You’re right. I thought it was a tax on assets. It’s an income tax on earned and unearned income.
I’m not a fan.
https://www.axios.com/2023/03/07/biden-medicare-proposal-debt-ceiling-talks
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2021–22[39]|Rate|Income tax rate|Gross income|
| — | — | — |
|Starter rate|19%|£12,571† – £14,667|
|Basic rate|20%|£14,668 – £25,296|
|Intermediate rate|21%|£25,297 – £43,662|
|Higher rate|41%|£43,663 – £150,000 ††|
|Top rate|46%|Above £150,001 ††|
I worry that your misinformation is causing you to make the wrong conclusions. You should leave that to idiots like Truss, look how well she did.
Revenues from corporation taxes rose after 2010 for a bunch of reasons, but not because the primary corporation tax rate was lowered. I’d love for you to explain how you see it though. How does dropping the tax rate by one third end up pulling in more revenues? Within a few years? Please give your understanding of how this works.
(PS I know what actually happened so very much looking forward to your explanation.)
It attracts more foreign investment for a start, meaning more jobs, more corporation tax and more PAYE taxes. They also have a knock on effect in the economy by buying from local companies and businesses as they grow and expand. In addition, companies have more money to spend on wages, increasing people’s personal disposable incomes which in turn gets spent in the economy
In 2010 the country was recovering from being bankrupt by the last labour government in 2008. I can’t wait to hear your story on how increases in tax revenues had nothing to do with reduced taxation and the Laffer Curve.
Except your reasons are not why corporate tax revenues increased. Especially as you got distracted into individual spending when the topic at hand is tax revenue from businesses. Stay focused, please.
The increase in business taxes might have marginally improved by new investment from overseas - but truly this did not make a big difference. No you are going to have try harder.
PS the financial crisis in 2008 was caused by inadequate finance sector regulation over decades. Not the labour government.
The labour government saw this coming down the track - they did nothing.
Now lets hear why you think lowering tax rates didn’t increase tax revenues…
(Yes, and the previous tory government were all over this problem. Not.)
Its not my view. It is simply me telling you what happened. The actual events were that after the basic corporation tax came down by a third, two key things happened. If there was simply a drop in the tax rate then, of course, the revenues from business taxes would have also come down. That is obvious to everyone.
The first thing was that other business taxes went up. More revenues were taken from corporations from other tax mechanisms. This is well documented.
The second thing was that business profits went up. As the country and the businesses moved out of the 2008 crash their profits increased. So the revenue from the basic corporation taxes also went up.
So what occurred was that business tax revenues did increase in the years following the cut in the corporation tax rate. What did not happen was that revenues went up because of this cut. That simply is not true. In fact, if the tax rate at remained at 28% then revenues would have gone up more.
It was dangerously misleading of Truss to pretend that there was a cause and effect going on. This claim simply suited her ideology so she ignored reality. This is dangerous because it can make people make the wrong decisions and support the wrong policies for the wrong reasons. Which is why it is important to confirm what took place.
Absolute bollocks mate 
If you are right, the higher the corporation tax, the higher the tax revenues, which is just absurd.
Businesses pay for everything, the more that businesses make the more tax they pay, the higher the tax rate, businesses avoid tax by moving abroad or protect revenues by laying off workers, reducing PAYE and NI tax contributions. Thats how it works
Thatcher did the same in the early 80s when taxes were 60/70% and fixed the economy. Socialists never ever learn.
You seem to be suggesting that if you reduce the tax level the actual takings in tax go up. I hope you are not consulting to other industries. You would be telling farmers to plow up a third of their crop so that the yield will go up. Or guiding the makers of quilted jackets to take out a third of the fleece so that their customers get warmer.
You were also presenting theory and concept. You are ignoring what actually happened in the UK over the decade since the corporation tax cut. I can’t help you if you simply prefer to ignore facts. Sorry mate, on that you are on your own.
Perhaps not Strath, but if you reduced the farmers tax burdens they would either invest in their companies or set on more staff. More staff = More PAYE so collectively they will be paying more tax than if they just increased the farmers tax burden. Plus, you have given people a job.
I like the theory. But
Thats exactly what happens. I’ve already explained this and given the Laffer Curve as a reference.
If you think that reducing output of industries (such as your farming example) you’ve given supports gains in yield, in the same way that the Laffer Curve increases tax revenues by lowering tax rates I’d suggest your even more deluded and clueless about economics as everything else you claim to be an expert in. Look at Ireland which has a corporation tax rate of around 12.5% - they received massive amounts of foreign investment as a result from Google, Apple, Pfizer etc.
