To boost wages, alter the balance of power in offices

Publishing income tax records could help predistribute wealth.

Publicly posting tax returns is an idea that's mostly been explored in the context of tax avoidance. The idea is that if the amount of tax the rich and famous pay were made public, "the might be motivated to fill out their taxes correctly", as the New York Times' Anna Bernasek put it in 2010. It ought to be supported by small-statists, too, since the disclosure of the myriad loopholes used by the wealthy to avoid tax would lead to support for a simplified tax system.

But public disclosure of income tax filings also has a role to play in political sphere: that of redistribution – or, to use the Labourite buzzword of the year, predistribution – of wealth.

A TUC pamphlet, published today, looks at how to boost the wage share [pdf]. That's the proportion of GDP which is paid to employees, as opposed to ending up in the pockets of shareholders (or, to a lesser extent, small business owners – official statistics record them as a separate category from shareholders or employees, because they share characteristics with both), and it appears to have seen a permanent drop since the 1970s:

Howard Reed and Stewart Lansley, the authors of the pamphlet, examine a few different ways to counteract that trend, from raising the national minimum wage or boosting take-up of the living wage to extending the role collective bargaining. They argue that could be done through a re-establishment of the Wages Councils, which were empowered to set minimum wages in various industries until John Major's government abolished them in 1994.

But one of the strongest ways to boost the wage share of income is to make it easier for individual employees to negotiate their wages up; and that can be helped greatly by making income tax returns – and thus, incomes – public.

When it comes to negotiating wages, employees are usually at a disadvantage. That's largely because, for all but the smallest companies, being one person short on headcount is much easier for a business to live with than having no job is for a person.

But there's also an information asymmetry. You both know publicly available salaries (for jobs similar to yours which are being advertised), but your employer also has access to a second pool of information: they know what they're paying your co-workers. That's information they can cite when it's in their interest and hide when it's not. Over time, that adds up, to lead to wages lower than they ought to be.

One of the purposes of unions is to overcome this information asymmetry; so in my profession, for example, the NUJ maintains a list of reported rates for freelancers, to help people fight for fair pay. But that's only useful to a certain extent; being able to cite the pay of the person who sits next to you when arguing for a raise is far more useful than being able to cite an average for the industry.

The balance of power within corporations is one of the hardest aspects of our lives for the state to affect, but one where it could do the most good. Publishing income tax records, as is already done in Finland and Norway, could well be a first step on that road.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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New Digital Editor: Serena Kutchinsky

The New Statesman appoints Serena Kutchinsky as Digital Editor.

Serena Kutchinsky is to join the New Statesman as digital editor in September. She will lead the expansion of the New Statesman across a variety of digital platforms.

Serena has over a decade of experience working in digital media and is currently the digital editor of Newsweek Europe. Since she joined the title, traffic to the website has increased by almost 250 per cent. Previously, Serena was the digital editor of Prospect magazine and also the assistant digital editor of the Sunday Times - part of the team which launched the Sunday Times website and tablet editions.

Jason Cowley, New Statesman editor, said: “Serena joins us at a great time for the New Statesman, and, building on the excellent work of recent years, she has just the skills and experience we need to help lead the next stage of our expansion as a print-digital hybrid.”

Serena Kutchinsky said: “I am delighted to be joining the New Statesman team and to have the opportunity to drive forward its digital strategy. The website is already established as the home of free-thinking journalism online in the UK and I look forward to leading our expansion and growing the global readership of this historic title.

In June, the New Statesman website recorded record traffic figures when more than four million unique users read more than 27 million pages. The circulation of the weekly magazine is growing steadily and now stands at 33,400, the highest it has been since the early 1980s.