Tax cuts for all – Let’s make work pay

 

I support tax cuts. The UK is overtaxed. Too much tax holds back work and effort, restricts enterprise and puts off saving and investment.

In the last Parliament many MPs were looking for new ways to tax, or wanting to put up the rates of existing taxes. Today in the election the Liberal Democrat and Labour parties advance two dangerous arguments. They first reckon that the UK is still undertaxed, and want to see more tax on property, on incomes and on effort. The second is they think that higher rates of some taxes will raise more revenue, when experience shows it may well lead to a drop in revenue.

I argued against raising Capital Gains Tax to the 40% the Liberal Democrats wanted in 2010. I helped secure a compromise, at 28%. This was still well up on Labour’s very sensible 18% rate. As I feared, it was too high and it has led to a major loss of revenue compared to the money collected at 18% prior to the financial crisis. I want to see this tax rate back down to say 20%, just a little above Labour’s 18% rate. The state will raise  a lot more revenue from it at such a rate.

I argued against raising the top rate of Income Tax to 50%, as that was bound to lead to a loss of revenue. On this occasion the Liberal Democrats prevailed for a bit, and the state suffered as less  tax was collected from the highest earners. Once a Conservative Chancellor insisted on cutting the rate to 45%, tax revenue went up from top earners. I want to see this rate back down to the 40% Labour used to impose.

I do not wish to see any so called Mansion Tax imposed. Tax cuts for all will boost the economy and lead to an increase in revenue as the country gets richer on the back of lower tax rates.

JOHN REDWOOD    SPEAKING FOR WOKINGHAM    SPEAKING FOR ENGLAND

 

Published and promoted by  Thomas Puddy for John Redwood, both of 30 Rose Street Wokingham RG40 1XU

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5 Comments

  1. Narrow Shoulders
    Posted April 1, 2015 at 7:12 am | Permalink

    39%. Plus employers NI.

    That is the overall percentage of my PAYE earnings your government took from me in the last financial year. All the while welcoming workers from outside the UK to come and recieve in work benefits which subsidise business. That is not a low tax policy as far as I can see.

    More of the same, that is what is on offer in this election.

  2. lojolondon
    Posted April 1, 2015 at 10:25 am | Permalink

    39%. Plus NI. Plus Employers contribution NI. Plus 20% Vat on almost everything except interest. Plus additional tax on cigarettes, alcohol, fuel, insurance, TV tax, energy bills, Inheritance tax, etc., etc.
    PLUS the very underhand tax that is imposed with franchises like when Virgin Rail ‘buys’ a franchise from the government to run a railway line for £ 4 Billion. We all know that that nice Mr Branson is not going to lose that £4 Billion, so he has to recover it over the next 10 years, plus interest, plus running costs of a rail business, plus profits. So, far from regulating rail fares, the government becomes a co-conspirator in raising the railfares, because the more profitable Virgin is, the more the Govt. can demand for the franchise in 2025. So in my books, the government is using Virgin to collect tax on their behalf.
    Nonwithstanding the comically low headline ‘base rate’, I seriously doubt that there is a more highly taxed nation in the world!

  3. Nick
    Posted April 1, 2015 at 10:55 am | Permalink

    On election promises.

    You promised to publish the amount owed for the state pensions, civil and state.

    The only figure available is for the end of Labour. There’s no figure for how well you did managing other people’s money.

    Why have you failed to publish a value for how much you owe for the billions people have given you?

    [Here’s some hints.

    It’s over 9,000 bn pounds, more than total UK wealth. There’s another 1,415 bn borrowing. PFI. Nuclear Clean up. … Never going to be paid.

    400K per tax payer who earns 26.5K [median wage]. Never going to be paid.

    Annual rate of increase. 636 bn. 736 bn including the deficit. You’re spending 730 bn. You would need 90% taxation just to stand still. Not going to happen.

    So its clear. The ponzi game is up.

    But you wont’ tell people by publishing what’s owed

    That’s particularly worrying because it shows you are not acting in the interests of the public, but in the interests of politicians.

    Reply Yes, I did publish the debt figures on several occasions – more importantly so did the government. Total state debt was last seen at £2.23tn on these pages (of which £1.5tn is the conventional debt figure of money owed in bonds etc and the one usually referred to as the state debt). ONS said the pensions liabilities came to another £5tn if you capitalise the future costs of the state pension (main cost) and the unfunded civil service pension liabilities. As we have discussed many times here the State retirement scheme was never planned to be funded, and we do not calculate the positive value of future tax revenues which is of course the offset for the costs of pensions. If you calculate both sides of the balance sheet it would be self cancelling on a sustainable pay as you go basis, which has worked fine so far.

  4. Matt
    Posted April 1, 2015 at 7:18 pm | Permalink

    didn’t the current government raise VAT as soon as it came to power? Any chance of that being reduced soon in the next parliament?

    • petermartin2001
      Posted April 5, 2015 at 1:14 am | Permalink

      I’d say not.

      VAT is the exception to rule as far as the modern day Conservative Party is concerned. That’s a good tax. Whereas income taxes, inheritance duties, petrol duties, carbon taxes, corporation taxes and capital gains taxes are bad taxes.

      Why is that? JR could explain better than I can.

      Reply All in moderation. Putting VAT up to 2% increased the revenue. Putting Income Tax up lost revenue. NOw let’s have some tax cuts

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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