One of the vile things about the UK’s current taxation system is that it reaches so far down the income scale. So says Tim Worstall in an article in The Guardian, arguing that the statutory minimum wage should not be increased. Worstall pointed out that “it is possible to be working part-time on the minimum wage and be paying income tax. Indeed, a full-time worker who gets that pre-tax...

The government seems to have an unhappy knack of getting into a mess with property taxation. The latest wheeze is a tweaking of the Council Tax so that people who live in nice area pay more. Labour planning secret tax on ‘nice houses’

We do not usually find ourselves in agreement with the IMF, but we go along with their chief economist, Oliver Blanchard, in his criticism of Gordon Brown’s £12.5bn cut in VAT. Blanchard has dismissed it as “not a good idea”, warning that European governments faced a new Great Depression if their stimulus packages proved inadequate.

EMPLOYERS’ BURDEN OF TAX 2008/9 EMPLOYERS’ BURDEN OF TAX 2008/9 Tax Rates                     % of   Employers NI         Gross max a £0.00 — £5435.00 0% £0.00 b £5435.01 — no limit 12.8%               Employees NI           a £0.00 — £5435.00 0% £0.00 b £5435.01 — £40040.00 11% £3806.55 c £40040.01     1%               Income...

The Laffer Curve is derived from the observation that the higher the tax rate goes about above 30% or so, the less revenue is raised. But it only applies to present taxes which are levied on transactions, work, goods, and services. The tax reform proposed by the Campaign is an exception to Laffer’s rule.

Speaking at the Conservative Conference, David Cameron claimed to be “a man with a plan”. He is not. Neither party has given any indication that they are capable of coming up with any policies that would be better than letting events take their course, which should lead to a natural recovery from about 2015, though the Japanese problems have taken much longer and still there is trouble...

The Swedish budget was announced yesterday. The theme is “skattesänkning” – tax cuts and credits designed to stimulate employment as well as a reduction in taxes on business. The tax cuts mainly benefit those on higher incomes. There are also small tax cuts for pensioners. The Social Democrat’s economics spokesman, Thomas Östros has criticised the finance minister, Anders...

As a pleasant change, someone is speaking up for LVT, in a review of Brian Hodgkinson’s Book “A New Model of the Economy”, published by Shepherd Walwyn. The comments are revealing – in fact it is worth registering with the Guardian and adding to the discussion. There are some bizarre notions around.Article by Mark Braund in the Guardian

Another paper produced for the IFS Mirrlees Review discusses the politics of taxation in a democratic society. The title of this paper is  The Political Economy of Taxation. This contains useful information about interest groups and how they respond to proposals for change.

Another paper which forms part of the IFS Mirrlees Review deals with administration and compliance, pointing out that with present transaction-based taxes, the costs fall primarily on business. There is a useful discussion there concerning the difference between who bears the burden of a tax and who is statutorily liable. It talks about distortion costs, efficiency costs, distribution costs, administration...