Rishi Vows to Cut Taxes… Later

Away from the disaster in Ukraine, Rishi Sunak has today promised to cut taxes at some nebulous point in the future – just not now. Delivering the annual Mais lecture, Rishi ruled out the “false idea” that high government spending leads to growth, or that tax cuts can pay for themselves. Ignoring the possibility that with the tax burden at a 70-year high we might just be in the wrong place on the Laffer curve.

“I am going to deliver a lower tax economy but I am going to do so in a responsible way, and in a way that tackles our long-term challenges […] I am disheartened when I hear the flippant claim that ‘tax cuts always pay for themselves’. They do not. Cutting tax sustainably requires hard work, prioritisation and the willingness to make difficult and often unpopular arguments elsewhere.”

“Difficult and unpopular arguments” is a pretty obvious hint from Number 11 to Number 10: I can’t cut taxes unless we cut spending. Rishi’s position is, to paraphrase Saint Augustine, “Lord, let me cut taxes – just not yet.”

mdi-timer 24 February 2022 @ 13:47 24 Feb 2022 @ 13:47 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Midlands Industrial Council Boss to Boris: Get a Grip, Champion Low Taxes

Johnny Leavesley is not a household name outside his own household, although he’s far from being an insignificant character. He has an occasional column in the Telegraph, is a successful businessman, has been a Conservative Party treasurer and is currently chairman of the Midlands Industrial Council. Unlike the BBC’s “Tory Donor” who turned out to be a Labour Party donor, he’s the real deal. The Midlands Industrial Council, has for a long time, funnelled money from the business community into the Tory treasury. Their support over the years for the Tories has been worth millions.

Writing in the Telegraph this morning, he passes over Partygate to fire a warning shot about the ideological direction of the party:

I have been a party donor through bad times as well as good, but my enthusiasm can ebb and flow. The recent reiteration of intended NIC increases and the raising of Corporation Tax to 26% is regressive and disappointing. You don’t grow the economy, which pays for everything, by taxing it severely when it is vulnerable. It seems that our economic policy has been captured by the civil service. Have they never heard of the Laffer Curve? It is time for the government to act as a free enterprise champion and act Conservative. Get a grip Boris, or go.

This is a sentiment Guido hears all the time from true blue supporters. It is all very well changing the personnel and processes in Downing Street; many think a reorientation of the direction of travel is also needed. 

mdi-timer 11 February 2022 @ 12:15 11 Feb 2022 @ 12:15 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
China’s £61 Billion of Business Tax Cuts Put Sunak to Shame

China has announced it will cut business taxes by £61 billion over the next year to stimulate economic growth as it seeks to recover from the downturn caused by the pandemic. These plans are on top of cuts to VAT, pension insurance, and corporation tax implemented last year, which have now also been extended…

It should be a state of shame among Tories that the Chinese Communist Party now shows better understanding of pro-growth tax policies than the UK’s Conservative chancellor. China has reduced taxes and administrative fees by more than ¥2.6 trillion last year – a record high – coming after a ¥2.36 trillion tax slash in 2019. Of course, Rishi Sunak used to say the same thing. His budget corporation tax rises aren’t set to come in until 2023 – there’s still time to change course…

mdi-timer 6 April 2021 @ 13:45 6 Apr 2021 @ 13:45 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Boris Accidentally Announces Huge National Insurance Cut

Speaking to factory workers in Teesside, Boris accidentally let slip a Tory a major manifesto announcement that the Tories will increase the National Insurance threshold to £12,500 if they win the election. Finally, the Tories give us all a tax cut…

The policy clearly hadn’t meant to be blurted out, as subsequently his TV interviews had to be delayed while his team worked out how to address the self-exposed leak.

Guido hears the specifics of the policy will involve an immediate NI threshold raise to £9,500 next year, with the aim of £12,500 in the longer term – approximately a £400 tax cut for every worker. In simple terms that means some £3 billion staying in the pockets of millions of over-taxed voters in 2020…

mdi-timer 20 November 2019 @ 14:38 20 Nov 2019 @ 14:38 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Boris Scraps Corporation Tax Cuts

Following Guido’s reporting that Boris had scrapped reducing income tax in the budget that never was, and he’s scrapping the same income tax cuts in the forthcoming manifesto, Boris has just announced at the CBI he’s also scrapping his pledged corporation tax cuts that would have seen the rate fall from 19% to 17%. Boris is really taking liberties in the knowledge the Tories’ manifesto can’t be any worse than the last one, they’re still having a good go…

mdi-timer 18 November 2019 @ 11:10 18 Nov 2019 @ 11:10 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments