Recent Treasury figures demonstrate that Mr Osborne’s assault on Non Doms in the UK has meant some have left the UK. Rather than have to pay UK tax on their worldwide assets and income a good number of very rich people have decided they will not stay at all in the UK and will no longer pay UK taxes on UK investments and no longer earn money and profits here in the UK and pay tax on them. It means we lose the ability to tax their purchases of homes, cars and the other items they enjoyed when here. The number of Non Doms fell from 90,500 in 2016-17 to 78,300 in 2017-18. Their payments of CGT, Income Tax and NI fell from £9.5bn to £7.5bn. We also lost other consumption and transaction taxes they would have paid including Stamp Duty, VED, VAT and others. It is true some of the Non Doms converted to being domiciled here and now pay tax as a resident as an offset, but others simply left and pay nothing. The Treasury does not give us an overall figure of total tax paid by rich foreigners in both categories.
I am defining rich here as someone who has substantial investment wealth above and beyond their home or homes, people who do not have to work to earn a living and who can sustain an expensive lifestyle without getting a job. I am not talking about the well off who sustain a high quality of life by well paid employment income and who work for UK based companies or institutions.
In a world where people are rightly condemned for saying unpleasant things about groups or categories of people, an exception is made for the rich. Politicians of the left delight in tribal incantations against the super rich, often condemning them for the crimes of a few. I have met various rich people in my time in politics and government. I have met or read about saints and sinners. Some are modest, caring and keen to help others. Others are self seeking and self promoting. Some are scrupulously careful to do the right thing, others keen to push the boundaries of the rules. A few I see in the media are criminals who have broken laws to make their fortune or to try to sustain it. Most are law abiding, and take advice to try to comply with very complex tax and property laws that countries now apply. There is no evidence to suggest that there are more rich cheats as a percentage than cheats from any other income level in society. We should exercise the same care when seeking to describe the rich as a group, as we do when trying to describe a national or religious grouping.
Some argue that there is no trickle down, that there is no advantage to a country in attracting globally rich people to spend time and money in our community. I find this difficult to understand. There is clearly a first round effect when a person arrives in the UK and invests money in homes and businesses. They may bring a new business we need, or they may fund businesses here that require cash. There is a continuing benefit from the employment they generate from the things they buy and the services they need. There may be a final benefit if they come to love our country, as they may go on to endow charities or leave some other legacy.
To those who say they have driven the prices of homes up needlessly against the rest of us, I would say they competed to buy homes most of us could never afford. They have brought forward a new export business especially for London of building high specification very expensive flats we would not otherwise have developed. These in turn spawn substantial employment to furnish them, service them, supervise and manage them. The German business model has been to sell rich people expensive cars they do not need but want. The UK model has been to sell them expensive homes they like but do not need.
The UK over many centuries has welcomed entrepreneurs and other wealthy investors to our shores. From the Hugenot cloth makers to the middle European bankers, from the oil sheiks to the Russian emigres, the UK has provided a home for people who can make a difference and who soon contribute from their UK incomes substantial UK tax revenue. Maybe it is time to revisit this question of how we tax them. We need to tax them to make a good contribution to our needs, whilst remaining competitive internationally.
August 20, 2019
Sir John,
I would love to comment constructively on your post today, but, sadly, as a relative pauper living abroad and suffering from the discrimination of a frozen UK State Pension, I feel unqualified to do so.
August 20, 2019
” We should exercise the same care when seeking to describe the rich as a group, as we do when trying to describe a national or religious grouping.”
Erm.
I am not jealous of Muslims. I am not jealous of West Africans. But when I read the Mail I am made to feel very jealous indeed of rich people of one sort or another. Success is never popular in the egalitarian environment! Jealousy as the Labour and Lefties know all too well wins elections…
Thank you, Sir John, for standing up for this very important minority which, as you rightly say, is composed of – gasp, shock horror! – human beings like us!
Reply Jealousy is not as popular a political emotion as the left like to think. They hoped jealousy from the many parents who do not have children at a grammar school would mean votes on grammars led to their demise. They did not. Most people are not jealous of footballers and singers they like earning large sums of money.
August 21, 2019
Sir John,
The left is keen on jealousy, because it allows the losers to claim some sort of legitimity.
This jealousy of the rich is natural and easy to exploit, see the popularity of that nonsensical book by Piketty about inequality.
As Sir John said above, very few people are competing with the top 5% (rich) for ANYTHING, not yachts, not houses, not cars, not groceries and not holidays.
The number of zeros in their wealth count has no material influence on the other 95%
August 20, 2019
I hope you can scrape together a few bob to get yourself home by November as conditions for Brit’s living abroad are about to become a lot scarier-
Prii Patel wants to dish it out to the Europeans- can also work the other way- am afraid
August 20, 2019
crazyTimes – can you tell me where Priti Patel has dished it out to Europeans living in the UK, please? I thought Boris was in full agreement of settled status and had actually put current residents minds at ease.
August 20, 2019
Patel says free movement ends on Oct 31.
That will work both ways. So it will stop EU citizens coming here bureaucracy free to live, work, love and study.
But it will also be reciprocated and end the ability of UK citizens to live, work, love, study bureaucracy free in more than 31 other countries. EU citizens still have more than 30 countries to choose from. We will soon have 1.
This is a right that Mr Redwood’s party has stolen from younger generations. Of course their own offspring will not be affected. The uber-wealthy Brexit elite like Lords Lawson, Lilley and Bamford will still have homes in France and can afford the paperwork. It is the rest of us the Tory thieves have stolen this right from. Young people will be outraged.
Reply EU universities will still want to attract UK students!
August 20, 2019
Ending free movement doesn’t end travel. Your posts are absurd.
August 20, 2019
why is free movement a RIGHT? Ask USA, Russia, China, N.Korea, indeed why does any country have passports?
August 21, 2019
Andy, I’d heard that Priti Patel had talked about future free movement, my question to crazyTimes after they stated “I hope you can scrape together a few bob to get yourself home by November as conditions for Brit’s living abroad are about to become a lot scarier-”
Why would people already resident in the EU or the UK for that matter have to get themselves home by November as they have been told they can have settled status by Boris and Priti haven’t they?
August 21, 2019
“This is a right that Mr Redwood’s party has stolen from younger generations.”
Andy, This isn’t correct either is it? The Conservatives led by Cameron and Osborne in 2016 campaigned for remain, they spent £9.3m on a mail drop leaflet to every home to say why they wanted to remain. The people chose not Mr Redwood’s party.
