Sunday, July 16, 2006

Tax Cuts are economic stability

There's no questioning the excellence of this article in The Business, the only paper that routinely dismisses the false orthodoxy of DaveGordism, the Butskellism of the Noughties. Nice of them to use the TaxCutter's statistic of 9,050 pages of legislation without reference again.

http://www.thebusinessonline.com/Stories.aspx?A%20tax-cutting%20lesson%20from%20across%20the%20Atlantic&StoryID=F3C22961-AFBD-41CE-B04E-F97827668AE3&SectionID=803597D7-4BD5-45D5-BF88-E1AC85BF7FDF

The article should be compared with George Osborne's dreary answers to questions he chose to answer on ConservativeHome
http://conservativehome.blogs.com/interviews/2006/07/george_osborne.html.

The TaxCutter notes that The Business only looked in detail at the US experience. Maybe they could do a whole series.

Eg Series A - Also look at Ireland, Australia and Canada, recent taxcutters whose taxcuts also increased revenues and economic growth

Series B - Old Europe, including theUK, who have either held taxes at a high level or raised them, and how virtually all the budgets are in deficit

Series C - look at Hong Kong - low tax, payable by few that means the Territory has huge back-up funds accrued over the years

Series D- The Flat tax champions of Eastern Europe

Hang on - I might just do it myself.

Recent murmurings suggest that the UK government might exempt overseas dividends from tax when repatriated to the UK. This of course should have been done years ago,
business has had to keep funds offshore rather than pay a poll tax when dividending profits of overseas subs to the UK - a factor the OECD has felt need to comment upon. An IMF survey a few years ago indicated that exempting such dividends increased the size of them by 50% - which would approximate to an additional £16bn of investment in the UK each year.

The reason for the change? Its because the ECJ will rule that UK law is illegal - so good to see that Gordon still has total control over direct tax matters

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