I have heard rumour that the Treasury is working hard on possible tax reforms.
The rumour suggests that the 'postponed' cut in the corporation tax rate is no longer postponed: that lasted as long as the election campaign.
But the logic of fiscal neutrality will, apparently survive, so the billions that cutting corporation tax will cost will have to be found. And rumour suggests that VAT may well be what is being looked at.
Johnson did, however, say there would be no increase in VAT, income tax or NIC on his watch. It's a bit early to break that commitment. So what might be done? I suggest that the exemptions, allowances and reliefs are up for grabs.
The allowances look like this:
Exceptions apply to domestic rents, private education, private medicine, funerals and some other more minor areas, none of which look as though they would appeal to Tories.
So where will the £6 billion of funding for the NHS that postponing the corporation tax cut supposedly provided come from?
Watch out for books and newspapers, children's clothes, an increase in the VAT on domestic fuel and power (a green measure, it will be called) and the addition of VAT at the same rate as fuel on water, I suggest.
I would not expect a move on food, as yet.
I stress, this is all a rumour. But it would completely fit Tory logic. And it is, of course deeply regressive. Which also completely fits Tory logic.
Nothing should be ruled out at present.
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‪No. Further Corp Tax rate cuts limited benefit; Conservative’s Brexit promise to take back control of VAT rates didn’t mean put them up!‬
My rumour monger may be wrong, but I don’t think the Treasury is seeing things your way
I would hope, in the spirit of cutting complexity, some of the more useless tax reliefs would go first
So would I
And Entrepreneur’s relief will
But that won’t be enough
I can hear Andrew Carnegie turning in his grave anyway at the closing of libraries up and down the land. To add to that making it harder for people to afford to buy books!!
Books and reading enrich our lives so much.
Keeping the hoi poloi ignorant and miserable seems to be the aim.
The Donald gave beautiful tax cuts to corporations and the wealth creators and now ‘merica is powering ahead. What’s not love said the man in the trailer park.
The American Dream lives on and we can have that too.
The cheque’s in the post
my dog doesn’t bite
and, the rude one liners…
Prentii,
Like this: https://www.vox.com/2018/8/2/17639762/stock-buybacks-tax-cuts-trump-republicans
There is a difference, though, in that The Donald does not care about deficits (neither it seems do most Republicans unless they are Democratic deficits). So his trillion dollar tax cut has simply gone onto the overdraft at the Fed. I suspect Boris does not care about deficits either so long as it is not his personal money, but maybe the neo-liberal orthodoxy in the Treasury is strong enough to force him to ‘balance the budget’.
I do expect a lot of extra spending in the budget. I think Boris will be happy to spend whatever it takes to keep Boris in power (unless and until he gets bored with being PM).
11 March is going to be very interesting
I will be commenting on Radio 2
It may be quite a challenge!
“I suspect Boris does not care about deficits either so long as it is not his personal money”
Despite what people think, Tories run bigger deficits than Labour.
Gotta buy off the non-productive voters!
As my research has proved
The Tories have never really cared about the deficit at all They used it justify the assault on public expenditure through welfare cuts and reductions in public services where local government, amongst others, have faced the fiercest reductions with the discernible reduction in the quality of life, increased crime and the increased stresses of providing those services with the gradual diminishing of capacity. Meanwhile tax cuts to wealthy individuals and corporations have diverted financial resources away from these who need it most. The result; a record increase in the national debt, the worst recovery from a recession in 200 years, with a trend level of growth after 10 years, climate change accepted, well below that of many previous governments.
Crime figures have been released today that show another increase with the government now saying that the proposed increase in police numbers will cause a reduction in those figures, ERGO, a reduction in numbers that have occurred under this bunch would therefore have caused an increase.
I despair.
“And it is, of course deeply regressive. Which also completely fits Tory logic.”
Yup, the Tories are the only party to have introduced and steadily hiked thus most regressive and damaging of taxes.
[…] Source:Â taxresearch.org.uk […]
Er, in a so called democracy the electorate get the government they deserve. Remember a lot of ‘working class’ voted conservative (it should be noted that the UK is far from a democracy, you only need to look at the % that actually voted conservative to realise that their comments about a mandate from the people is just wishful thinking on their part. We all had the chance to change this a few years ago but the electorate, who are always right decided to keep the status quo). You didn’t vote conservative? Well, blame those in your street that did. Don’t blame the government, Boris or any one else in power, put the blame where it really belongs.
I hope you’re being ironic….
Would it be ridiculous of me to ask the question has Trump (ironically) implemented a bit of MMT, albeit by a rather perverse trajectory, and subsequently derived political benefit accordingly? Sure the deficit (in the US financial economy) has balooned but more people are fully employed in the real economy and so, as ‘trailer-park’ man says, what’s not to love?
So if Johnson apes his mentor and follows the same formula, might the Conservatives reap similar long term benefits? If Dominic Cummings (who is clearly a sharp operator ) picks up on this, perhaps the future is theirs for the taking? Eat your heart out John McDonnell