This is “A once in a generation decision”..”The government believes it is in the best interests of the UK to remain in the UK”…”This is your decision. The government will implement what you decide”.
When Ireland was given its independence from the United Kingdom, we didn’t discuss punishment, terrorise the Irish that were resident in the United Kingdom threaten them with forcing them to return to Ireland. Indeed we kept a common travel area. The UK acts in good faith, lawfully and gives away much more than we are given.
August 20, 2019
And to add to my comment, I have, on four occasions during the current tax year, attempted to advise HMRC on their website that my tax coding is incorrect as they insist that my state pension has increased.
Each time, they write telling me that DWP has advised them that my pension has gone up, but DWP tell me that they do not advise HMRC. I believe them.
What an utter waste of my time, but more significantly of taxpayers money, in insisting that HMRC will only consider adjusting my tax code if I get a letter sent from DWP to me here in Australia confirming that my pension is frozen, then sending the letter by snail mail to HMRC. DWP will not liaise directly with HMRC.
How can HMRC NOT be aware of the situation in various parts of the world where pensions are frozen? Perhaps the obvious answer is, as we leave the EU, and a decision needs to be made regarding the pensions of UK nationals living in the EU, that it is now appropriate to treat all UK nationals who do not reside in the UK on an equal basis and restore annual pension increments accordingly to all those who have been denied for years.
AND, for all those who have commented here that us oldies should not be entitled to the pension to which we have contributed during the whole of our working lives because such pensions are actually being funded by the younger people working today – where do they think our contributions went during our working lives? Answer – to the older generation existing at that time.
Sir John, Please get Sajid Javid to look at this discriminatory and, to the fair-minded, indefensible situation. The Brexit dividend will deliver sufficient for this issue to be rectified once and for all.
August 20, 2019
You said you live abroad.
Outrageous that we are sending our tax money to fund someone overseas.
This is no different from someone sending child benefit abroad.
Stop his pension now.
August 20, 2019
Actually we are sending his money to him, a pension is a differed income, it was earned and is now being paid and should be paid regardless of where the pensioner is.
Child benefit is not earned or deferred income so why should it be paid to someone who has not earned it or contributed?
August 20, 2019
But his pension has been paid for by over 30 plus years of national insurance contributions during his working life.
You misunderstand the way pensions work.
Which is very odd considering you tell us you run a big business.
August 20, 2019
Pensions are not benefits son.
They are contributions based
August 20, 2019
As long as they are not paid more than they contributed.
August 21, 2019
almost dead…..when my state pension adds up to more than I paid in I will be challenging Methuselah. Plus sadly we have lost so many friends/workmates/relatives before they reached 65. Even then the estate is taxed one way or another. I don’t envy those who didn’t prepare for pension years, by giving up income when they were young and middle-aged. The whole subject needs some form of education of the post school age maybe extra insurance to be paid.
August 20, 2019
why should UK be expected to pay for EU mep pensions after we have left?
August 20, 2019
I thought you would be unable to resist your predictable dig here, Andy.
I continue to pay UK tax – just like you.
August 21, 2019
Andy, please read your national insurance history. Why don’t you understand how NI insurance and the Old Age Pension was sold to the British public over the years, are you self-employed and not paying a combined contribution of 25.8% national insurance contributions on earnings over £8632 pa which would explain to me why you are so blasé about getting your contributory benefit out as promised?
The public were told they would have “universal social protection” and an Old Age Pension. Friendly and private societies used to operate the first schemes, these were blitzed and nationalised and that’s why we’re in this mess because we were told to trust ‘our government’. The Labour government go on all the time about how the NHS is at risk of the Tories but Blair’s Labour government did more to remove comprehensive free at need dental provision sending us back to the dark ages of people pulling out their own teeth and getting blood poisioning, out of hours local doctors provision and signed the NHS up for over the top PFI agreements to build and improve hospitals totally not competitively.
August 20, 2019
All true. If it’s not only very rich non doms who have gone but also many in the well off, working category. They take with them the potential to tax their income and gains and consumption taxes, but also money, investment and often business and employment opportunities. Mr Javid would do well to reverse all Mr Osbornes virtue signalling anti rich policies where these have clearly led to a fall in revenues.
But one thing you hear everywhere amongst such people is that while they don’t like such taxes, and are generally negative about brexit, what really concerns them is the realistic possibility of a far left, Marxist govt. If corbyn and his gang get near power – even for ten minutes under the ridiculous GNU remain idea – there will be an exodus, and a resulting collapse of tax revenues.
August 20, 2019
Which is why Remainers should always give us their figures for Remain AND Marxism – because this is what reneging on the referendum result will bring us.
CHUK, the second referendum party is so popular that it’s disbanded.
August 20, 2019
As Harry Redknapp once said of the highly-paid in football “Just how much money do these people need? You can only sleep in one bed at a time and eat three meals a day”.
Wise words indeed, Harry.
So why exactly, do some billionaires object to paying tax? Would they feel it at all, materially, at even a high level?
Of course not. However, they apparently don’t think that anyone, or any agency, should be able to require them to do anything, whether it be paying tax or not parking on double yellow lines.
The countries of the world must unite to stop this squalor, and I commend the European Union for being at the forefront of efforts to do this.
August 20, 2019
“We don’t pay taxes;only the little people pay taxes.”
Leona Helmsley(later convicted and imprisoned for federal tax evasion).
August 20, 2019
Yet 28% of UK income tax is paid by the top 1% of earners.
August 20, 2019
And approx half the people in the UK pay no income tax at all.
So much for your claim that “only the little people pay taxes.
August 20, 2019
They effectively become human corporations with a management team beneath them minimising tax profile.
August 20, 2019
Anonymous
Er no they dont , not for football anyway
1) The FA mandate that footballers are paid on PAYE payroll and therefore have tax deducted at source by the club
2) Some footballers have PSC’s ( personal service limited companies) but these are limited to managing their image rights etc , they are registered and liable to charge and collect VAT as well as pay corporation tax on profits. Any profit taken by them from the company ( a dividend) is subject to income tax
3) Some footballers tried to argue this and were “caught” under IR35 legislation ( see Bergkamp v HMRC)
August 21, 2019
With the dividend tax high earning taxpayers pay 38.1% on dividends and that is after corporation tax just under 20%. The appalling economic illiterate G Osborne to blame yet again and retained by the dire P Hammond and so far by Javid too.
“I’m looking at various options. I’m a low-tax guy. I want to see simpler taxes,” Mr Javid told The Times.
Well they all say that Javid what about some action from the current hugely overtaxed UK position?
