‘No one I have spoken to can think of a precedent for a government seeking to thwart a request for evidence from an official inquiry that the government itself set up.’
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Should just make a flat 12% tax on everything. No tax deductions, no exceptions. Make it ultra simple.
Any transaction made in the UK is subject to the same tax. Don’t care if charity, school. self employed or interest on your bank account.
The only reason there are loop holes is because people create them to make exceptions.
You would save billions reducing complexity of HMRC. It would make it far easier to determine if someone has commited fraud.
You’d still find people trying to work their way around paying it.
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That would push a lot of people into poverty.
Correct but I wonder if lifting wages to compensate would work?
There’s an obvious saving on vat if that’s included.
Doesn’t encourage green policies either I suppose.
The capacity of a trade-oriented economy to simply lift wages is rather limited. Such an economy either needs to see productivity growth or a different distribution of income, or some combination of the two. One of the effects that Brexit has added is somewhat perverse. The UK economy is now less integrated with European trading partners, but more trade-exposed globally - which means more direct exposure to lower wage trading partners. UK labour productivity has been stubbornly flat since circa 2008, so the net pressure on UK real wages is distinctly downward. Given that wages are distinctly ‘sticky’ and nominal wages have not come downward, there is a significant upward pressure on inflation. But there is very little the UK can do about that except with monetary policy, the UK’s trading partners are going to continue to price goods +/- at the global rate.
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They won’t even give a 1% pay rise, the companies would go on strike if they had to fork out a 12% payrise.
The thing is increasing bottom earners wages would get rid of so many of capitalisms problems yet instead we get austerity, massive payrises for the ‘rich’ just to keep the cycle of shit going round!
… and there you have it!
Of course, that is not that easy to achieve, particularly with globally-mobile capital. The UK in particular reaps enormous benefits from being a major capital market, which requires that mobility.
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Well I think it should be easy, instead of giving 60% wage increases to the bosses give 5% wage increases to the workers to even things up!
Oddly, a lot of bosses seem to feel otherwise
Which is why they should be taxed more heavily.
That’s the whole point about trade-exposed capital. If you increase taxes in the UK, a lot of that capital just leaves - much more so than France or Germany, because a lot of it is in the UK for precisely that low tax reason. Brexit simply accentuated that. Increase the taxes on head offices, head offices relocate. The UK is in something of a policy trap.
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So it’s settled then, more austerity, more money for the rich, lower taxes for the rich leaving the masses to die off slowly!
In other words Truss was correct it just shouldn’t have been her!
@Klopptomist is probably correct about the Tories winning the next election, though his reasons might be wrong, as as soon as they start their scaremongering campaign that Labour might give that old witch of a granny a few more pennies to lose and that would sink the country everyone will come to their senses!
Laughing aside, that is sort of the policy trap. In the near term, any effort to reduce income inequality is going to have a quick effect/cost in terms of total economic output. The UK being more dependent on globally-mobile financial capital would see this effect faster than most other European economies. Any benefit is going to take longer to occur. A government that takes a step in this direction is almost certain to make most people worse off fairly quickly. Democratic governments are often not particularly good at facing up to that kind of challenge, the calculation would necessarily be whether or not any benefits would arrive soon enough to enough people to survive past the electoral cycle. It is the political equivalent of the ‘quarterly result’ reporting problem with publicly traded companies.
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Well given my post was in response to a hypothetical scenario of a flat tax rate I don’t see the problem with extending that little debate with what would need to happen to make it a balanced policy.
So perhaps you should think again about what you choose to laugh about?
Yep, agree with this.
I’d be over the fucking moon with that
Of course, you would need to cut somewhere around 2/3rds to 3/4s of government activity/spending were you to have that flat tax rate across all activity. There would be a revenue gain from those who have successfully managed to keep their taxation percentage below that despite enormous wealth, but it is fantasy to think it could make up for the massive shortfall from the people who currently really pay the bills. The point 2/3rds to 3/4ths range would be determined essentially by how large you believe that gain from the wealthy to be. If you generously assume the low of a 2/3rds cut, you would face some tough choices.
Of the 33% or so you would be able to spend against current percentage, you would really only be working with 28%, because 5% of all expenditure is debt interest. Fail to cover that, and you enter a very different territory.
You’d probably have to start with a 50% cut to welfare, education, health care and pension spending, then get really tough in the other areas.
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