Of course most of the tax revenue needed has to be paid by the rich and the better off. The art of taxation is to set rates that maximise revenue without killing enterprise and forcing out the wealthy.
You do not make the poor rich by making the rich poor. If you try to tax the rich too much you drive them abroad. They do not have to stay to pay. They do not have to pay to play here when there are plenty of lower taxed places to go. They also have the option of paying more to hire better defences against a predatory state.
The current Chancellor inherited taxes that were already high as a result of the over spending and fall in tax revenues brought on by the covid lockdowns. She was warned upping the rates would be damaging. She ignored the advice and now watches in horror as the billionaires and the millionaires flee the country in increasing numbers.
The Office of Budget Responsibility is poor at forecasting revenues. It often underestimates the negative effects of high rates on revenues and exaggerates the revenue likely to accrue from higher rates. Even the OBR will have to tell the Chancellor before her next budget the bad news that higher wealth taxes have driven away too many better off people, and higher National Insurance has destroyed jobs and business profits. As a result higher NI has reduced income and business tax revenue.
If the Chancellor wants to raise more revenue she needs to do a U turn on her tax rises last time. She needs to ask herself why Ireland has been raising four times as much business tax per head as the UK with a much lower rate.
June 29, 2025
Robin Hood economics is doom loop economics especially when from the current, hugely overtaxed position. And with the insanities of the workers rights bill and net zero rip off energy on top.
“They also have the option of paying more to hire better defences against a predatory state.”. Indeed increasing essentially parasitic activity of tax lawyers, tax accountant, expensive tax structures and of course the black economy. Rendering the country with even lower productivity.
“The current Chancellor inherited taxes that were already high as a result of the over spending and fall in tax revenues brought on by the covid lockdowns.” Well actually as a result of the insanity of net harm tax payer funded economic lockdowns and the coercing net harm vaccines into people (even those who were at no risk from covid and or had had Covid already). The unsafe and ineffective and for most not needed even had they been effective and safe – well done Sunak, Boris, the government “experts” the big Pharma funded vaccine regulator experts. How are the criminal investigation coming on? Has Sunak even corrected his unequivocal misleading of the house yet?
June 29, 2025
So now we are to get (from Two Toer Free Gear Kier) a two tier benefit system. Those who already have PIP or apply quickly and those who apply only after the new rules apply. Surely we will get legal challenges to this blatant two tier discrimination?
June 29, 2025
It’s an obvious disincentive to get off PIP and try working: if the job doesn’t work out and you need to reapply for PIP, you will get a lower level of payment.
So why take the risk?
The numpties who come up with these ideas simply don’t understand people – or the vulnerability of their situation.
June 29, 2025
Indeed to be a socialist you surely have to have a basic inability to understand human nature. An inability to grasp logic, a bitter sense of envy, a hatred of landlords, employers, private schools users and a huge chip on their shoulders seems to accompany this rather often. An irrational belief in climate alarmist very often and even vile antisemitism in a fair proportion as we see with so much of the Labour Party and the BBC.
But their failure to understand basic human nature is the uniting feature. Why else would Healey have given us 98% income tax did he actually think this would raise tax? But then Osborne gave us more than 100% taxes on some landlords by preventing them deducting their interest costs and on CGT without indexation. The Tories stuffed full of deluded socialist too!
June 29, 2025
Denis Healey, a double first in Greats, Balliol and yet despite this “intelligence” he thought 98% income tax was a grand idea!
June 29, 2025
LL :
Socialism depends upon making and keeping people poor. To make matters worse we now have a Civil Service, judiciary and PM who believe in international (human rights) law and hence no longer believe in nationhood and consequently the need for borders. They believe that anyone has the rght to live in our country and be allowed to follow their own customs, practices, religions and laws and our anti-democratic human rights legislation is specifically designed to protect them from the will of the majority.
June 29, 2025
No relief on interest – why should the taxpayer subsidise your business because you choose to borrow more than you can afford to run it.
June 29, 2025
to LL…..
and many 98% tax payers like pop stars raised two fingers and said we’re off to France or wherever. Tax take? Sod all!
June 29, 2025
@ Dixi
Because if you tax a business on “profits” it has not made it eventually just goes bust and clearly will stops investing. It is not a “subsidy” in any sense at all. All businesses get relief on interest on borrowings to buy assets for the business be they trucks, aircraft, plant…why else would they buy the assets. It is actually double taxation as the landlord is taxed on it then they pay it over to the bank and the bank pays tax on it too.
June 30, 2025
@LL
So subsidies are only bad when you don’t receive them.