August 20, 2019
MiC
Thats laughable the EU is specifically set up to use transfer pricing for large conglomerates to avoid paying tax . The new proposed EU tax clampdown is laughable there are more loopholes in it than a colander
In total we paid £174bn income tax in 2016-17, the latest year for which figures are available. But of that, £52.5bn – nearly a third of all tax raised – was paid by the 381,000 taxpayers who earn more than £150,000 a year. The tax paid by those 381,000 individuals (overwhelmingly male) was more than all the income tax paid by the first 20 million taxpayers.
Of course I forgot youre a socialist so you dont understand the tax system
Let me explain
Aside from VAT, duties , council tax etc that every single person pays there are two other real forms of tax
Income tax and capital gains tax
Income tax is levied on what you “earn ” each year , so wages, income, interest earned
A billionaire doesn’t EARN that amount a year that is the value of their assets , they pay income tax only on any interest they earn and capital gains tax on any asset that they sell. Someone such as Gary Linker who does earn more than 1 million per year will pay income tax at the highest rate
The tax gap for 2016 to 2017 is 5.7%, HM Revenue and Customs (HMRC) confirmed. The UK now has the lowest tax gap in Europe
The tax gap is the difference between what HMRC calculate should have been paid in total and what they actually got
By the way
Percentage tax gaps in EU countries vary from 7.98% in Luxembourg to 29.51% in Romania.
In absolute amounts the biggest tax gaps are in Italy, France and Germany.
Half of all EU member states have tax gaps that exceed their healthcare spending, and often by considerable amounts. Yay lets hear it for the EU as once again the UK OUTPERFORMS the saintly EU
August 20, 2019
Corbyn/Mc Donnall/Sturgeon gaining power would be a total disaster for rich and poor a like.
A real Brexit is certainly positive for the UK after some adjustment. Trade deals will be done anyway as the EU will want them.
August 20, 2019
With the UK’s growth by comparison with much of Europe, the fall-off in investment and the virtual sterling crisis, the benefits of Brexit are at the moment disguised from us. I hope the govt feel a sense of extreme urgency at putting in radical measures to restore growth and confidence immediately post brexit. then there will have to be an election to get a majority so such measures can actually be implemented.
August 20, 2019
Good morning.
Weirdly enough I was just thinking about this this morning !
My belief is, that the UK rich did not like the competition and so, used their connections to game the system to suit themselves and bring down the cost of buying a luxury home. That’s my theory 😉
It would seem that they can import people from all around the world to bring down the wages of the rest of us but, as soon as someone comes in and can out spend them on housing and schools, it just ain’t fair anymore.
The Left have always used the politics of envy to gain power and, well, enrich themselves. There is no trick down effect in Socialism otherwise, they would all be rich. I mean, why are there so many poor in Labour held areas ? You would think that having a Labour or SNP government for so long they would have solved the problem. I mean, look at Venezuela ? A country floating on oil yet, a sheet of loo-roll is worth more than the national currency – allegedly.
Cut taxes for all. The rich do spend and they spend on high value luxury items that the UK excels in.
August 20, 2019
When you say ‘…the UK rich did not like competition and so used their connections…’ etc. you make it sound as though they act as one unified group in concert. I suspect they simply want a home and can either afford it or are beaten by a competing offer exactly as happens all the way down the housing chain.
On the question of housing shortages, I live in an area where there is an ever increasing number of second homes and holiday lets which drives up the cost of smaller properties. I would like to see these charged the full amount of council tax and discourage at least some of these buyers and thus reduce the demand for ever more houses being built on greenfield sites.
August 20, 2019
Good point Mr B.
The moderately wealthy George Osborne virtue signals to the commies and at the same time reduces competition for luxury properties and table reservations at top tier restaurants for him and his chums.
In the meantime anyone without the means to support themselves can pitch up from the third world and claim a plethora of welfare benefits paid for by the average wage earners, thereby increasing competition at the lower end of the homes market, and simultaneously lengthen queues for public services.
I don’t suppose Mr Osborne is too bothered about nursing home costs.
August 20, 2019
The Tories used to elevate the interests of the UK above the interests of itself. Now, the opposite is entirely true. Its pathetically desperate lurch to the left to mirror the dregs of Labour is redolent of the Tories move to the left under Heath. Attacking the idiotically titled ‘the Rich’ is an act of pure politics designed to express one’s social concern. It is gesture politics
We need more taxpayers in the UK. We need higher income taxpayers in the UK. We don’t need politicians and their destructive tendencies driving them away as they scramble to portray in public just how virtuous and lefty they are. It is an act of criminal insincerity
I would have more respect for politicians if they stood on a platform and declared they had zero concern for other people.
Utility and common sense not ideology and party interest should inform public policy. We are not seeing that today. May’s lurch to the left (for seemingly party gain) has left our liberties in ruins and opened the gate to a political party that has the capacity and the will to pillage and extirpate all that is good about the UK
August 20, 2019
When blindingly obvious becomes the norm rather than the exception then our days as a serious society are numbered. There is an argument that human nature has an inbuilt self destruct mechanism akin to forest fires clearing the way for new growth and then the cycle starts again. Most of us contributing here could write a new tax system on two sheets of A4 but when simple changes such as combining income tax and natins. or removing 1p and 2p coins are beyond our treasury gurus then the prospect of a sane system is zero.
August 20, 2019
A.S.
When I first arrived in Oz, I thought I was being diddled when, because of absence of all coins below 5 cents, but goods were priced in multiples of one cent, the amount I paid was rounded to the nearest 5 cents.
I soon realised that this worked both ways and overall is totally fair. So I urge the Treasury to ditch 1p and 2p coins immediately and everyone will soon get used to the new system. The maximum total loss /gain in any transaction is 2p.
Anyone who could instigate such change – just talk to their Aussie counterparts.
August 20, 2019
You say “Politicians of the left delight in tribal incantations against the super rich” indeed they do. Another group constantly attacked by the left, the BBC (and recently attacked by Hammond’s absurd tax mugging) plus Corbyn’s Labour and the current government are landlords. Motorists too are often irrationally attacked.
Most landlords I know are fair minded people and just trying to run a business and provide reasonaby housing for people despite the appalling legal & tax systems and with red tape stacked against them by government and now with restricted bank lending too. With Ed Milliband now Corbyn threatening just to steal their assets off them in the end anyway. The Conservative not really that different in this matter either.
You say:- Some argue that there is no trickle down, that there is no advantage to a country in attracting globally rich people to spend time and money in our community.
