Now is not the time for tax rises. Now is the time to promote a vigorous recovery as soon as it is safe to do so. Yes, the deficit is far too large, but it is affordable as long as it is a one-off.
The deficit is the product of sensible support for individuals and businesses when they were locked out or closed down, and it was sensible support for the economy as a whole at a time when tax revenues had fallen sharply because people were not allowed to go to work and businesses were not allowed to trade. The way out of all that is not tax rises that would sap confidence and undermine business cash flows even more. The way out is a vigorous recovery that will replace lost revenues, and reduce the need for the support that the Government have rightly produced for small businesses and individuals.
What businesses and individuals will need is turnover, orders and work. I ask all Government Departments—led, probably, by the Department for Business, Energy and Industrial Strategy—to look at how the UK Government can make more work available. The Government have mighty procurement programmes, so when we are building great new railway lines, let us ensure that it is UK steel for the tracks and that it is UK-produced trains with plenty of components and value added, as well as the assembly work taking place in the United Kingdom.
As the Department for Environment, Food and Rural Affairs designs new grants and loans schemes, it should be promoting British food and agriculture at the same time as taking care of environmental concerns. There is a great opportunity to reduce the amount of imported food and to substitute Great British food from our farms and fishing grounds.
BEIS itself leads on energy. Why are we importing so much energy through interconnectors? Can we not have another round of capacity procurement so that we have future electricity generation here in Britain? We have plenty of means of generating power; surely we can harness that.
The Government should want to greatly expand the electricity output of this country because they want to unleash on us a great electric revolution in transport, space heating and powering our factories, so let us make the provision early. Let us invest now for the future so that we have that electric power when it comes to be needed.
A number of businesses have been very badly damaged by lockdown and shut-out, and I am glad that the Government are making some money available to them. I urge them to be generous. It was not those businesses’ fault and we need them to be there when we have recovery.
Small businesses and the self-employed are mightily flexible, but they cannot survive on thin air, and they will need to repay their debts, so give them some turnover and some tax cuts.
February 24, 2021
Right on every point, SJR.
Grow food on our farms. No more ‘rewilding’. Wildlife is important, but we can’t eat thistles.
February 24, 2021
Of course you can eat thistles as artichokes. Small thistles are are rather a hassle to de-choke though. Stems quite nice too.
February 24, 2021
The deficit was a product of a catastrophic decision made by the Fake Tory govt to unnecessarily lock down the country when its own pandemic report published last year before the lock down stated not to do so as did the WHO pandemic plan in 2019!
China suggested lockdown and WHO complied along with the UK! Moronic Self destructing economic harm to say the least, the govt not even following its own advice on pandemics.
School children being forced to wear masks in school when the quality of masks is not compulsory or of a recognised standard to be of any use whatsoever! JR, could you explain this decision other than child abuse or causing fear to be compliant with further govt rules? Please read the latest Danish study on wearing masks.
February 24, 2021
JR, Perhaps you ought to have started by questioning the totally unreliable death figures produced by the govt. Ann Widdecombe in her article is clear the death figures are not accurate and govt has shot themselves in the foot. If we cannot believe the basics on what the govt rely on to scare people into compliance the rest is pure rot.
There is now a growing number of relatives who are speaking out that their loved ones, even in care homes, are dying from completely different causes but have Chinese virus written on their death certificate. For example, Widdicombe cites an elderly person dying in a care home from fall injuries. But because she had a Chinese virus test, not positive, within 28 days it counted!
It is going to be very hard to justify destroying hundreds of thousands of businesses and jobs and wrecking the economy based on lies and inaccurate figures, do you agree? Unemployment at 1.75 million before furlough ends.
February 24, 2021
Bill B-
“Grow food on our farms” becoming increasingly difficult with the ongoing concreting over of massive areas of farmland for even more consumers necessitating even more importation of food.
February 24, 2021
Increases in general taxation would be unhelpful, yes.
However – a one-off wealth tax would not harm economic activity, and only affect those who would not even feel it.
You can only eat three meals a day and sleep in one bed at a time for goodness’ sake.
Even a few Tories get this.
February 25, 2021
A one off wealth tax would be a disaster, as would any further tax increases from the current position of the highest taxes for 70 years. This combined with very poor public services too. It would destroy confidence and move jobs and investments overseas.
You surely miss the point any transfer of wealth from the people who use and invest it well to government who generally piss it down the drain (often doing positive harm) is hugely damaging to the economy. This especially when we are so hugely over taxes already. Anyway existing taxes (income tax, cgt, stamp duty, NIx2, fuel duties, landfill, VAT, council tax, Inheritance Tax etc.) can already steal 90%+ of your wealth off you over just a few tears.
How would you ensure it was a one off no senible would trust the government on this? Income tax was first implemented by William Pitt the Younger in his budget of December 1798 in preparation for the Napoleonic Wars as a “temporary” measure.
