Fraser Nelson Fraser Nelson

The trick Osborne missed

Steve Forbes, the publishing magnate and former presidential candidate, is fighting for a flat tax

The politically mobile American entrepreneur is a species which has no real equivalent in British politics. We tend to separate the moneymakers from the policy­makers at an early age. And that is what Steve Forbes, the publishing billionaire and former presidential candidate, thinks has gone wrong in Britain: our political class has lost its sense of enterprise, and has no ideas for economic recovery.

We meet in Claridge’s hotel: he’s in London for a visit cut short by his attempt to avoid the worst strikes since the 1970s. To him, this is just the most visible sign that Britain is regaining the status it had when he was young: ‘the sick man of Europe’.

‘The journey has begun,’ he says. ‘The only reason things look relatively good for sterling is because the euro’s just as bad, and the dollar’s just as bad. It’s like three weaklings competing — none of them are going to make the Olympics. And while Gordon Brown couldn’t raise income tax rates, he raised every levy he could.’

While he’s based in New York — he runs Forbes Inc and is editor-in-chief of Forbes magazine — he is a regular visitor to Britain and sees a steady decline. ‘One reason why London is so expensive is that everything is taxed to a fare-thee-well,’ he says, looking around the hotel foyer. Mayfair doesn’t seem to be suffering, I say. ‘Well, even in 1932 you had buildings. St Paul’s still looked nice,’ he replies. It’s about as upbeat as he gets.

It is Autumn Statement day, and when I ask what he would do if he were Chancellor, he answers without any hesitation. ‘I would put in a flat tax. I would set it at 20 per cent, and raise a few exemptions — even though my Treasury would howl.

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