Some ‘politics of envy’ lefty idiots do indeed say this they are clearly wrong,
August 20, 2019
Yes another group endlessly attacked are Climate Realists & Luke Warmers (and anyone who know a bit about energy engineering, C02 emissions and understands the laws of physics). Usually by the BBC types, leftie art graduates and the other foolish disciples in the St Greta Thunberg religion.
I see that Sir Elton John has defended Harry and Megan use of private jets – saying he paid to ‘carbon offset’ their trip to his French home. So what? They still chose to take this private jet. Also so what if you did carbon offset it for them? It could have been carbon offset, then flown economy and used the huge savings for even more carbon offsetting if you/they actually believed any of the alarmist drivel they come out with.
These people should either lead by example (if they really are ‘believers’) or they should shut up and stop lecturing other people. Endless blatant hypocrisy from them fools no one and makes them look pathetic and dishonest.
Charles and Emma Thompson should also take note.
August 21, 2019
With crazy numbers of power stations being built, population soaring, transport responsible for pollution, deforestation, seas becoming junk ‘yards’ I think there are more concerning issues than use of a private jet. Get a life.
August 20, 2019
There are no doubt many other perceived advantages to being in the UK for the super rich other than just tax. After all there are a number of other destinations offering them a better tax deal. The principal in retaining them should be to keep tax at acceptable levels and under rules that are easily understood minus an army of tax advisors.
It is exactly the same principal that should be applied to the taxation of everyone in the UK. A reported 17,000 pages of tax rules is ridiculous. It only breeds avoidance and an army of advisors to facilitate it. So Mr Javid, please put the collective intellect of the treasury to work at simlefying and elliminating until we have a regime that we all understand. Better the effort spent on this than the black propaganda exercise they have been conducting for the past three years.
August 20, 2019
Complexity is the oxygen of bureaucracy, simplification its enemy.
August 20, 2019
Gives the children of the “right kind” of people in jobs after their expensive education.
The mystery protects an upper echelon of civil servants, lawyers and tax specialists.
The rest of us struggle to get a simple tax code from a dumbed down workforce over-reliant on computers although to be fair, they are probably overstretched: Tory governments have been quite good at making false economies and a department that collects income should be robust.
August 20, 2019
Tax clarity & simplicity would certainly help alot, but UK taxes for the rich are still way to high (and very complex too). The advantages of living in the UK for me are certainly not worth anything like the sum I would have to pay to live full time in the UK.
August 20, 2019
The UK needs to become tax competitive and it is miles away from this position with the highest and most complex and idiotic taxes for 50 years. The state sector need to be cut back from nearly 50% of GDP to more like 25%. It would then though be 25% of a GDP that was far higher. Get the state out of subsidising and augmenting the feckless. Give freedom and choice to people especially in healthcare and schooling using education vouchers and sensible tax breaks. Freedom and choice for individuals is what is needed.
I now live ouside the UK have done for over 10 years. If I lived in the UK it would cost me over £1 million more PA in taxes plus other large costs (and much wasted time that I would incure dealing with tax planning and compliance issues). I still pay a considerable sum in UK taxes (on my UK businesses, rents and now some capital gains too). I have no wish to pay more taxes in the UK. This as the government is clearly so wasteful and incompetent at spending it sensibly. I invest and use it far better myself than they would. If they were more efficient I might be happy to pay more but there seem little chance of that.
I prefer to support some charites that I know are sensible.
Indeed I regard it as my moral duty to try to pay the minimum to the UK government to stop/reduce all the endless waste they indulge in. When they cut out the waste and misdirection I might be happier to pay a bit more.
August 20, 2019
The State sector’s is one of Labour’s political and financial assets. This will never be cut back as it affords Labour huge leverage over the Tories and how they conduct public policy.
It took me a long time to understand that the last PM that elevated national interest above party was Thatcher. Since then, all parties in government have worked hard to spend more of our money as it affords them a political advantage to do so. It’s going to take an outsider party to implement radical State reform or bankruptcy
August 20, 2019
“Get the state out of subsidising and augmenting the feckless.”
The first step for this would be cutting the red tape making it hard for people in some groups to get jobs. I’ve mentioned before many of my clients are in the charity sector, and some work with these groups. If someone is coming off long-term benefits or sick leave but has no references, getting a job can be virtually impossible. Similarly a person who cannot perform labour to the cost of the minimum wage won’t be hired, that’s basic business sense, but also may not qualify for income support or benefit. Many went into self-employment but, as has been shown by the users’ complaints, Universal Credit has not helped this sector.
August 20, 2019
Should non doms be allowed to access websites in this country? The answer clearly has to be no.
August 20, 2019
So, all around the world, you are saying that, in every country, citizens should only be able to access their own country’s websites.
August 21, 2019
Are you a non domiciled resident in the UK for tax purposes; not if you live in Oz.
August 20, 2019
This is yet another example of how socialism distorts views – especially when we are talking about labour or libdems – they thrive on misinformation and their approach to ‘fairness’ is always distorted by their dogma.
Taxing people more simply because they have more is morally unacceptable, but if people choose to pay high prices for high quality then they will be happy to pay the tax on that….. One reason why we should be getting more tax income from a revised set of VAT rules.
Yes our current taxation system is unfit for purpose – In the new iteration it must be ensured that taxes are appropriate.
August 20, 2019
Sir John, I think you need to take a look at the number of Unexplained Wealth Orders issued by the government. The figure is, I believe, yet to get into double-digits – even though London is awash with foreign crooks. Personally, I would rank by wealth every last (named places ed) millionaire with residence here and, starting at the top, hit them with a UWO. And you need to take a look at how many London flats are sold off to foreign investors – Chinese, Malaysian, Singaporean – to then lie vacant and pristine until being sold on, sucking more wealth out of the country then was ever put in from Asia. I wouldn’t hesitate to ban foreigners buying London property until you and the rest of the political class can say that the housing crisis is over and a policeman, teacher or nurse is now able to afford their own home in THEIR capital. And yes, I am comfortably the most right-wing and Conservative poster here.
Reply You make my case for me. Just because someone has money and comes from a given place it does not make them a crook. UWOs should be issued where there are good grounds to think someone is a crook. Most rich people are not crooks and should not have to face a UWO
August 20, 2019
reply to reply…..sometimes our laws are hilarious. My wife annually pays into grandchildrens (trust) funds (they were called). It is only ever a few hundred, never been many thousands causing concerns, BUT the banks/societies make it hard work to action the transaction. Why? Well they say ‘could be money laundering’. After falling about laughing, the serious side is this is such nonsense. Yet foreigners come here buy supercars, buy £multi-millions homes etc ….just how do we satisfy ourselves there is no money laundering going on?
