidence in Conservative headquarters that, win or lose, Labour will not increase its majority from the six-point lead it held over the Conservatives in May 2015. (It’s always more instructive to talk about vote share rather than raw numbers, in by-elections in particular.)

But her visit may have been counterproductive. Yes, she is the most popular politician in Britain according to all the polls, but in visiting she has added fuel to the fire of Labour’s message that the Conservatives are keeping an anxious eye on the outcome.

Labour strategists feared that “the oxygen” would come out of the campaign if May used her visit to offer a guarantee about West Cumberland Hospital. Instead, she refused to answer, merely hyping up the issue further.

The party is nervous that opposition to Corbyn is going to supress turnout among their voters, but on the Conservative side, there is considerable irritation that May’s visit has made their task harder, too.

Voters know the difference between a by-election and a general election and my hunch is that people will get they can have a free hit on the health question without risking the future of the nuclear factory. That Corbyn has U-Turned on nuclear power only helps.

I said last week that if I knew what the local paper would look like between now and then I would be able to call the outcome. Today the West Cumbria News & Star leads with Downing Street’s refusal to answer questions about West Cumberland Hospital. All the signs favour Labour. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.