Budget 2008: Sending out a message
Peter Hoskin 11:05amAs Dr Oliver Hartwich outlined on Coffee House yesterday, The Treasury doesn't have much room for manoeuvre ahead of Wednesday's Budget. In short: it's down to our economy being taxed, spent and borrowed up to the hilt. Even shorter: it's down to Gordon Brown's decade as Chancellor.
What, then, can Alistair Darling use the Budget for? He'd have found some inspiration at the pre-Budget event organised by the British Bankers' Association (BBA) and the think-tank Reform this morning. As the chief executive of the BBA, Angela Knight, put it: this Budget shouldn't be about tweaking, twitching or changing - there's no space for that. Instead, it should be about "sending out a message". A message which tells the financial services sector that Britain's still a great place to do business. This can be done by either pro-business rhetoric ("attitude," as Knight called it) or by announcing, say, a review into Britain's unfriendly corporate tax regime.
Rhetoric and reviews - isn't that mere posturing? Maybe. But in this case, it's to our benefit. After all, financial service companies directly contribute about £12 billion to the Government coffers via tax, and their employees add another £15 billion. The Government's already made spending commmitments that reach far into the future. It needs all the money it can lay its hands on. If big business migrates elsewhere, other people will have to make up the fiscal shortfall. And who would those other people be? The general, tax-paying public...
Previous
Tim Worstall
March 10th, 2008 1:12pm Report this commentSigh. Please, can we get this right? Only people pay taxes. Thus the corporation tax might come as a cheque from hte companies, but it's really paid by people: the majority of it by workers in hte form of lower wages.
TGF UKIP
March 10th, 2008 10:32pm Report this comment"The Government's already made spending commitments that reach far into the future. It needs all the money it can lay its hands on ...." What a typically limp, lame Spectator Tory response to Oliver Hartwich's analysis. Quite possibly not your fault, Peter, you'd probably get the sack if you were too robust in agreeing with the Hartwich conclusions.
Pete Hoskin
March 10th, 2008 11:32pm Report this commentTGF UKIP: I'm a little uncertain why you think that little passage is my response to Oliver Hartwich's analysis. It's nothing more than a statement of fact - that the Government have plenty of long-term spending commitments and they need all the tax revenue they can get in order to fund them - that was dropped in to help my argument flow. It doesn't preclude me from maintaining that the Government's tax-and-spend economics has been absolutely disastrous. Nor does it preclude me from believing that no politician should try and emulate that same economic approach. In fact, I've made those points in other posts, and in other fora. Just didn't feel the need to wedge them into this post.
Back to top