August 20, 2019
A good way to tax some of the richer people more is to encourage people to use private schools and private health care (with vouchers or tax breaks). Thus lightening the load on the dire NHS and state schools. Over two weeks just to see the (rationed) GP on average now it seems!
Other easy things to cut are all the renewable and greencrap subsidies, HS2, electric car subsidies, the state soft loans for totally worthless degrees …… everywhere you look in the state sector there is endless waste and fat that could cut out. Releasing people to do productive work instead. Cutting red tape and simplifying the tax and employment systems would be a huge win win for everyone. Other than a few duff/lazy employees perhaps.
August 20, 2019
A good interview on the Dellingpod podcast this week of the sound economist Ruth Lea. Perhaps the only sensible economist who is actually allowed onto the BBC ocasionally.
August 20, 2019
The BBC preferring pleasant, attractive, but totally deluded leftie economists like Grace Blakeley, (if you can count Oxford PPE grads as ‘economists’ that is).
August 20, 2019
Come to the UK and pay perhaps £1 million a year in extra taxes. We the government will then waste most of it. Then on death we will pinch another 40% of everything left above £325K too and waste most of that too.
This is the UK government’s offer to the wealthy. It does not look that attractive to me nor to many other wealthy people!
Even Italy now has a tax cap of about EURO 100K PA I think. Good food and some very cheap and nice properties in lovely places too. Alas in the EU but perhaps not for that long.
August 20, 2019
Good Skiing, nice weather, lowish costs of living only 4% to 8% inheritance taxes and lots of good connecting flights, road and trains too. Just the odd earthquake and dodgy bridges to worry about.
August 20, 2019
Plus the inheritance tax threshold in Italy is euros 1,000,000, but of course we were promised £1 million by that by the rotten George Osborne many years ago. It is still £325k.
August 20, 2019
You forgot the Mafia!
August 20, 2019
What I require is a level playing field for all, not a set of rules for those who can widespread take tax avoidance measures and another for those who can’t.
If my earnings are subject to an overall 50% tax deduction, including employment taxes, council tax, VAT, duties and VED then everyone’s earnings should be subject to a similar percentage. The poor possibly pay a larger percentage while the rich certainly pay less.
You will point, Mr Redwood, to the totals being collected but I will counter that the earnings are rocketing so the total tax from the well off should be increasing.
You also claim that the demand being driven by these people is for luxuries out of my league. I say that resource which could have increased supply in my league is being diverted to this premier league’s requirements thus reducing the supplies I can afford which puts prices up.
We need the well off, we should welcome them but being that rich comes with responsibilities and contributions.
Reply Yes, they can and should pay the same rates of tax as everyone else on their UK earnings and activities.
August 20, 2019
The politics of jealousy, greed and envy gets you nowhere. You are so right Sir John.
August 20, 2019
That’s a Counsel Of Despair if ever I read one, John.
International co-operation is required to address this problem, and it is highly commendable that the European Union has been foremost in this respect.
I surmise that those who would have been affected were, quietly or otherwise, central to getting the referendum, and to the various Leave campaigns.
August 20, 2019
The EU has had decades to address these issues Martin, but they have not acted and they never will.
The rich elite are in positions of great power in the EU and like their tax havens left as they are.
August 20, 2019
Completely off topic an back to Brexit,sorry:
Followed your link to “facts4EU” this morning and they have published his letter to Rusk about re-opening negotiations:the changes relate primarily to the backstop.
No, Boris, they don’t, there is so much more and I’m not alone in waiting for you to stitch us up,.
I don’t trust you and if you think that getting rid of the back top will get the rest through Parliament it won’t work: the remainders will see it as a sign of weakness and push for delays, referendum or a General Election and you will be out.
August 20, 2019
Tusk has, as many forecast, arrogantly rejected BoJo’s invitation to reopen the thrice- rejected WA. BoJo is now free to press on with a WTO Brexit.
August 20, 2019
The rich and super rich have been very much part of the changed landscape of he UK economy. Yes they use their money and partner with UK private sector business for good investment. We need to maintain the country and London as an attractive global touch point.
August 20, 2019
What about the overtaxed middle class. No one is fighting our corner. The new probate tax, inheritance tax and now attacks on second homes.
Time for a bonfire of the tax book
August 20, 2019
You make some reasonable points but no where mention the iniquitous system of companies and individuals using tax havens. There is also the questionable use of LLP’s in the UK. There is rarely any point to these except to avoid or evade tax.
August 20, 2019
It would be great to consider taxing native British at a rate that allows them to become super-rich. A friend resident elsewhere has built in numbers huge warehousing at critical points in the U.K. for distribution. They cover acres. He could do this because he was not subject to CGT when he sold to Amazon etc., and could roll over the profit into another project. No British resident could do this. So we have the distribution infrastructure because somebody was legally allowed to bypass British punitive taxation.
Then we are told that British people are useless and need clever foreigners to do everything for us!
August 20, 2019
Ed Milliband had promised to remove non-dom status and it became politically difficult to maintain tax breaks for the wealthy that were not available to ordinary working people .
It is somehow mean spirited of you to sneer at George Osborne omitting the context.
That said I have no doubt there is net loss to the exchequer for no better reason than spite.
That is the problem with populist politics , it is all too easy to rouse envy and grievance , it is considerably more difficult to do what may be the right thing.
Perhaps you would bear this mind next time you are blaming immigrants for high housing costs queues for the doctor, low wages and the common cold.
Reply I have not blamed migrants in the way you allege
August 20, 2019
Sir John may not have blamed population increase from incomers but let me reiterate that it is at least a major contributory factor in all you list @new
August 21, 2019
The population has increased by about 10m since the 60s , more houses have been built proportionately in that time .The Population / housing ratio is not the problem
Migrants from the EU without doubt , contribute more to the NHS than they take out . They make a net payment the exchequer and as young people use the service little .
Migrants have increased growth , demand and economic activity . It is possible , though not proven there is a small affect in retail but the stagnation of wages has no correlation to the levels of migration
These myths are what gave us Brexit and John Redwood has drawn on them repeatedly by the use of allusion and association . Naturally he avoids making outright and provably false statements but I could quite simply provide you with quotes which are transparently seeking to bring these myths to mind
August 22, 2019
If you were right GDP per capita would have risen greatly.
But it hasn’t.
PS
Since 1960 the population has grown from 52million to nearer 70 million.