It is not about taxing profits, you pay interest because you have chosen to borrow money because you are spending more than you have accumulated – again why should the taxpayer who does not enjoy such benefits subsidise you.
July 2, 2025
@ Dixi it is not a “subsidy” just normal income tax on profits after costs, if you do not allow interest like all other businesses as deductions you are taxing “profits” that have not even been made! It his tenants too.
June 29, 2025
People who work can still receive PIP. PIP is not a means-tested benefit, and there lies one of the problems. A wealthy person can be driving around in a state-funded mobility car subsidised by the struggling, hard-working young family. The whole disability system needs reforming. The key question is, what is this money for? What extra expenses does a sick or disabled person incur? Can services, rather than financial help, be offered? We need to concentrate our help on the severely disabled, those who need constant care. Politicians need to act with their heads, not their hearts. They react from emotion and ignorance, rather than common sense. This is why this country is in such a mess, and badly needed reform never happens.
June 29, 2025
I have a friend whose husband has genuine severe mobility issues partly caused by age / general health and partly following an industrial injury which his employer refused to acknowledge.
They now have a Motability car …. along with the one they still own. And when they got the Motability car, they sold the other one they owned and pocketed the money.
June 29, 2025
PIP is not related to employment but is concerned with daily living and mobility aspects of disability. It is also a criterion used by other agencies that an individual is disabled, eg with vulnerable beneficiaries of trusts etc. The usual government sledgehammer approach will surely damage the situation for many who are legitimately disabled and in need of support because of lazy civil servants.
What extra expenses does a sick or disabled person incur? – modifications to a home, assistance with medications and/or diet access to public services, transport, employment support – so they can work or volunteer, simply getting out of the house and meeting other humans can need support, all of which has become increasingly expensive.
For many this support comes from family, who are not paid and then cannot work as much or at all depending on the needs of the disabled individual. Where paid support is involved these tend to be lower paid occupations and quite often the supporter is themselves a carer.
The general public is mostly ignorant, often wilfully so of this unpleasant reality and would rather not be bothered with it, instead focus on their four holidays abroad a year and car collections.
June 29, 2025
Lifelogic
We already have a two tier basic State Pension system, it is higher if you retired after 2015
In 2027 we will then have a two tier inheritance tax system for those with SIPP, Self Invested Personal Pension funds as yet unspent, when retrospective taxation to a lifetimes planning will come into force.
Shamefully Legal theft seems to be the way forward for this Government.
If I were younger I would now be seriously looking to live elsewhere.
June 29, 2025
Italy is currently popular with high-net-worth individuals transferring their tax residence to Italy are enabled to apply a substitute tax to their foreign income, amounting to 100,000 Euro for each fiscal year. The regime may be extended to family members (€25,000 per member).
This as starmer, Reeves Ed and the workers rights lunacy drive them out of the UK with the attacks on private schools, non doms and the rich.
June 30, 2025
“Claimed they inherited too much spending and borrowing, only to make very large increases in both”
Well they certainly did inherit a vast increase in public debt mainly spent/wasted by Sunak and Boris on net harm lockdowns, net harm vaccines, large open door immigration, HS2, the insanity of Net Zero but yes they are still making it even worse!
June 29, 2025
All very true. You should add the IFS to the list of advisors who do not have a clue on this topic. It is not just the multi millionaires and their taxes that are lost. It is also their investable risk capital which is lost to the UK.
June 29, 2025
Quite so, people vote with their feet. Here’s a chart demonstrating how appalling our national management is and has been over the last 10 years and why we are unlikely to be able to raise adequate tax to cover expenses, the number of companies traded on the London Stock Exchange:
https://www.statista.com/statistics/324547/uk-number-of-companies-lse/
PS, can the BBC be prosecuted for broadcasting a concert where there was clear ‘incitement to violence’?
June 29, 2025
The guilty parties should have been arrested, held over night, black van’d to court in the morning and sentenced to minimum a year in jail!
June 29, 2025
The best way to run and economy is surely to encourage productive activity, get out of their way and deter essentially parasitic ones, to encourage inward investment and deter wealthy and hard working people from leaving, to regulate as little as possible and let the productive produce. Alas two Tier and Reeves have the reverse agenda and then Milibrain dumps the net zero, rip off, intermittent energy lunacy on them and Rayner’s insanity of the workers rights bill too. Pure counterproductive economic vandalism.
Giving good workers the “right” to carry the incompetent and lazy workers who cannot be easily be fired. Entirely counterproductive for all but the shirkers and the lawyers!
June 29, 2025
+1
June 29, 2025
“Of course most of the tax revenue needed has to be paid by the rich and the better off.”. Well even with flat rate taxes these rich and high earning will pay far more than the poor and low earners.