February 24, 2021
Exactly, nor is it a time to burden the productive with even more red tape, green craps, judges attacks on the gig economy, landlords licensing etc, the self employed, data processing fees and hassle and the likes.
Sunak seems like a clear Socialist to me he did read PPE Oxon after all. His first act was idiotically to cut CGT entrepreneurs tax relief by 90%. He has not removed the landlord and tenant taxes that tax non existent “profits” from the Dire Osborne. He is set to increase corporation tax and stamp duty by £15k in June it seems. He has not even cut HS2 yet, he seems to favour of all the insane climate alarmist expensive energy agenda and shows no desire to cut endless waste in the state sector. About £18 billion on soft student loans for mainly worthless degree for example. Most of the civil service does more harm than good. Schools, the BBC and the NHS should be open to free and fair competition.
It is essential to cut taxes and also to cut the vast government waste. No sigh of this at all and they are lumping expensive intermittent energy and the war against plant food, the counterproductive lockdown and extra red tape on us every singe day too.
Damn fools and with the next election perhaps only just over 3 years away.
February 24, 2021
That high court attack on the gig economy merely levelled the playing field @LL
Uber avoided VAT, employment taxes, holiday pay and pension payments that an employer would have had to charge (VAT) incur (employment costs).
We can argue about the validity of VAT and employment costs but any operator should face the same hurdles, even a (n ex) disruptor.
February 24, 2021
Fine change the tax laws where this needed but what they have done is very damaging, negative for drivers, passengers and the gig economy in general. Good for lazy drivers and lawyers perhaps. There will also be fewer jobs for taxis drivers in general as fewer customers will be able to afford them.
February 24, 2021
Sir John Now is not the time for tax rises. Now is the time to promote a vigorous recovery Agree big time.
The sneaking suspicion I have, is that this Government spends to much time on agendas that have nothing to do with creating a thriving affordable economy. The focus appears to be on WOK-ish social media speak then devoting energy and our taxpayer money to those. Hence their need to take more in tax so they can spend our money on frivolous personal asperations.
The point missed, if a landscape is in the ‘first’ instance created for a single minded strong economy then they would then have the money and no one will pay much attention to spending on personal peccadillos. Its called ‘house keeping budgeting'( I believe Margaret Thatcher got there first on that) you first have to ‘earn’ before you spend, especially as now it is not their personal money its the taxpayers.
We have to be suspicious of those that ‘sold’ UK enterprise and industry out in an un-equitable arrangement with the EU. We never got Brexit we got surrender, now the intention appears to be destroy the last bit of the economy, so that the UK will always be held hostage.
February 24, 2021
Ian – it’s all a bit odd these inequitable arrangements. For example, I read “2 days ago — James Martin on his fishing exports nightmare: ‘I’m struggling to get scallops”. Yet the Scots are saying they are struggling to get their fish and scallops into Europe. The EU banned our scallops is there really no purification plant in the UK that could sort out the purification of UK scallops for our own market for Mr Martin?
Why didn’t Boris insist on a level playing field, stop importing EU products, Iceland have already said they could provide 80% of our fish needs willingly.
February 24, 2021
@A-TRACY, it gets wierder supermarkets import the majority of their fish for some reason they ignore UK stocks. It was reported that when Rick Stein became aware of a Scots shell fish exporter having problems so he reached out and offered to buy stocks from them, he had a use for quite a lot through a new venture. The most they could supply amounted just 1 tenth of his requirement
February 24, 2021
I quite like Kwasi Kwarteng, he seems quite sound and fairly bright but it is very clear he knows almost nothing about energy or energy engineering. Just as the rather less bright & sound Grant Shapps at transport who even seems to think electric cars save significant CO2 and are “zero emission” when they clearly do not.
They need to mug up. Get Lords Lilley, Ridley and Lawson to educate them in the realities of Climate, Energy Economics and Energy Engineering.
February 24, 2021
HS2 is clearly a disaster in CO2 and economic terms too. Cancel now please.
February 24, 2021
Yes to all that with an emphasis on self sufficiency in viably food production and home produced power. In the latter there is great home potential.
As you infer we can live with the defecit at the low rates government pay for money. So let us create a fiscal situation dedicated to the generation of individual and national wealth on such a scale that even at the reduced rates of taxation I advocate would in fact increase the flow into the treasury.
Rebalance the economy. The public sector have fed well and pension provisioned well during this lockdown. With the exception of the NHS, the police and security services, the fire services, and the military, the public sector has fared well while the private sector has suffered greatly. There should be no governmental, national or local, contribution to public sector pensions for the next two years. The saving should be used to reduce the national tax burden and the rate burden directly.
Taxation requires reformation in terms of overall amount, in terms of where it is applied, and interms of its complexity. The Chancellor must create a seedbed for wealth creation if for no other reason than to fund the services most of us consider essential in a civilized society.
February 24, 2021
It is you who should be PM John, not the hopeless Boris Johnson.
February 24, 2021
It would certainly be far better if Boris took JR’s advice rather than that of the mother of his latest child with the THEATRE STUDIES degree and Libdim, at best, views.