A new city the size of Sothampton is needed every year.
Yet you tell us this growth in population has had no effect on the housing market.
August 22, 2019
Newmania, I personally have no problem with working, contributing migrants from anywhere in the world especially if they are covering their costs on our generous working benefits system that exists to help raise children to all our advantage that live here in our very expensive Country. I do not agree that anyone that lived here less than five years should get housing benefit, if they can’t earn enough with their skills to put a roof above their and their families own heads then they shouldn’t be here claiming, we have sufficient homegrown subsidised families to help to raise [with generations and generations of support because we’re not getting a grip of this education problem].
We have been told this week that the ONS have got their figures wrong for several years and under-calculated numbers, this just leads to more distrust. I don’t know why numbers are so difficult to monitor if as you allege they are all contributing sufficient tax and national insurance to cover their annual cost plus some. Plus it raises another question if we have an extra two million migrants all working and paying sufficient taxes and are fit and hardly using the services why is the NHS in crisis with so much more money pumped in? British people are now having to see nurse practitioners instead of Doctors or told to go to hospital and wait several hours to be seen.
fullfact.org “25 May 2018 – Studies find that immigration affects low-waged workers the most negatively. ” Immigration has slowed low waged workers wages are going up.
Vince Cable said “migrants rarely supplanted UK-born workers, but went into expanding industries where there were simply not enough people to do the jobs or UK-born workers willing to do them.” what he should have said was UK born workers willing to do them for the minimal wages offered. UK born workers don’t live ten people to a house and spend little of their wages in this Country whilst sending money back to their families and we were shown repeatedly on tv programs building homes in their home Countries supporting families with many children off low-paid in-work benefits (that is not what child tax credit and working tax credits were set up for and the UK government were foolish to set these benefits up in this way without a five year national insurance record to gain them – Germany and Austria are now struggling with this and want a change in benefit repatriation that Juncker refused David Cameron).
August 20, 2019
Slightly off-tangent.
Not impressed by Boris’s back-pedalling on the backstop. I think he’s going to try to slip May’s deal through parliament by the back door.
August 20, 2019
What else did you expect?
Boris means Boris.
August 20, 2019
Off topic: Very disappointing letter from Boris Johnson to Donald Tusk yesterday. It lacked any fresh vision or new confident approach from UK government just more fudge and continuation of Mrs May’s wretched Withdrawal Agreement but without the backstop. Haven’t we been told time and time again that the WA was dead? What about the £39bn? Not just disappointing but unacceptable. On that basis my vote remains very firmly with the Brexit Party.
August 20, 2019
+1
August 21, 2019
The threat of Brexit will surely force Boris to deliver a real Brexit but we shall see very soon indeed.
August 20, 2019
Our world, in which people are condemned for saying unpleasant things about groups and categories of people is, for that very reason, at risk of slipping once more into unfreedom. The most precious and central right of liberty is the right to be wrong; to say things to which others object. In my childhood it was routine to hear jokes and disparaging remarks directed towards all sorts of categories – mostly done in a spirit of good humoured jocosity. The Japanese and the Germans …………….. the Italians as cowardly; the French ……………… and so on. None of these doctrines were regarded as serious but they were held to contain a grain of truth. Oh, and the Scots were mean, the Welsh were windbags. You know the kind of thing. Compare the situation of today. Where is that good humoured jocosity, the sign of a society at ease? Nowhere. What are the levels of dislike and vexation? High. I think, Sir John, that condemnation for mere words has – as a social policy – failed.
August 20, 2019
Is it taxes driving the super-rich away? Maybe it is the level of crime in our capital city. Maybe it is the unpleasant feeling they get seeing people sleeping in doorways. Maybe it is the weather.
Your Government continues to pander to the super-rich and squeeze the hard working people in this country. The gap between rich and poor gets ever greater. The greed and arrogance of some people is unbelievable. Telling us how to live as they fly around the world in their private jets and super yachts.
Today we read about the Centre for Social Justice (CSJ) wanting to raise the pension age to 75 by 2035. Do you really think sounding out policies like these will get you re-elected?
Also what’s your view on the letter Boris Johnson has sent to EU leaders suggesting if they change the backstop he will resurrect Mrs May’s Withdrawal Agreement and put it to a vote in Parliament? BRINO again.
Nigel Farage is right to think there is betrayal in the air.
What we need in this is a complete overhaul of politicians. We need someone who will put the needs of the hard working people of this country first. We need someone who will root out the huge amount of waste in our public services. We need to stop payments to the EU and Foreign Aid.
Expecting people to work until they drop and taxing them to death is not the answer.
August 20, 2019
Off topic, Boris Johnson’s letter to Donald Tusk may be read here:
https://www.politicshome.com/news/uk/political-parties/conservative-party/boris-johnson/news/106014/read-full-boris-johnsons
and I would highlight this passage, with some disappointment:
“This Government will not put in place infrastructure, checks, or controls at the border between Northern Ireland and Ireland. We would be happy to accept a legally binding commitment to this effect and hope that the EU would do likewise.”
which incomprehensibly fails to mention that the UK government has already accepted a legally binding commitment to that effect through UK law, Section 10 of the European Union (Withdrawal) Act 2018.
http://johnredwoodsdiary.com/2019/08/15/trade-wars-4/#comment-1045789
“It is understandable that Theresa May wished to suppress all public knowledge of this provision, WHICH IS ALREADY PART OF OUR LAW, because it was a central element of her strategy that the UK should gratuitously take responsibility for preventing the EU and the Irish government from putting up a hard border on their side … “
August 20, 2019
From the Telegraph:
“Brussels has hit back at Boris Johnson over his letter to Donald Tusk, with EU diplomats claiming that his demand to abolish the Irish backstop is a “clear attempt” to kill off any prospect of renegotiating the Brexit deal.”
What utter twaddle; according to the EU and its own EU law, as agreed by Theresa May, there was already no prospect of renegotiating the Brexit deal:
http://johnredwoodsdiary.com/2019/08/19/successful-town-centres/#comment-1046989
“This extension excludes any re-opening of the Withdrawal Agreement … “
August 20, 2019
Can trickle down work when corporations are able move to countries where labour is much cheaper? Can taxes here be reduced enough to offset higher wages?
Losing producers like Cadbury’s I suppose was yet another result of being in the EU.
Maybe the essential element to making trickle down work is that the ( low taxed) rich provide stable, long term employment?
Plus plenty of govt investment/spending…but then more debt.
