From TaxPayers' Alliance <[email protected]>
Subject Weekly Bulletin
Date June 7, 2020 10:44 AM
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Tax reforms to secure a recovery from coronavirus
The economic fallout of the pandemic has been severe and could even dwarf the great recession. To ensure a rapid recovery we are calling on the government to instigate major tax reform. Released earlier this week, a new report by TPA research fellow Rory Meakin lays outfive key changes that could help the economy bounce back ([link removed]) .
Many in the Westminster bubble have called for tax increases but these would cripple much needed growth. Instead bold action is needed, some taxes should be abolished and in other cases their thresholds raised at the very least. Our five policies for giving the British economy a post-pandemic boost are:
* Abolish employer national insurance, cutting a typical business' payroll tax bill by 38 per cent this year.

* Abolish employee national insurance, meaning an average worker would pay £1,622 less tax this year.

* Abolish capital gains tax, which could grow the economy by up to 3 per cent.

* Increase the annual corporation tax investment allowance to £5 million, which would catapult the UK to the top of the OECD’s rankings for the best treatment of fixed capital investment.

* Raise the Stamp duty land tax threshold to £1 million, unlocking 220,000 home moves, the equivalent to the total dwelling stock of Manchester, Leeds or Bristol.

Our ambitious package of supply side reforms has been welcomed by former secretary of state for trade and industry Lord Lilley, saying, "It is vital to switch the focus from the costs of shutting down the economy to stimulating recovery as we move out of lockdown. Thank heavens the TaxPayers' Alliance are proposing bold tax cuts to boost the recovery."

Raising taxes would be a form of madness

The report received excellent media coverage, notably, The Daily Telegraph, The Times, Daily Express and Yorkshire Post. On Friday, TPA chief executive John O'Connell wrote a comment piece for The Times' Thunderer column ([link removed]) . He said it would be "madness" to tax our way out of the current mess adding:

"Instead, substantial tax cuts are required to sharpen incentives and confidence. That means the time for bold tax reform has arrived. Rather than cutting a rate here or raising a threshold there, the government should augment the power of supply side reform by abolishing whole taxes entirely and replacing them with simpler alternatives when necessary."
Just this morning John appeared on Sky News to discuss our pro-growth policies. Our message is reaching millions across the country.

And there is already good news for taxpayers, the PM and chancellor are heeding our calls! Reports suggest that plans are being drawn up to cut taxes and slash red tape ([link removed]) . The government is also considering extending Sunday opening hours which we have previously called for ([link removed]) .

It's great to see politicians are listening to the TPA but there is more to do. We will continue to keep the pressure on them in the corridors of power.
Do you support our tax reforms? (mailto:[email protected]?subject=Tax%20reforms)
Axe The Tax
The BBC has announced that Tim Davie is to succeed Lord Hall ([link removed]) as its new director general. He is just the latest in a long line of 'establishment' bosses and one of his main goals is "negotiating with the government about the future of the licence fee."
To that we say Mr Davie needs to be more realistic about the future of the Beeb. It has lost its way and desperately needs reform. Netflix and other streaming services, free or subscription-based, are now the first choice for many viewers. The BBC should move firmly into the 21st century and axe the TV tax!
Support our Axe The Tax campaign. ([link removed])
TaxPayers' Alliance in the news
Huge pay rise for civil servants

Despite current events we were staggered to learn this week that pen-pushing civil servants in Scotland have been awarded 12 per cent pay increases ([link removed]) . This was followed by another kick in the teeth for taxpayers as a further 400,000 government workers across the country could also get pay rises ([link removed]) .
Asked to comment on the story for the Scottish Mail on Sunday, the TPA's Joe Ventre said, "Millions of private sector workers have had their lives upended by the shutdown, so it seems unfair for those same taxpayers suffering to have to fork out for senior public sector pay packets."

The TPA will continue to call out overly generous and ill-timed sector pay packets.
Blogs of the week
Crowding out and the threat of higher debt

Our policy analyst Jeremy Hutton recently analysed three centuries of debt ([link removed]) amassed by British governments. Further expounding on the subject he has written about the economic phenomenon known as the crowding out effect ([link removed]) . The argument goes that countries with higher levels of public debt suffer from lower growth rates if the government fails to stimulate the economy (usually by spending on mass infrastructure).

Jeremy argues that the government must not fall victim to the false idol of "borrowing to spend". Instead, he writes "the government should be shamelessly pro-growth and liberalise the economy so that we can grow our way out of this mountain of debt. In this way, Britain may yet emerge from the shadow of the current crisis a savvier and more entrepreneurial place, better suited to making the most of future opportunities and keeping the books balanced."
Agriculture, trade and food prices

Regular readers will recall that the TPA successfully defeated amendments to the Agriculture Bill that would have seen future restrictions on UK trade. Writing for the blog this week, Sir Richard Packer, former Permanent Secretary of the Ministry of Agriculture, Fisheries and Food, explains the impact of protectionism on food prices.

He argues that whilst trade is a "complex area" that affects many different industries, one thing is certain - "tariffs and restrictions on agricultural products will push up the cost of food." Sir Richard explains the mechanisms by which that happens from import quotas to levies and ultimately taxpayers will end up paying more, whether it is via tax paid to the exchequer dished out to farmers, or via higher consumer prices. Click here to read more. ([link removed])
War on waste

Plane wrong!

A freedom of information request by TPA researcher Darwin Friend has uncovered that Norfolk County Council has spent an eye-watering £60,000 on flights since 2017 ([link removed]) . The taxpayer shelled out for 359 flights which allowed jet-setting councillors and council staff to travel to exotic locations all over the world.

It’s no surprise that the council’s flight bill is sky-high. For instance, sending one staff member to a "cultural exchange programme" in Norway cost £804 just in air fares. On another occasion, a premium economy seat was purchased for a short flight to Edinburgh.

Commenting on the findings, Darwin said: “Norfolk ratepayers will be annoyed by these revelations. The council must prioritise keeping rates at reasonable levels and funding frontline services.”

Click here to find out how much your council has spent on flights ([link removed]) .

Harry Fone
Grassroots Campaign Manager

Make a donation to the TaxPayers' Alliance ([link removed])

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