Wednesday, August 17, 2022

Letters: The Poll Tax again (1989)

Letters to the Editors from the August 1989 issue of the Socialist Standard

The Poll Tax again

Dear Editors,

Your article on the Poll Tax stinks of ignorance. The claim that the working class will not, in effect, be any worse off is a false hope and does not bear truth. How do you explain my situation? I'm unemployed and receive a pittance of £26 a week. The Poll Tax will cost me about £3 a week for starters, which I can't pay, but also my parents are paying the full amount and with rents already rising this means that my board will go up by a fiver. That's £9 a week I'll lose and that's just the beginning! But will my benefits rise, as you claim will happen to wages? No, I don’t think so either. And I'm far from being in a minority.
C. J. Stephen 
Montrose, Tayside


Dear Comrades,

The article on the Poll Tax in the June issue seems misleading. To quote, “any extra charge . . . imposed on workers . . . will tend to be passed on, through the operation of market forces . . . to employers of labour”. You quote a capitalist MP, David Ricardo, in support.

This may have happened in 1819, but it is unlikely that it will apply to the present poll tax. If one's income is increased so does the charge. In the recent rise in retirement pensions, letters were issued, in my case, on 3 May, informing recipients of "a re-assessment to calculate the new rebate entitlement". So it—the Poll Tax—is a sum which can be changed during the year, in contrast to the old rating system.

There are other anomalies. I still don't have the total amount of what I have to pay. The council seem to make up the rules as they go along, leaving it to luckless office girls to explain to any, usually irate, enquirer. With rising prices, the situation becomes worse. Scottish people seem to have been used as guinea pigs!
John Keith 
Huntly, Aberdeenshire


Dear Editors,

I read the June issue of the Socialist Standard with much interest and I found much to agree with in both the articles and the object and declaration of principles of the Socialist Party of Great Britain. However, the article about the Poll Tax ('What about the Poll Tax?') which argued that it is not a working class or socialist issue, I found hard to follow.

You quote David Ricardo as saying that taxes on wages will be passed on to the employers via demands for higher wages. In my view, this is both an optimistic view on the effectiveness of the Trade Union leadership in fighting for higher wages, or even fighting for wages that are in line with inflation, and a negation of the real hardship that will be caused by the Poll Tax for many working class people and the importance for the working class to organise for their own defence—although it could be argued that such a defence could prolong the wage system.

As everyone can see with the present dock strike, the Trade Union leadership is not willing to break laws designed to protect the capitalist system, and what action has taken place has been organised by the dockers themselves. Surely it is this type of organisation, and that against the Poll Tax, that will help bring forward the idea that the working class can organise for themselves outside the capitalist system? Secondly, why should the working class pay a more proportionate amount of their income in tax than the rich?

I hope you will answer these points.
Michael Wadsworth,  
Longsight, Manchester


Reply:
It is true that the editorial on the Poll Tax in our June issue did concentrate on the position of workers in employment. But the position of those not in employment and having their income made up to the poverty line by means-tested benefits is basically the same, except that in their case any increase in their income to compensate for the extra charge represented by the Poll Tax has to come from the government rather than through the operation of market forces aided by trade union action.

Of course, governments being notoriously penny-pinching in this field, this increase, introduced in April last year, will leave many worse off while many of those who existed just above the poverty line will find themselves levelled down to it. But to be squeezed in this way is the eternal fate of "the poor" under capitalism and underlines the urgent need to end the capitalist system which treats people who are useless to its profit-making activities in this way—and would continue to do so even if the Poll Tax were abolished and replaced by some other tax such as Labour's proposed local income and property tax.

We never denied “the real hardship that will be caused by the Poll Tax for many working class people". Our argument was that the way to mitigate this was not to wage a political struggle for the repeal of the Poll Tax but to press on with the struggle on the wages front while campaigning politically for the abolition of the wages system. It might indeed be argued that the defensive wages struggle could prolong the wages system but this is not our position. We say that as long as capitalism lasts workers should struggle to get the best price they can for the sale of their labour power.

