The society said it was launching a commission on ‘taxation and citizenship’ to stimulate public debate ahead of the next election. Labour peer Lord Plant, chairman of the 15-strong commission, said it would ‘examine the principles which should govern a modern tax system, and will make proposals for reform’.
Michael Jacobs, general secretary of the Fabian Society, said: ‘The legacy of the Thatcher years has made taxation almost a taboo subject in UK politics.
It is time for a new public debate about the purpose of taxation and its central role in funding public services.’
The move was seen by some as an attempt to prepare the ground for rises in direct taxation after the next election. But the commission will also examine ‘the balance between individual and corporate taxation’, leading to fears that businesses could be targeted.
Neil Chisman, finance director of hotels group Stakis, said a review examining the tax system would be useful if it led to a simplification of the rules.
Gordon Slater, head of taxation at Cadbury Schweppes, agreed, saying it should examine how EU harmonisation of rules for assessing taxable income would affect business: ‘It is bound to come, it is just a question of whether it happens by accident or by design.’