Economic Outlook: Cut tax to make UK a magnet for the world

[centurian]

At least it will dent the Uk Uncut arguments - the amount of corp tax avoided will be lower if the tax rate is much lower

[doodab]

They should cut income tax for those on low and middle incomes.

A more competitive (i.e. cheaper to employ) labour force will stimulate investment, It will also put more money in the consumers pocket stimulating the overall economy, and increase the benefits of working encouraging people off benefits.

They also need to encourage entrepreneurship by getting rid of some red tape and simplifying the tax system. Someone has to grasp the nettle sooner or later.

Lets face it we've spent ten years tuning the tax system on behalf of large corporations and the already rich in the hope it will "trickle down" and what we've seen an unprecedented transfer of wealth in the other direction. It's time to try something else.

[scooterscot]

doodab for PM!

[Freamon]

They should cut income tax for those on low and middle incomes.

A more competitive (i.e. cheaper to employ) labour force will stimulate investment, It will also put more money in the consumers pocket stimulating the overall economy, and increase the benefits of working encouraging people off benefits.

They also need to encourage entrepreneurship by getting rid of some red tape and simplifying the tax system. Someone has to grasp the nettle sooner or later.

Lets face it we've spent ten years tuning the tax system on behalf of large corporations and the already rich in the hope it will "trickle down" and what we've seen an unprecedented transfer of wealth in the other direction. It's time to try something else.

That's all very well, but how to pay for it?

[doodab]

That's all very well, but how to pay for it?

You could argue that It'll pay for itself. You'll take less in income tax but more in VAT, excise duty and corporation tax as people spend the money, and as the economy starts growing the overall tax take will grow with it. 35% of £1.7 trillion is actually a bit more than 37% of £1.6 trillion. It would also reduce the number of people on benefits and reduce the amount of benefits due to those on them, according to the ONS working tax credits

You could also look at tweaking some consumption taxes e.g. increase duty on wine & spirits, which in terms of net contribution to the Exchequer has almost halved in real terms in the last 30 years.

Edit: I can't believe no one has made a game of this. I mean a proper one where you play economics and politics on a global scale against other players. I suppose civilisation is close.

[DodgyAgent]

That's all very well, but how to pay for it?

Easy,

Spend money on education reducing class sizes, making teachers accountable, giving parental choice and therefore giving control over to the consumer not the supplier. Improve sports facilities and link teaching of sports with clubs. let the schools be run privately.

Gradually reduce and eventually remove welfare benefits

The outcome is removal of the crippling cost of the welfare state, a workforce empowered and educated enough to work. The reduced need for police forces, prisons, social services and all the other government departments and Quangos that go towards patching up the tulip that they deliver in the first place.

Remove the state from having any functional provision of services and act purely as a controller of businesses - breaking up monopolies for example. create a second tier business system that enables provision of certain services (elderly care) to be delivered under say a cooperative system/model such as Waitrose.

Make all unemployed earn their benefits by cleaning graffiti and litter or answering phones.

The public sector workers newly unemployed can start at the beginning by going to east Anglia and picking fruit instead thus replacing all the immigrants. lots of investment in training (difference between an apple and a pear!)

Bring back the workhouses where the poor can work and look after each others kids, with good education, sport, healthcare.

Incentivise business creators by reducing rates, reducing taxes of the lower paid, remove corporation tax completely.

Here endeth the lesson

[amcdonald]

What they should do first is cut down on all the benefits they dole out, and up the personal allowance to a level you can actually live on

Scrap working tax credits completely, and don't tax the poor in the first place it's just social engineering to create an underclass dependant on the state

A flat rate tax system should come next, if they EU complain or fine us ignore them or leave entirely why should be belong to some ghastly Franco German system that will only ever benefit them

[Freamon]

You could argue that It'll pay for itself. You'll take less in income tax but more in VAT, excise duty and corporation tax as people spend the money, and as the economy starts growing the overall tax take will grow with it. 35% of £1.7 trillion is actually a bit more than 37% of £1.6 trillion. It would also reduce the number of people on benefits and reduce the amount of benefits due to those on them, according to the ONS working tax credits

You could also look at tweaking some consumption taxes e.g. increase duty on wine & spirits, which in terms of net contribution to the Exchequer has almost halved in real terms in the last 30 years.

Edit: I can't believe no one has made a game of this. I mean a proper one where you play economics and politics on a global scale against other players. I suppose civilisation is close.

Spending money to try and "stimulate growth" is a bit of a gamble though, and hasn't always paid off in the past. Japan has been trying to do this for years, but it turned out that actually people just used the extra money to pay down debt and build up savings. Given the level of personal indebtedness in the UK, and the fact that the population is starting to wake up and see that spend spend spend isn't always a great idea, there's no guarantee the gamble will pay off.

[Freamon]

Easy,

Spend money on education reducing class sizes, making teachers accountable, giving parental choice and therefore giving control over to the consumer not the supplier. Improve sports facilities and link teaching of sports with clubs. let the schools be run privately.

Sounds great, but also very expensive. I would argue that schools and teachers are already pretty good, and throwing vast sums of cash at them won't necessarily make them any better. The main reason certain groups of kids don't succeed at school is their home environment and parenting, not the school.

Easy,
Gradually reduce and eventually remove welfare benefits

Next time I'm unemployed I'll be robbing your house then. Hopefully in the process I won't injure you such that you can't work, because if I do, you won't be getting any disability benefits so you'll probably just starve. On the plus side, undertakers would get a nice boost to their incomes.

The outcome is removal of the crippling cost of the welfare state, a workforce empowered and educated enough to work. The reduced need for police forces, prisons, social services and all the other government departments and Quangos that go towards patching up the tulip that they deliver in the first place.

Remove the state from having any functional provision of services and act purely as a controller of businesses - breaking up monopolies for example. create a second tier business system that enables provision of certain services (elderly care) to be delivered under say a cooperative system/model such as Waitrose.

So the state shouldn't provide any services at all? Privatisation of railways, water and energy supplies has been such a roaring success hasn't it...

Make all unemployed earn their benefits by cleaning graffiti and litter or answering phones.

Paying NI whilst they're working isn't enough I suppose.

The public sector workers newly unemployed can start at the beginning by going to east Anglia and picking fruit instead thus replacing all the immigrants. lots of investment in training (difference between an apple and a pear!)

I'm not sure there's enough fruit in East Anglia to keep them all busy.

Bring back the workhouses where the poor can work and look after each others kids, with good education, sport, healthcare.

You think a state run manufacturer would be able to compete with the chinese, when the workers are compelled to work there rather than choosing to? Sounds like an amusing way to burn vast sums of money for no benefit to me. Not sure when "the poor" will look for real jobs in this scheme, either.

Incentivise business creators by reducing rates, reducing taxes of the lower paid, remove corporation tax completely.

A plan that's worked extremely well for Ireland.

[DimPrawn]

Even more oddly both those countries tax their citizens less!!!

What about NI, CGT, VAT, stamp duty, fuel duty, alcohol duty, inheritance tax, council tax, carbon tax, road tax, etc etc etc.

I reckon we are global leaders in heavy taxation. Unless you are a Non Dom and pay £50K pa flat rate.