THE Covid-19 crisis is, of course, unprecedented in the scale of its economic and social disruption. Yet much of the unequal impact of the pandemic is because it is operating in a world in which half of global wealth belongs to the richest 1 per cent and in which global and regional inequalities are defined by racial, gender and class oppression.

Whilst billionaires increase their wealth and self-isolate on luxury yachts, workers in Leicester and across the world are forced to put themselves at risk in order to pay the bills.

We know that, as we rebuild from this crisis, we cannot sustain our fundamentally unequal social order. I believe that a wealth tax is crucial if we are to transition towards a fairer society.

Wealth inequality in Britain is even greater than income inequality, with the richest 10 per cent of households owning 40 per cent of all household wealth. Unlike income, wealth keeps growing automatically and exponentially because it is held in investments that generate even more wealth.

Wealth is also passed from generation to generation, and this dynastic aspect also magnifies existing race and gender disparities.

A recent study by Professor Richard Murphy found that, over a recent seven-year period, income was being taxed at almost 10 times the rate of wealth. Income had been taxed on average at 29.4 per cent while wealth — generated mostly from rising house prices and the increased value of personal pensions — had been taxed at 3.4 per cent.

This means that our overall tax system is incredibly regressive. Whilst gains from rising wealth are near-exclusively concentrated amongst high earners, universal taxes such as council tax, VAT, the BBC licence fee and duties on alcohol and tobacco are disproportionately felt by poorer households.

Professor Murphy concluded that the effective tax rate for the wealthiest 10 per cent of the population — once income and wealth were combined — was 18 per cent, less than half the 42 per cent effective tax rate for the bottom 10 per cent.

The aphorism “the rich get richer and the poor get poorer” has become something of a cliche. Yet comparing wealth and income tax reveals the underlying truth behind this saying.

The most recent Wealth and Asset Survey found that, between 2016 and 2018, the wealth among the richest 10 per cent of households increased almost four times faster than those of the poorest 10 per cent.

A study by the Office for National Statistics also found that the poorest 10 per cent of households had debts three times greater than their assets compared with the richest 10 per cent who amassed a wealth pile 35 times larger than their total debts.

The cumulative effect of this is that the richest 10 per cent hold 45 per cent of national wealth, with the poorest 10th holding just 2 per cent. This is an unacceptable distribution of our national resources.

Our government is in effect subsidising the obscene inequalities that exist in our country. Indeed, research by Tax Justice UK found that the government is giving some of the wealthiest families in Britain up to £666 million a year in generous inheritance tax reliefs on land and business property. In 2016, just 51 families shared a £327m tax break — which worked out at roughly £6.4m for each person.

A YouGov poll found that 69 per cent of the public agree that income from wealth should be taxed at least as much as income from work. But our billionaire-owned right-wing press consistently portrays a wealth tax as an unacceptable affront to enterprise and freedom.

This is despite mainstream economists, such as Thomas Piketty, persuasively arguing for the direct taxation of wealth as a policy tool for redressing inequality.

It is obscene that, in the sixth richest country in the world, vast amounts of wealth are hoarded away while 14 million British residents live in poverty.

The crises we face require radical solutions. We stand on a precipice, in which the crises of climate breakdown, rampant racial inequality and the shockingly uneven distribution of resources seem irreversible.

Not only is it morally right for wealth to be taxed at the same rate as income, but the government also has the potential to raise up to £174 billion a year by doing so. This kind of spending power is crucial if we are to recover from the coronavirus pandemic, economic recession, rebuild our public infrastructure after 10 years of austerity and urgently transition to a green economy.

In 1974, a Labour government came to power which was committed to introducing an annual wealth tax. Sadly, we left office without doing so. Yet our 2019 manifesto pledged to end the unfairness that sees income from wealth taxed at lower rates than income from work by raising the capital gains tax.

Redressing our illogical, regressive system of tax must remain a central goal of Labour’s policy as we organise to build a fairer world.

Claudia Webbe MP is the Member of Parliament for Leicester East — follow her at www.facebook.com/claudiaforLE and www.twitter.com/ClaudiaWebbe.