An EU-funded think tank is now pushing for a global minimum wealth tax of 2% as the “logical next step” after Sunak’s favourite global minimum corporation tax. The EU Tax Observatory gets €1.2 million annually directly from the EU and is run by high-tax ultra Gabriel Zucman who is obsessed with tax havens. It wants governments to initiate talks at the G20 summit in Brazil in November 2024. Wealth taxes were previously standard across Europe but were all scrapped because they failed…
Jacob Rees-Mogg led the charge against the minimum corporation tax this year and tells Guido “taxation is a national not a multi-national responsibility. The EU is always looking for ways to extend its powers and this is another example“. The difference between death and taxes is death doesn’t get worse every time the bureaucrats get together…
The ASI’s Duncan Simpson says that wealthy people obviously “don’t have piles of cash just sitting around” and would have to sell tied-down assets to pay the tax. Instead of doing that they “will simply leave, taking their money with them and ultimately reducing tax receipts“. Sunak will probably be interested…
New figures from the Office for National Statistics show that Public Sector New Borrowing in the first half of the financial year was up from last year but £20 billion lower than the OBR forecast back in March. Borrowing in September was also down £1.6 billion from 2022, though that’s still the sixth-highest since monthly records began in 1993. Seeing as OBR forecasts run economic policy, that means there’s a deal of wiggle room…
For all Hunt’s spinning over the inviability of tax rate reductions, the Treasury is hauling in unprecedentedly gargantuan amounts from stealth tax grabs. Economist Julian Jessop says there is clearly room for “some well-targeted tax cuts” in the Autumn Statement. Guido isn’t convinced that Hunt has got the message…
Bad news for fans of economic growth this week as the US-based Tax Foundation release their International Tax Competitiveness Index, which ranks 38 OECD countries on how pro-growth their tax systems are. The UK has dropped another 3 places from last year to reach 30th out of 38 in the rankings. Canada and Germany are well ahead at 15th and 18th places, as are the United States and Japan. The only silver lining – France and Italy are still below us…
The Tax Foundation’s analysis shows that the UK is competitive on cross-border tax rules but falls short on pretty much every other metric, with above-average top-rate income tax rates and the highest real property tax burden in the OECD. Sunak and Hunt’s corporation tax hike has pushed us down 17 places in that category. Tom Clougherty at the CPS notes that we’ve “gone from having the 4th lowest headline rate in the OECD to the 21st“. Hardly a prelude to growth…
Jeremy Hunt is continuing to fend off pressure to cut taxes at Tory Conference, claiming yesterday that they would “compromise” the fight against inflation. Left-wingers are known to argue that tax cuts are inflationary but the facts don’t bear out. Inflation is a monetary phenomenon.
When taxes are cut people will buy more goods and services at the already elevated prices. Meanwhile, wealthier families save the extra money to invest. Disposable income has not been shown to affect inflation. Even the £10 billion cost of living package had almost no effect.
Tax cuts that stimulate production, for example in corporation tax, will be anti-inflationary. As inflation is caused by a growing amount of money chasing a reducing amount of goods and services, then tax cuts that stimulate production will bring the level of inflation down by increasing supply. It’s basic economics… the main reason we don’t have tax cuts is because the government doesn’t want to cut spending.
Hunt’s team is attempting to argue in response to the news that it is responsible for the highest ever increase in the tax-to-GDP ratio that the government has “taken 3 million people out of paying tax altogether since 2010 through raising personal thresholds”. To highlight the LibDem’s finest coalition achievement shows how dire the Tory record is on taxation.
Unfortunately, the former chancellor Rishi Sunak’s decision to freeze both the personal allowance and the higher rate threshold in 2021 along with Hunt’s two-year extension will do more than enough to make up for the 3 million kept of tax in the 2010s. The OBR calculates that in 2024 an extra 3.3 million people will have been brought into paying tax than if the threshold and allowance were indexed. The now 6-year personal allowance freeze has lowered its real value to its 2013 level. And in return for paying the most tax ever we get such brilliant public services…
Following the Institute for Fiscal Studies’ damning report that this parliament will be the most tax-raising on record, the economic secretary to the Treasury Andrew Griffith confirmed concerns that the tax burden won’t be relieved any time soon.
Speaking on Times Radio, he was asked if he could commit to no further tax rises . “Regretfully” he replied, “I can’t give you a commitment“. He did at least assure listeners the Conservatives are “philosophically” in favour of a strong economy and “directionally” support low taxes. ‘In theory’ and ‘in practice’ aren’t quite the same thing…