We have no wish to defend “the Trade union leadership", but we must point out that the existing trade unions are more effective in the wages struggle than Michael Wadsworth gives them credit for: the figures show that at the moment wages are rising on average faster than the cost of living. Anti-Poll Tax groupings (quite apart from mainly being fronts for the Labour Party and/or various Trotskyist would-be vanguards trying to exploit working class discontent for their own anti-working class political ends) could never be as effective as trade unions or other forms of workplace organisation because they seek to organise workers as consumers and not as producers whereas it is only at the place of work—through strikes and the threat of strikes—that we workers have what little bargaining power we do under capitalism. Besides, a group based solely on fighting for the abolition of the Poll Tax can only divide the working class since it is never going to get the support of those workers who as individuals are going to pay less as Poll Tax than they did as rates. Such workers are to be numbered in millions: according to a special issue of Oxford Green News (Spring 1989) on the Poll Tax, “around 22.5 million people in the UK would be paying more and only 17.5 million paying less". Most of these 17.5 million will be workers, so what are they supposed to do to resist financial hardship? Organise politically to defend the Poll Tax? Some way to unite the working class! Socialists represent the common class interest of all workers and so can never be party to setting one group of workers against another over the crumbs that are available under capitalism.

Although we quoted David Ricardo, we could just as easily have quoted Adam Smith or Karl Marx. Here are a couple of quotations from Marx:
The level of wages expressed, not in terms of money, but in in terms of the means of subsistence necessary to the working man, that is the level of real, not of nominal wages, depends on the relationship between demand and supply. An alteration in the mode of taxation may cause a momentary disturbance, but will not change anything in the long run. (Marx-Engels. Collected Works, Vol 6. 1845-1848. p. 225).

If all taxes which bear on the working class were abolished root and branch, the necessary consequence would be the reduction of wages by the whole amount of taxes which today goes into them. Either the employers' profit would rise as a direct consequence by the same quantity, or else no more than an alteration in the form of tax-collecting would have taken place. Instead of the present system, whereby the capitalist also advances, as part of the wage, the taxes which the worker has to pay, he [the capitalist] would no longer pay them in this roundabout way, but directly to the state.(p. 329).
How does this work in practice? How does an extra charge on workers come to be passed on to employers of labour? First, we are not talking here about an individual extra charge imposed on an individual worker, but about an extra charge that is sufficiently widespread to enter into the average cost of production of labour power. So, a worker is Glasgow who previously paid no rates (because he or she was a "dependent" of someone who did) cannot take their Poll Tax bill for £300 to their employer and ask him to pay it. If, on the other hand, a majority of workers suddenly had to pay an extra £300 over and above what they had been paying, say in rates, towards the financing of local government then things would be different. The same sort of pressures would be generated for wages to rise as operate as a result of the fall in the purchasing power of money due to inflation: because their living standard would have fallen, workers would be more motivated to struggle for higher wages; once one group of workers had obtained an increase (through being better organised, through their employer having a full order book and not wanting the flow of profits to be interrupted, etc), then other employers are forced to follow suit to attract or retain workers.

The Poll Tax, however, is not a completely new charge on workers; it is a different charge, a different way of financing local government, replacing the rates. Since the rates—whether paid directly by those owning or buying their homes or indirectly as part of the rent paid by those in rented accommodation—have been long-established they will have become an element in the cost of living of wage and salary workers, so that existing wage rates will already reflect the average charge they represent. This means that the introduction of the Poll Tax will only exert an upward pressure on wages to the extent that the average Poll Tax charge turns out to be substantially higher than the previously- existing average Rates charge. For the time being, in fact, the Poll Tax. seems to be more of a redistribution of the charge for local government finance amongst workers with some paying less and some paying more than previously—in other words, a “redistribution of poverty" within the working class—than an extra charge that will tend to be passed on to employers. However this may change when the increases programmed in the Poll Tax for the coming years come into operation.
Editors

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