When Labour govts taxed at 90p in the £ the rich..like The Stones just upped and quitted England.. Was Osborne just virtue signalling to the Left?
Reply The Cadburys brand is alive and well and still making things in the UK.
August 20, 2019
It’s no Laffing matter.
August 20, 2019
Tax cuts for all would be a great thing.
Give everyone more of their own money to spend.
How about that hoary old chestnut…a sales tax?
Not an across the board huge levy like VAT but a tax on luxury goods.
So the rich can spend their tax rebates on expensive stuff.
Having said that, in their wisdom, left-leaning govts have destroyed just about everything the rich valued. Like private schools, private medicine. It must be very difficult to get a gardener or maid in the UK now considering bolshy attitudes drummed into kids at Marxist schools. Also..what point is a Rolex or high status car when you are likely to get car jacked in Mayfair?
Fatal stabbing in Marsham Street, Westminster the other day.
August 20, 2019
When talking about the rich I always remember Churchills definition of socialism
Socialism is the philosophy of failure, the creed of ignorance and the gospel of envy. Its only inherent virtue is the equal sharing of misery.
While for example I am no fan of countries such as Saudi Arabia I can only admire the example one of its rich princes has set locally in Kent., who while not a socialite keeps his estate in good state and helps local causes – he is judged by all as a splendid chap. I do not see how rich people are making me poorer either, we buy vastly different houses and cars, although looking at Trump its clear we often enjoy the same food. All of this is good for any country, more rich people means less work for the NHS and a broader healthcare system.
Here, while I am against immigration that lowers the GDP per capita I am all for rich people be they home grown or imported. As a first world country we have very good infrastructure to attract them, we just need to challenge a beat down the evil of socialism.
August 20, 2019
Off topic again, according to CityAM today, page 3 here:
https://www.cityam.com/wp-content/uploads/2019/08/Cityam-2019-08-20.pdf
Boris Johnson has foolishly agreed to feed Leo Varadkar’s arrogance by taking himself across to Dublin for an audience with the great man.
In a phone call with Boris Johnson yesterday evening Leo Varadkar:
“… emphasised the importance of a legal guarantee to ensure no hard border … ”
In that case the Irish Parliament should pass a law forbidding the Irish government from erecting any kind of hard border on their side, in the same way as the UK Parliament has already passed Section 10 of the EU withdrawal act, see above.
August 20, 2019
Clearly the definition of non dom is a nonsense when it applies to people who live in this country, some for a generation or more, although they may have houses abroad including holiday homes and that which some claim to be their permanent residence often in their ancestral homeland. If people live here they should be taxed here; if some don’t like it then they should leave and forgo the benefits they obviously derive from being resident here which for the very rich are manifold compared to many of the countries from which they originated and possibly pillaged to obtain their wealth.
August 20, 2019
A more serious problem is that of people owning property and other assets in this country and offshoring the income to tax havens abroad. This should simply be illegal.
If everybody paid their fair share of tax, then the level of tax could come down for all including the wealthy.
August 20, 2019
I read that letter from Boris on brexit and disagree with it on two key points.
First, the backstop was not the only thing I do not like about the withdrawal agreement, it contains many conditions of EU control and further EU spending commitments I do not support and are optional.
Secondly I do not want the efforts to secure a EU deal to be the main priority of government, I voted for brexit because I wanted deals with countries other than the EU.
If the UK is constrained by the withdrawal treaty I think the brexit party will be very much alive and well at the next GE.
August 20, 2019
Off topic again, here is a reader’s letter in the Irish Times today:
https://www.irishtimes.com/opinion/letters/another-name-for-the-backstop-1.3990928
which is based on the false assumption that all the goods circulating everywhere in the UK must continue to comply with all relevant EU rules in order to prevent “cheap and shoddy merchandise” contaminating the 0.1% of UK GDP which is driven across the land border into the Irish Republic.
As repeatedly pointed out, including in this letter published last September:
https://www.irishtimes.com/opinion/letters/brexit-time-to-mind-our-own-business-1.3636142
“The legitimate interests of the EU and its Irish satrapy do not extend beyond the nature of the goods circulating in its own EU Single Market, and it is gross impudence on the part of the EU to presume that it should be able to continue to control goods permitted in the United Kingdom once we have freed ourselves from the EU, any more than the EU can expect to control goods permitted in the United States or other “third countries””
August 20, 2019
Denis- don’t know where you get the time from researching all of those Irish newspapers- but well done keep up the good work
August 20, 2019
Mark B
“…..I mean, why are there so many poor in Labour held areas ? You would think that having a Labour or SNP government for so long they would have solved the problem….”
All in order to maintain the status quo!
August 20, 2019
😉
August 20, 2019
Lifelogic
Many “reluctant landlords” forced into renting cos govts ruined pension funds.
Useful idiots encouraged by TV progs ( govt propaganda) to invest in property to rent out.
Now govt is pulling plug on the tax breaks and new ( planned?)legislation would virtually hand property over to tenant for life.
So…cynically…housing prob solved…at expense of Joe Muggins?
Housing stock refurbished.
Landlords happy to sell off property cheaply to corporate landlords…or councils?
August 20, 2019
There were never any real “tax breaks” they have just decided to tax profits they have not even made in what is an unsustainable mugging or theft of assets.
August 20, 2019
Glad to see your definition of rich. Too many define rich as high-earners, failing to understand that earning is contributing in many ways to society and the more you earn, the more likely it is that your contribution is not something that just anyone can do.
The reality is that Osborne may have had a point, but it needs every country in the world to do it or the rich simply decamp to a more lenient tax system.
In terms of the principle I believe that there comes a point at which wealth becomes excessive and should be taxed quite heavily.
The main focus of government should be in stopping corporate movements of money and the ‘patsy’ approach of HMRC to dealing with large multinationals.,
I believe that tax should be anchored to transactions with UK legal entities in order to prevent profits being shifted overseas. Basically, the excuse of ‘investment’ is simply abused to death. If companies wish to invest in other countries then they must do so at their own expense, not at the expense of the UK taxpayer.
End the ability to shift profits overseas without paying UK tax. If we have fewer multinationals as a result… that may not be a bad thing – they don’t behave very responsibly towards society or even their employees, only to their shareholders.
August 20, 2019
It has become fashionable to castigate the wealthy for, well, just being wealthy.
Overall, the tax take from those enjoying an income in excess of £100,000 and with capital assets is disproportionately high. This situation has been made worse by recent Conservative as well as Labour governments.
How can it be reasonable for nearly a third of all income tax raised to be paid by just 381,000 taxpayers who earn more than £150,000 a year ?