February 24, 2021
Do you suppose that in responding appropriately to this Covid business the Government might actually begin to do all the things it should have been doing anyway to take full advantage of our liberation from the Evil Empire as delivered through Brexit?
(I know whatever is done will be muted, because of the secret protocol to the agreements with the Evil Empire that requires we do not actually use the freedoms we have. (I do not actually know if this protocol exists of course (as that is a secret) but the other explanation is that the Government is complacent, idle, timid, incapable, useless, unimaginative and not fit for purpose.))
February 25, 2021
As demonstrated by the two month extension given to the EU apparently without sucking through our teeth and stating “It’s gonna cost you mate”.
February 24, 2021
I very much agree we should grow more food on our farms. The trouble is, all the farms round here are going under identikit housing estates. And I live in prime agricultural territory.
February 24, 2021
Barbara, same where I am in Shropshire and don’t even mention Sussex. Their only saving grace now is the protected south Downs.
February 24, 2021
The future is self sufficiency as you say.
One of the reasons it is too costly to be self sufficient is the cost of government and the need to recoup this through taxes (on income, on employment on land sales and on consumption).
Smaller government is one big step on the way to self sufficiency (land value and the cost of housing is another).
February 24, 2021
@smaller – agreed. Smaller and a modern democratic government, followed by a smaller state. With anyone receiving taxpayer renumeration required to be transparent and held to account
February 24, 2021
Sadly, the culture and structure of UK government is unsuitable for the task you describe JR. Classically demonstrated again today by another Punch and Judy PMQ session. It needs a Cabinet of proven technical ability, appointed by an elected PM, from outside of the elected laity that forms the legislature. … Discuss.
February 24, 2021
acorn isn’t that what spads are? People with technical ability from outside the ordinary members of parliament.
February 24, 2021
Sir John, these are all fine comments (although I am disappointed you did not press for ‘full expensing’ for capital and R&D investment), but are, essentially, what you have been saying for some months. You need to keep repeating yourself because the government isn’t listening to you and acting on your advice. How long are you willing to be ignored and to see the government do the wrong thing? If the Chancellor raises corporation tax in the budget, willl you vote against it?
February 24, 2021
The tatty way our MsM informs or more correctly misinforms the country is still running riot to day with reports of Western Countries over ordering the vaccine therefore denying the rest of the World a share.
The reality was the orders were placed here there and everywhere for a product no one knew could possible turn up, be invented or be produced. It is called covering bases, no one over ordered, just no on knew what was possible and from were it would come. The MsM in making out the UK and others were being selfish is the MsM trying to tear down society.
I suppose if the MsM told the truth and laid out the facts they would not have a story to print.
February 24, 2021
If I read the numbers correctly (and I could be wrong), about 40%+ of the workforce are now engaged on the public purse. Most, if not all, are on gold-plated pensions and thus a huge drag on the public who pay for them.
It makes tex rises inevitable, the State has to be able to keep them on board, despite the fact that so many of them have nothing to do with the essential productivity needed to get the country anywhere near to a balanced budget – not that any government has managed to achieve that since the Napoleanic wars!
February 24, 2021
You have read correctly, in the same view it is just 40% that contribute positively in tax.
February 24, 2021
Sorry , this should be with the vaccine piece.
February 24, 2021
Yes, we should aim to build British railways – and much else – with British steel, but there are two ways to do that. The right way is to encourage an efficient and competitive British steel industry with innovation and investment. The wrong way is to allow steel companies in the UK to lobby their way to taxpayer subsidies and preferred bidding that make them only appear to be competitive.
February 24, 2021
@Jon, can you name a UK owned steel works. I cant
February 24, 2021
I’m not convinced about the tax argument, I believe an annual asset (eg property) wealth tax on personal assets over a specific value will not impact on companies expanding or indeed 99% of people.
I’m not convinced that individuals (the 1%) provide personal wealth for the benefit of economic activity – such wealth is usually amassed over seas for personal use.
I note from the news the Bank of England states the EU is making significant gains from London and this is set to continue.
February 24, 2021
We need to be out of lockdown urgently.
One senses that this is no longer about saving the NHS but saving the Government.
Infection counting is redundant now. It must be switched to hospital admissions *because of CV-19* and as soon as that is low get the country back to normal.
Bearing in mind we took 30,000 deaths per annum with flu (and no-one dies of flu now) that figure for CV-19 should be acceptable to get us out of lockdown.
February 24, 2021
It is of note the EU have yet again delayed approving the Brexit trade agreement until 1st April 2021. While at the same time trying to stop EU finance houses by means of new laws trading with London.
They haven’t finished yet on their desire to punish
February 24, 2021
From the MsM, relating the to the Irish Protocol
The EU response – The Government should have listened intently as Maros Sefcovic explained the solution to problems with goods flowing from GB-NI was for companies in Northern Ireland to source their goods from within the European Union.