This year according to the Treasury figures every man, woman and child on average will pay £9,700 in tax. That means many of you reading this will pay more than £9,700, as children do not of course pay tax. People on low incomes or benefits rightly pay less.
The government will spend £11,600 on average on every man, woman and child in the country. The elderly and the children will receive rather more of this spending than people of working age, as the bills for pensions, education and health are three of the biggest.
The gap between what is spent and what is collected in tax will mainly be borrowed, though the government does have some non tax income which helps.
On Conservative plans reported in the last Budget book from the Treasury by 2019-20 the amount spent per person will be above £12,400 on average for every man, woman and child in the country. That’s an increase of 7% compared to this year, which could buy us more public service if inflation stays low.
In that year the Treasury forecasts tax revenues of £11,600 for every man, woman and child on average. This large increase of almost £2000 or over 20% does not require any tax rate rises. It comes about from economic growth. As more people get jobs so they pay more income tax. As people have more money to spend, so they pay more VAT.
This forecast higher level of tax receipts means the deficit is eliminated. The state would not then need to borrow, as the tax revenues and other income pay for the spending.
Labour, the Lib Dems and the SNP all want to put up taxes and they want to borrow more. The more they borrow , the more tax they will in due course have to impose to pay the interest on the borrowings and then to repay them. They want to tax higher earners more, and want to impose additional taxes on some people’s homes.
Published and promoted by Thomas Puddy for John Redwood, both at 30 Rose Street Wokingham RG40 1XU