Tax and spend

What I said to The Sunday Telegraph was if Labour wanted to get back to their budget plans they had to stop spending money like water and cut out waste and less desirable spending. They are going to need an emergency package to put right all the damage they are doing by wasting and borrowing too much, and to cut taxes like Stamp Duty and VED which they raised too high.
I think George Osborne has been exactly right to refuse to offer us the 2010 or 2011 budget in advance, given the huge Labour black hole already apparent in the figures. THe likely development is an even bigger black hole in the government’s figures, given the way they are spending.

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9 Comments

  1. Matthew Reynolds
    Posted August 24, 2008 at 12:16 pm | Permalink

    Well John here we are again – time to cut tax & spend ! I struggle on just over £12,000 p/a and do not get tax credits as obviously I live at home as renting etc is out of the question . I have a student debt of roughly £11,000 and prices having gone up has been a major pain and it is a challenge to keep the bank account in surplus what with the credit crunch . The governments £120 in September 2008 – March 2009 is obviously a help after I was hit by the end of the 10p band and changes to pension fund tax relief . Will Tory MP's on five times what I earn wake up & smell the coffee as Frank Field , Denis MacShane and Nick Clegg all want cuts in taxes & public spending such a policy will not offend swing voters in marginal seats but will revive the economy as Lord Forsyth suggests ? You cannot share the proceeds of growth if it is 0% ! For reasons of economic liberalism and social liberalism (i.e. boosting productivity & social mobility ) offering a big rise in the basic personal allowance funded by virtue of cutting down on QUANGO's , civil service numbers , consultancies and government procurement costs would make sense . It is immoral & insane to tax people into poverty so that they are trapped in it with complex credits that punish self-improvement and cost a bomb to administer . You Tories can be a radical one nation Party by pledging smaller government to cut taxes for everyone in a way that favours the least well off . That sounds a lovely alternative to Gordon Browns mess !

  2. Johnny Norfolk
    Posted August 24, 2008 at 4:23 pm | Permalink

    Its for Labour to tell us what thery intend to do for the next 2 years and the Conservatives what they will do in the run up to the next general election in their manifesto and not the other way round. Labour should stop trying to hide behind the Tories and start to reduce spending and cut taxes. What they will do of course is to borrow more. The real world and labour do not go together.

  3. Harry Randall
    Posted August 24, 2008 at 5:10 pm | Permalink

    TOTALLY AGREE JOHN REF. TAXATION

    Harry & Jean here in West Dorset

  4. mikestallard
    Posted August 24, 2008 at 7:09 pm | Permalink

    Excellent for making the first paragraph of the Front Page of the First Post – as well as the Sunday Telegraph – to say something so important as you did! Well done indeed!

    Wasn't it you who noticed that, when questioned, Yvette Cooper looked at the floor when you mentioned the debt of £1.3 trillion debt?
    That is almost exactly double the government's annual gross income.

    The figure which I would like to know, truthfully, is exactly how much tax is not being paid when it ought to be. The government website blithely quotes the USA shortfall as 14% and says that the British deficit is much smaller than that. It would be nice to know the exact figure.
    And inflation, too, by the way, is , apparently, well under 5%……..

  5. Graham Eardley
    Posted August 24, 2008 at 10:24 pm | Permalink

    But the only economic theory that Labour understands is that of Keynesian economics.

    Hence the more of a mess the country is in the more they will spend !

    They seem to reject Monetarism out of hand.

    Also the Government seem to of forgotten the amount of money they have to give to the European Union to remain in membership of such a wasteful organisation.

  6. John
    Posted August 25, 2008 at 11:16 am | Permalink

    While you are on the subject of waste, how do you feel about the contention that all asylum seekers in this country are illegal.
    They all have to pass through or over other states to get here, thus negating the rule that they should apply for asylum to the first state they come to. The support of many of these people is costing a vast amount, and I think it is a waste.

    Reply: Not all asylum seekers are illegal, but I agree we should enforce fair rules and have sensible arrangements with neighbouring states to help us control our borders.

  7. Acorn
    Posted August 25, 2008 at 12:12 pm | Permalink

    I read a blog sometime back, about a gunner on a US army chopper in Vietnam. He reckoned he could "smell fear" when a bunch of grunts piled into his chopper and were heading off into the jungle.

    Well, I am smelling fear whenever a Treasury or Bank of England so called "expert" is heard or seen in the media. To coin a phrase, "things are worse than advertised". Unfortunately, our financial reporters are not up to the job and appear not to know enough to ask the questions that need answering. Stuff like, just how big is the total credit market debt in the UK. How much in Treasury bonds are being issued every month and is it accelerating exponentially. How much new paper money is being printed each month by the BoE and subsequently devaluing the little bit I have in my bank.

    Tinkering with VED and Stamp Duty John is like having a pissing contest on top of a mountain. Everyone is forgetting how high the mountain is; and, at some stage we have to get down the mountain before we all freeze to death, and leave the kids destitute with the bills we left them.

    Reply: I agree the government needs to curb spending to control the build up of debt.It's running at around £50 billion extra this year or more – we can't get accurate figures yet from HMT – some say as high as £60 billion a year

  8. E.C.Forster
    Posted August 25, 2008 at 12:54 pm | Permalink

    One thing that needs to be done is to refute the idea that taxing higher earners helps the poor. This is the central plank of socialism. It is wrong.

    Taxation of the economy implies a tax on consumption. Any tax on the productive sector, including employees, has to be an eventual cost to consumers. Everyone is a consumer. Everyone, including those who don't think they pay any tax, actually pay tax when they spend. Higher earners spend more, thus pay more tax. That is the full extent of progressive taxation. Income taxes and taxes on business completely mislead voters about where the real burden of taxation falls.

    See the proof: http://ecforster.netfirms.com/Tax/Doc1.html

    The consumer is the ultimate taxpayer.

  9. STAN FRANCIS
    Posted August 26, 2008 at 8:27 am | Permalink

    Your piece ysterday Sunday in some newspaper:

    Waste of taxpayers money must be at the top of any chancellors list before any cuts are made in public services.

    Cut the waste and you will find £Billions, the public could assist you with what they find out through the media, but what's needed here is whistle blowers with the first hand information needed.

    What we need is to stop the obvious drain of our money and rights which is the EU…but Cameron won't have anything said against it apart from rectification of the Lisbon treaty.

    Stewart Wheeler seems the only guy that wants forward on this subject and wish him the best of luck!

    We heard last week that Hopwood village in Worcestershire is about to get 20 new houses built against all advise, mai advise is on marshland, but the EU have said it will happen….Brown says be British, how can we be when we are administered by foreign countries.

    At the games he said be GB British, the BRITISH FLAG will be at the 2012 olympics, no it won't, for the EU want there flag there instead and will we hear happen…what's gone wrong John with this country, how can so few have so much effect on the masses, have we the public not watched the signs when we should have or is it just a rich man's world now and we are just the milch cows with no future of belonging anywhere AND AS thorneycroft once said, they couldn't handle the truth?……(Piece shortened as became a rant along the same lines-ed)

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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