As I have pointed out before current taxes income up to 45%, Stamp duty up to 15%, CT 25%, fuel duty up to 60%, VAT 20%, CGT 28%, IHT 40% can very easily leach 90% of your capital off you in say 20 years. You need a return of circa 10% per annum just to keep your wealth in line with inflation after tax making nothing. Also on top of these taxes you have large tax compliance costs and associated risks.
If taxes were at a sensible level say 20% of GDP (what would then be a far larger GDP) then perhaps we could avoid the absurdly high tax rates that deter investment into the UK. Tax, in and of itself, is a huge drag on the economy deterring investment, encouraging the black market and bartering, taking money of people who invest it well and giving it to people who usually do not.
June 29, 2025
IPT insurance tax 12%, council taxes, licence fees, road taxes, landfill taxes, carbon taxes, motorist mugging taxes… too.
June 29, 2025
Servicing the interest on the national debt, now at £2.4 TRILLION, is severely constraining what Reeves can do to reduce tax. Sunak, who printed more money than any Chancellor in history, also had trouble finding the £100 million or necessary to pay the interest.
The whole world is wallowing in debt. The sums involved are so huge it cannot be paid down. Two things look likely – one, taxes will continue to rise to pay the extra interest the bond vigilantes demand in compensation for the higher risk of default. And second, global government spending cuts are inevitable, with the enhanced risk of social unrest.
Farage, Tice and Reform would rapidly bankrupt the nation with their Corbyn economics
Reply Interest on debt is £100 billion, not million!
June 29, 2025
To reduce this, get inflation down reducing interest rates and stop borrowing money to waste on things like net zero and Chagos. Either that or default on these and offer them 20% over 30 years is this the Labour plan?
June 29, 2025
20% 20p for the £1 that is. Making each UK household about £80,000 better off in debt terms anyway! Unless they were the ones taking the haircut!
June 29, 2025
So it’s not sensible to:
* drive away the wealthy who pay the most tax.
* overtax SMEs so they cannot afford to expand or innovate
* load the economy with the most expensive energy in the world; destroy whole industries and lose the tax revenue we’d get from accessing our own natural energy reserves (gas, oil, shale and coal).
* import millions of low-wage immigrants who will, over their lifetimes, NEVER make a real contribution and will import their extended families
* pay £billions in rent for property we already own
* create more Quangos, stuffed with unproductive bureaucrats further complicating a governance system which is already massively over-complicated
The Not-a-Conservative-Party had already ruined the economy. Everything this appalling Government has done has made the situation worse.
June 29, 2025
+1
June 30, 2025
@Sir John
My apologies for the obvious £100milllion typo
June 29, 2025
It’s not just the penal tax rates that have people leaving. L9ndon was a vibrant city which offered a good lifestyle for the rich. Now with the present incumbent as Mayor it has become a ghettoised, crime ridden slum
The constant war on the motorist and the explosion of pretty crime is also a factor.
Cities in the Middle and Far East offer a safer and more friendly welcome usually with better weather.
With Net Stupid and other policies this and the previous government have destroyed the very fabric of the country.
June 29, 2025
Socialism UK style is a terminal illness. It is just a matter of awaiting the demise. I would add that all parties in the HoC bar one are infected so we await the great reset in 2029 or possibly earlier.
June 29, 2025
” If the Chancellor wants to raise more revenue she needs to do a U turn on her tax rises last time”
Do a you U-turn !! This government !! Surely not ……………
June 29, 2025
If you want to know one reason why people are leaving this country, there is an excellent article by Richard North in todays Conservative Woman regarding Bradford. A must read cataloguing the decline of Britain.
June 29, 2025
Indeed. Of course, as Lord Hermer puts it, it is “disgusting” to suggest there is anything remotely “two tier” about this government, the blob, Kier, the police, social services, the judges, the hate crime laws, the sentencing council, the local authorities, the appalling UK press, internet and tv regulators… disgusting despite the fact that it self evidently obviously true.
See also the excellent – Britain Will Fall Unless We Act! David Starkey
Talks video.
June 29, 2025
Farage is “A Wolf in Wall St clothing” says Two Tier. Does he write this meaningless drivel himself? Does he even bother to read it before delivery? The man is obsessed by Farage, but alas not by Farage’s many sensible policies like ditching net zero, taking advantage of Brexit rather than reversing it, ditching his Chagos lunacy, getting energy costs down hugely, ditching his workers rights bill, cutting taxes on jobs, road blocking, heatpump and EV market rigging, stopping his policies of driving out investment, high energy industries and the rich…
June 29, 2025
“stopping” road blocking etc. I meant!
