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Chancellor is
Architect of our Problems
23-Apr-07, Windsor
Observer Article.
Most people are well aware that the Chancellor,
Gordon Brown, believes in high taxes for people and high
spending by Government. But we must never forget that
business is the engine of the economy that creates all
of the jobs, incomes and taxes that pay for the good
causes we wish to support in a caring society.
Announcing that you are spending record amounts of money
on schools and hospitals just isn’t enough. Patients must be
treated more quickly and recover more quickly; young people
must leave school with genuinely better grades than before
and better equipped to take up jobs. And, if we really care
about the least well off and most vulnerable in our society,
it is vital that business is free to create the wealth
required to keep our economy healthy and growing.
The Chancellor’s attempt to grab the headlines with a
reduction in the income tax rate from 22p to 20p in the
pound seemed at first glance like a big win for tax payers
as the Chancellor appeared to adopt the Conservative
position of sharing the proceeds of growth. But on further
analysis of course it turned out that even this income tax
reduction hid the Chancellor’s stealthiest tax yet – with
the abolition of the 10p rate and changes to the national
insurance contributions the Chancellor will actually rake in
an extra £8bn to the Treasury!
The loss of the 10p rate will hit those on low incomes
hardest and even increases to tax credits will not fill
residents with confidence when they consider the mess caused
by miscalculations and overpayments.
Doctors, nurses and teachers will find themselves paying
more in tax, and their sectors are seeing little by way of
new investment. Spending on education will hardly rise and
the Chancellor’s announcement of an increase in spending on
the NHS of £10bn is not new money, but money that has
already been promised.
The Chancellor had an opportunity with this Budget to
reverse the decline in our economic competitiveness but his
announcements affecting business will hit smaller and medium
sized enterprises (which make up 99% of all businesses)
hardest, whilst business as a whole will pay £1bn more in
tax in the next year.
The UK has fallen from being the 4th most competitive
economy in the world in 1997, to a lowly 10th. Had the
Chancellor announced measures which would have released
productivity (now half the rate it was 10 years ago) and
reduced the tax burden on business, our competitiveness
could have been enhanced and our economy would look a lot
healthier in the long term.
Given the robust and healthy economy which he inherited,
we must not forget that the Chancellor is the architect of
the problems it now faces. It will be interesting to see how
he will argue that he holds the solution should he become
the next Prime Minister.
Overall, this Budget is a tax con, not a tax cut!. |
I
believe
People are happier
when making their own decisions.
Business is the
engine of the economy that generates our jobs, incomes and
taxes.
Government should
not interfere in our lives beyond protecting and defending
us.
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