McDonnell calls for windfall tax ahead of budget

Ahead of the Government’s budget on March 3, Hayes and Harlington MP John McDonnell has laid out an agenda to tackle the problem of increasing household debt, caused throughout the pandemic.

As highlighted by Citizen’s Advice, around 6 million people in the UK have fallen behind on their bills over the past year. Further, the number of people experiencing severe problem debt has doubled to 1.2 million.

Writing in the Independent this week, McDonnell, who served as the Labour Party's Shadow Chancellor 2015-20, laid out an agenda to deal with the causes and consequences of debt.

To prevent people getting into debt in the first place, McDonnell called for a £10-an-hour living wage, improved benefits, and the restoration of universal basic services.

Further, to “rebalance power between lenders and the indebted”, he called for a cap on interest rate charges and a ceiling on overdraft fees and interest payments.

To tackle the burden of debt accumulated over the last year, McDonnell called for a “comprehensive package of debt cancellation” paid for by “a windfall tax on those that have profited from the pandemic.”

He said that the financial problems caused by the pandemic have left many Britons facing “a long trail of hardship, poverty and unmanageable personal debt unwinding”

“Debt is an issue neglected by politicians for too long,” wrote McDonnell. “The time for action has come.”

Cover Photo Credit: Socialist Appeal. Licensed under CC BY 2.0