June 29, 2025
Now who in their right mind would vote for such disastrous policies?
Answer on a postcard to 10 Downing St, and even better to number 11.
June 29, 2025
Sir John, I suspect you give Reeves too much credit. You think she has a working brain aligned with economic awareness.
Sadly she thinks the Laffer curve is a tennis stroke perfected by Roger Federer. She also thinks computer models are fool proof, thus when the OBR give her a forecast she imagines it will be the real outcome. Unfortunately the scale of the fools in office are beyond the computer models capacity to accommodate them.
June 29, 2025
Rod, as I have said many times on here before, many politicians do not seem to understand the effect of Human Nature and their thinking when inventing their theories and policies., which is why so many policies end up producing a very different result to what they expect.
June 29, 2025
It would be interesting to know how many senior policy wonks at the Treasury are “on the spectrum” since they appear to have very little understanding of normal human behaviour and how people assess, and react to, incentives/disincentives
June 29, 2025
One thing that seems to be a bit different this time, compared with previous ‘Brain drains’, is the much more comprehensive information on the numbers going, and their worth. It will be interesting to see if the OBR has anything add to this, and whether changes the reaction of the Government in Amy way.
June 29, 2025
The Labour Party is motivated by the politics of envy. They don’t want there to be a huge divide in rich and poor, so they think taxing the rich to give to the poor will solve the problem. However, the inequality continues because they don’t tax multi-nationals equally and permit their tax loop-holes, because they want the foreign investment.
All they do is stifle aspiration and enterprise of the UK population. Why bust a gut when your efforts will just be taxed away?
Government should be there to promote the individual to start and run successful businesses for the goodwill of those who make the effort. Our government just wants them to be successful so they can tax them more to spend on their priorities. They just don’t understand human nature.
June 29, 2025
The term:
fully encapsulates the behaviour of this government – certainly they are not doing any of this hyper-taxation for our benefit, with so much of our money going abroad or wasted on vanity projects.
Why does HMG think it is acceptable to rob one area of society to give another group an easier ride:
– HMG intend that a lot of big companies using a lot of energy will get a reduced rate, subsidised by the rest of us;
– HMG intend that where labour councils that fail to balance their books they will be subsidised by councils that can.
This is not just rewarding down statistics with garbage socialist dogma, it is morally wrong, demonstrating how unfit for purpose this government is.
June 29, 2025
Sir John
“Of course, most of the tax revenue needed has to be paid by the rich and the better off” – Why?
If tax is being paid to fund the services, the safety and the security that everyone enjoys why shouldn’t every one pay an equal share? Quite naturally some one on £1,000 pays more than someone on £500 per week, without even having different tax rates, why then should those being more productive in their own way pay proportionally higher than those that aren’t? We all share the same benefits. Socialist WOKE entitlement comes to mind. – you get to take but never contribute
Many years ago, Steve Wozniak, one of the founders of Apple Computers was able to demonstrate that if everyone paid around only 2.5% tax (I have forgotten the actual amount but it was ridiculously low) the tax take would be greater. He was of course referring to the USA. But it transfers in the same way to the UK.
As has been stated on these pages recently the top 1% of earners paid 28% of the tax taken by the Government, with the top 10% paying 60% of the total tax take, with 35% not paying anything. Leaving 55% of the working population receiving more out than is paid by them. Or in other words 90% (55% + 35%) of the Country feeds of just 10%.
The UK’s convoluted tax system requires allowances, subsidies and grants to address the imbalances created in one sector or another, the result is an expensive over burdening administration that wouldn’t be there if everyone was treated equal.
June 29, 2025
There is concern in some quarters that people are leaving the country due to the taxes imposed. Yes, it is true but the reasoning being deduced is wrong. Political ideology or as we have now ‘terrorism’ dictates that you drive out those that don’t support you. Look at London, in a short space of time it has become a Marxist enclave, a foreign land – but it will always no vote for the same leadership.
June 29, 2025
The real point being that in creating the Socialist WOKE World of entitlement without ‘anyone’ contributing may get you elected in the short term but how is it funded tomorrow?
June 29, 2025
Net Zero is reverse Robin Hood economics. The poor are subsidising the wealthy to pay for their subsidies for expensive evs and heat pumps and solar/battery systems to protect them from the inevitable rolling blackouts (but only in summer). In order to make electricity cheaper than gas the latest trick planned is to transfer all the electricity subsidies onto gas and hence increase the energy costs of the poor whilst reducng them for the rich.
June 29, 2025
Precisely. The same applies to EVs.
