Thoughts on “equal” taxation, LTV, deficits and stable economies

Today I replied to a friend on Facebook who takes issue with Labour’s proposals to increase income tax, and he mentioned a few points which I wanted to take the time to respond to with more independent voices on those topics. I thought it worth sharing:

I won’t try to change your mind, only plead with you to make sure your vote is as informed as it can be by people outside the political parties who are obviously biased. To that end, let me share a few things with you about specific bits you’ve mentioned.

An “equal” tax, while it sounds good (I used to think so too!), actually creates INequality. Flat taxes are also not simpler, and are designed to demolish the state – a flat tax would destroy the NHS overnight for starters, and probably a lot more because the state would have a LOT (£bns) less income. See economist Richard Murphy on flat taxes and if you’re bored enough, his report on flat taxes.

I’m glad you agree Labour’s spending commitments are needed (so do 129 economists!) and with government services, like any other services, you get what you pay for. Lower tax will always mean fewer or poorer quality public services. You only have to look at the fact austerity has given us fewer police officers, less school funding, and an NHS crisis to confirm this is the case.

On the Land Value Tax, that’s actually a very sensible change (e.g. supported by the Institute for Fiscal Studies). You personally would probably end up paying less than you pay in council tax. Have a read of Full Fact on that one. There was a lot of scaremongering about LTV, most of which was nonsense, and besides the Tories would probably want to introduce something like it anyway.

As for the deficit, the first thing is to recognise is that the state is NOTHING like a household. In fact, sometimes a deficit is absolutely essential to a well-functioning economy. As for a sustainable economy, wages are falling and inflation has been rising for two years, which means people are less able to spend which takes money out of the economy, making it harder for businesses to succeed. If we judge them by their record, as Amber Rudd asked us to, they are not going a great job.

I don’t expect you to read all those 😀 but please please don’t just accept whatever the political party press releases and platitudes say. On a personal note, I’ve always benefited personally (in a financial sense) from Tory governments but I consider it my responsibility to vote for what’s best for everyone, not just me, and I could never countenance voting for them while they are cutting thousands of pounds from the school my son will go to.

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