In Tax Competition – How tax havens help the poor Richard Teather argues that tax competition brings benefits to all of society, not just to those that directly take advantage of it. By encouraging lower taxes and allowing greater efficiency in capital markets, tax competition encourages economic growth, the benefits of which often fall to the least well off. The unemployed are more able to find jobs as the economy expands, while low-paid jobs are made more productive (and therefore valuable) by increased investment.
Vince Cable’s proposed ‘mansion tax’ on high-value homes has come in for a lot of flack. But is it justified?
This report, A Flat Tax for the UK – A Practical Reality, calls for income tax to be simplified into a flat rate tax of 22%. Under the proposal, there would be a tax-free personal allowance of £12,000.
As the report says, the concept of a flat tax, a simple tax system that charges a single rate of tax on all income, is growing in popularity. It contrasts clearly with the current systems operated in most countries, with different tax rates depending on the level and type of income or on the personal circumstances of the individual taxpayer.