Saturday, September 17, 2011

Oh, you think?

The boy Clegg seriously doesn't appear to get it, he's the junior partner in a coalition government and still appears to be attempting to be the tail that wags the dog..

Scrap the 50p rate and we’ll drive through a mansion tax, says Clegg
Owners of “high-value” houses will be made to pay more tax, Nick Clegg has said. 
The Deputy Prime Minister also insisted yesterday that the Liberal Democrats’ plans to cut taxes for low-paid workers must come before Tory moves to ease the tax burden on “people at the very top”. George Osborne, the Chancellor, has suggested that the 50p tax rate is “economically inefficient” and senior Tories want to abolish the higher rate as soon as next year.
However, Lib Dem ministers are arguing that if the 50p rate of tax is scrapped, another tax on owners of expensive homes must be introduced to replace the revenues the Treasury would lose.
The Treasury is expecting to take in £3 billion from the 50p tax this year, and £2.6 billion next year. Under the Lib Dem’s so-called “mansion tax” plan, revenue lost by reducing the 50p rate – perhaps to 45p – would be recouped by imposing higher taxes on property owners.
The Lib Dems still haven't really got to grips with Laffer Curve economics or the law of diminishing returns as yet, I somehow doubt they ever will. Essentially it's to do with ever higher taxes and the proven fact that the higher they go, they reach a point where what the government takes in actually becomes less as those who are being taxed simply up and leave. So unless the Lib Dems are proposing to stop emigration then keeping taxes high or proposing to hit those with big houses wont work. People will simply up and leave and the burden of raising taxation will fall again on those at the bottom of the scale.
What the government should be doing is lowering taxes to encourage businesses to set up here, employ people and take them from the unemployed or public civil services. And chain saw back the state and costly legislation like the Equalities Act, the Human Rights Act and various other restrictive policies such as offering translation services for all and sundry. They should call a moratorium on immigration too and set up a "green card" system of work permits, only the people we need will be permitted entry. We should leave the costly and over regulated EU and apply to join EFTA become a trading nation with everyone with no costly import/export tariffs, the EU will still want to sell us stuff after all.
If you lower taxation, you increase peoples and companies spending power, you create real jobs, you make it worthwhile working at the lower end of the scale. You raise taxes, people leave.

1 annotations:

Anonymous said...

But they don't want a sensible solution, do they?