June 29, 2025
This Government and their predecessors have created a doom loop of their own personal ‘tax’ addiction. Tax in itself long-term buys nothing other than elections, even that is an illusion, remember Jeremy Hunt (remember him) put taxes up so that he could reduce them in the run up to the election, how did that work out? Rachael Reeves appears to be a Jeremy Hunt disciple, a me-too candidate.
What successive governments have failed to recognise is that a ‘budget’ is just that, it is managing ‘expenditure’ against actual earnings. Tax is not earnings; it is the productivity of the Nation that is earnings. The way to have more to spend is for the country to be on an equal footing with the competitive world, something successive governments have fought against.
UK Governments their Legislators prefer fighting the nation its people, especially if the believe that promotes personal self-esteem, political ideology and ego. The World doesn’t recognise this, those that work with tier nation and its people are pushing ahead further and faster
June 29, 2025
The PM might as well resign now because the entire world now knows he is weak and can be pushed around by
anybody. But if, as forecast, Angela Rayner is the favourite to succeed him, she will be evn worse.
This Labour Government has no idea how to encourage and support growth. It only knows how to increase taxes and every other cost to make people’s lives more difficult.
But the previous conservative governments were just as bad and bear responsibility for Labour winning the last GE.
A lot of our poorly educated and left-wing indoctrinated young people are going to learn a bitter lesson.
June 29, 2025
Does it always hold true that “Robin Hood economics ends in poverty”? Is there no escape clause if you say “black hole”, “first woman” and “growth” often enough?
June 29, 2025
Except for the current 4-year plan to get rid of petrol and diesel cars, this government only ever talks about 10-year plans so if they get kicked out in 4 year’s time they’ll simply say that they were not given enough time.
June 29, 2025
Perhaps Robin Hood’s analogy is wrong as they take off the poor to fund the lazy and non Dom’s.
June 29, 2025
Look if you can at the Daily Telegraph article today ” The suspended doctor selling sick notes on demand”. DT reporters’ investigations provide some, perhaps unsurprising, appalling facts and likely the tip of an iceberg.
A “rogue” online service offers certificates for months off work with no medical tests or consultation. Sick notes issued within hours of requests being made. A dossier of evidence has been shared with the GMC and the CQC. Just where is the regulation?
June 29, 2025
I fail to see anything, that isn’t taxed …..and a great many things with an added net-zero tax
June 29, 2025
I believe in rational politics but people are often emotional, stupid and irrational by nature.
People think they can get richer (or get better ‘services’) by taxing the rich more but fail to realise average work income (that includes the merely better paid as well as the rich) is only about 15% above the ‘median pay’ (the pay that has 50% getting more pay and 50% getting less pay). So even if contrary to reality the economic system would not break down with the desertion of well paid people (doctors, professors and the owners and organisers of businesses who might retire or move elsewhere) workers would only on average increase their income by 15% before tax by such measures – and that is without giving pensioners and the unemployed more money.
However people only really want what benefits them. They may want more income equality in our society but they certainly don’t want income equality with the rest of the world and they certainly don’t want to redistribute their money to make the billions of very poor people in India, China and the rest of the world less poor.
Nor do most people object to the inefficiencies,bureaucracies and blind following of intellectualist fashions (such as ever more education and qualifications and complex regulations) that governments are imposing on us that cause massive amounts of unnecessary work. That deprives us unnecessarily of very much of the limited time we have in life.
People are generally blind to the fact that they would benefit from governments prioritising more intelligent, more rational governance rather than from governments talking in terms of ‘a more equal society’.
June 29, 2025
“The Office of Budget Responsibility is poor at forecasting revenues.”
The OBR need to employ the economists who work at the CCC for their budget reports predict precisely the costs of everything necessary for our transition to be a net zero country by 2050 and preceisely by how much the cost of living will fall in our electrified utopia whilst at the same time of course unilaterally saving the planet.
June 30, 2025
Sounds like the Red flagged Labour Party of the 1960s and ’70s. They never learn. Their riposte is, well, socialism has not been tried properly before, we need to do it properly this time and get rid of these filthy capitalists once and for all. There is no such thing as a socialist paradise on earth, never has been and never will be.
It has been tried before many times. It always ( has bad -ed) results. etc
June 30, 2025
There is only one answer; Growth!
The real question is how?
Promoting Business Activity? And, I would say, reducing appropriate burdens (Taxes)?
Not, necessarily, in the short term, cutting Benefits?
Cut the State, and it’s Debt (Balance Books)! Yes, especially, as part of some cultural change, in the long term?
Reducing Regulation; And, promoting the Individual, and Free Enterprise?