The tax paid by those 381,000 individuals was more than all the income tax paid by the first 20 million taxpayers. In London, just 87,000 individuals earning over £200,000 a year paid nearly half the £43.8bn income tax raised in the capital. The worse statistic is that the richest 1% of the population pays 28% of all income tax.
Under recent coalition and Conservative Governments a huge proportion of the population have been excluded from paying income tax altogether. This is a bad move for Conservative politicians : these millions of non-tax-payers are likely to vote for Corbyn’s higher taxation plans because they have no incentive not to do so.
I would like to see the introduction of a flat tax rate across the board. Although the poor would pay very little income tax, the prospect of even a very small increase would mean that everyone would have an incentive to keep government spending low.
It would also have the advantage of greatly simplifying the tax regime and make hundreds of thousands of accountants redundant.
August 20, 2019
Has the pendulum of public opinion finally got to the end of its arc with the ‘snowflake generation’ before swinging back?
Will Hong Kong, England, Wales, N.Ireland and half of Scotland escape from the Autocracy of their rulers?
Will we turn our back on decades of senseless pandering to the Liberal Left?
I’d start with a message – bring back hanging. Actually I, as an old soldier, have a dislike of unnecessary killing – but there are times. . .
like the wanton murder of ‘our Public Servants in the exercise of their Duty’ and ‘Children’, when it should be an option.
We’ve lost our respect of ourselves or anyone else – a Pole (living in rural Poland) recently said to me ‘that everything is for sale in the HK’ and she wasn’t meaning that in pleasant connotation.
It starts in School, at home. We see the effects of our loss of standards on Twitter &tc., in drugs, knife crime, the Mainstream Media.
We need to replace our lost religion with what could be called ‘Proper Conservative Values’ (the nasty party).
Our system of Tax and the World Banking system of Debt ‘Management’ cannot survive much longer.
I suspect it will be replaced by one based on energy, if we get past Global Warming.
August 20, 2019
I’m no liberal, but even I baulk at bringing back hanging.
In a perfect world I would support it. But time has shown our justice system to be less than perfect and I can’t see any way of bringing someone back to life if you make a mistake.
August 20, 2019
nor the ones murdered, and the lifetime of misery caused to the families of the victims…..I’ll press the button for you. Can you sleep any easier?
August 20, 2019
Its like a sin to be wealthy in this country and even when you are not wealthy but choose simply to drive a nice car, forgoing eating out and expensive holidays, you are still taxed. It makes me wonder if it is worth working hard to improve your lot in this life.
August 20, 2019
An issue related to the non-doms is the status of British Protectorates. There are quite a few of these, a hangover from Empire, and it is time to review to what extent their existence is in the UK’s interest. For each Protectorate we should ask the question:
– Are we able to protect the territory? If not, give it independence and cease to pretend to protect it.
– If we are able to protect it, is the territory paying its fair share of the UK’s defence costs? If not, it should pay more and tax its citizens more to finance these costs.
I think that once we have had this review, many non-dom locations will prove to be less attractive to the super rich.
August 21, 2019
You are confusing Residence and Domicile. The NonDom rules are really about people living in the UK but who came from overseas (or sometimes were born to overseas parents while in the UK). These are (for a limited time) allowed to pay taxes only on UK income rather than worldwide income (but they also have to pay the NonDom tax on top of these taxes).
Why would a rich person come to the UK to take up a job if in doing so they have to pay more in total taxes to the UK than the amount they will be earning otherwise?
The attacks on the NonDoms by Osborne continued by Hammond was a spectacular own goal by these fools.
August 20, 2019
Non doms are a problem.
Many do not pay their share. Many play the system. And this is what makes it unfair.
My family are lucky. We are firmly in the 1%. We pay a lot of tax.
But we do not play the system. We know tax is a duty. We know it is for the greater good. We could pay less by setting up fancy trusts, keeping money in tax havens or by playing the system. We don’t. We abide by both the letter and the spirit of the law. And yet many non doms don’t.
The UK approach should be straightforward. Our tax system should be simplified. Non doms should not be able to use complex rules to avoid paying their share. And if they do not pay tax here we should make sure they cannot vote here. And that they cannot sit in the Lords. And that they cannot donate to political parties.
Most importantly we need tax and earnings transparency. There should be a full and open public register of how much everybody earns and how mush tax they pay. This would quickly shame many non doms. Those who want to take their money abroad – fine. Good riddance. Don’t come back.
End pay secrecy and you quickly solve these problems.
August 21, 2019
Andy
You have no idea what a Non Dom is have you ? You clearly have no idea what the tax rules are on Non Doms
Your cunning plan of tax reporting would have absolutely no effect on a non dom, and if you knew what a non dom was you’d know why
If youre rich Andy its only because Daddy gave you the money
August 21, 2019
Possibly one of the overpaid lefties working at the BBC?
August 20, 2019
I think less people are jealous of the ‘rich’ as might be thought. Far more people dislike things like lack of level playing fields, people seemingly benefiting by not ‘playing to the rules’ and the small number of business bosses who seem to dodge their corporate responsibilities to for example their pensioners whilst making sure through (legal) means that they personally benefit very nicely. Or poorly government contracts giving a win without risk…
August 20, 2019
Encouraging super rich non doms to live here, is like getting your wealthy grandma to move in with you so you can fleece her for the household bills! Far better to cut public spending in profligate areas of the budget eg absurdly high wages and pensions to senior local government officers, and the police too etc.
A economy that is investing quantitatively and qualitatively, should produce more than enough tax revenue.
August 20, 2019
In 1972 the US Economist Arthur Laffer proposed that government could increase its total tax revenue by reducing the income tax rates for all. In the 1980s the British government bravely adopted this theory and were proven right as they slashed income tax rates for all and the total tax receipt increased. So the Laffer curve works and the British government were proven correct. We need to remain mindful of this if we want to be a low tax and wealthy country
August 20, 2019
Correct Paul.
Another example is the deliberate policy of greatly increasing tax rates on tobacco products to reduce use and this policy led to reduced revenues.
August 21, 2019
but there will be a great saving for GPs and the NHS.
August 22, 2019
Well yes.
But you miss the point.
The Laffer theory says there is an optimal point for tax rates to maximise revenue.
Go beyond that point and people alter their behaviour and revenue falls.
The taxing of tobacco is designed to do just that.
Yet some people refuse to accept this theory.
August 22, 2019
[…] article was first published in Sir John Redwood’s Diaries (see here) and we re-publish with his kind […]