Don’t run a business whatever you do.
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But we’ve already discussed how the Laffer curve never had any credibility. Laffer made up a curve based on connecting two doubtful data points - (1) if you have very high taxes the actual yield (only in a US based tax structure btw) is less than target because people become highly incentivised to reduce their tax contributions; (2) if you have a very low tax rate then people are more likely to honestly offer all the tax they are due.
Both of these are suspect - many people will aim to reduce their tax payments regardless of
the tax rate and in a tax regime like the UK where the majority of people have no choice due to PAYE this doesn’t apply.
Then Laffer drew a curve between the two points (note - both false points for the UK) and claimed you can get more tax revenue through lower tax rates.
As everyone can see from this explanation it is a joke of a theory. And especially a joke of theory when you try to apply to businesses. They simply take the extra retained profit and give it executives and shareholders.
Whatever you do, don’t pretend to be an economist. And don’t base your whole argument on rubbish theories.
People pay taxes when they are fair and businesses invest in countries where they can maximise their profits. Low taxation (corporation tax) is one key area and low PAYE rates attract workers to fill the jobs.
I quoted Ireland as an example - an EU member state which plunged its corporation tax rates after the financial crash to stop it going bankrupt. It worked and that is due to the Laffer Curve that optimised tax returns by lowering the tax rates.
Stop making things up, you might get somewhere in an argument.
Lets just agree to disagree. You want low taxes and therefore place faith in the Laffer curve.
I disagree and have clearly shown that Truss’ claim was false - and had nothing to do with the Laffer theory.
Bored with this now.
Truss was right.
You do realise your article from Reuters was from 2022 and when tax rates went up to 25% this year, Astra Zeneca changed their mind about investing in expanding in UK and instead…
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You do realise that having the last word is not the same as being correct?
And you do realise that Truss has never got anything right? It’s in her DNA to be wrong and make mistakes.
Truss was right about everything, thats why the globalists had to get her out.
The reason the country is in the sh1t now is because of high taxes and socialist policies.
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Ok, after this last delusional post from you I’m giving up on this thread. Your blinkered ideology means that you cannot accept reason and facts.
First, you do realise that the tories have been in power since 2010 so that means, according to you, they have been implementing these socialist policies?
Second, how do you square your criticism of globalists with your joy at so many global trade deals?
Third, you do know that Google and Apple (Starbucks, Amazon, etc. - you know these globalist companies) don’t really care about local corporation tax because they simply shift declared profit around the world until it all ends up in a tax free place like the Cayman Islands or wherever they stash their cash? (Again read the book ‘Moneyland’.)
Fourth, have you forgotten that Truss was the shortest serving PM ever because she and her plans were so truly bad that she cost the UK billions and came close to trashing the UK’s private pension industry. Ta Liz.
Fifth, my information was independent, unbiased and accurate - Truss was intentionally misleading. And then you were repeating this wrong claim. Shame on you and your ideology driven biased claims.
The Tories have been implementing socialist policies since Johnson, we have the highest taxation in 70 years and are following stupid globalist WEF policies like net zero. We also had 2 years of authoritarianism through COVID and forced vaccine mandates, orders to stay at home and laws preventing people from seeing their families, all paid for by guaranteed basic income (or furlough as you would like to call it) etc. Before May we had years of austerity, Everyone knows now that a vote for labour is a vote for austerity further down the line, which is exactly what happened after Blair and Brown. Thankfully capitalism repaired the damage by the socialists just like it did in the 80s under Thatcher. Lowering taxes both times was key in the UK recovery.
Globalism and Globalisation are 2 different things. You don’t know the difference between them, like you didn’t know the difference between capitalism and corporatism. I’ll let you educate yourself on this because I don’t have time to do it for you.
Nationalism (such as EU nationalism) is never a good idea. Globalisation and free trade allow companies to trade freely across the world and compete without government interventions (such as the single market rules of the EU). Global trade deals are good deals when they work for everyone, EU trade deals (for example) only work in the interest of the EU. The WTO promotes free trade for these reasons.
Google and Amazon are in low tax Ireland to maximise profits through paying low rates of corporation tax. They also employ thousands of people which helped recover Ireland from the mass unemployment in 2008. These companies like all others who are global and have shares on international market pay for pensions. There is nothing illegal about moving money to where it best suits a company - read the Laffer Curve again and this time try and understand it. Moneyland is a book written by Oliver Bullough who, like you and other “socialists” don’t understand how the world works. I bet the profits from that book went under scrutiny by Bulloughs accountants to minimise his tax liabilities, but as usual, its a rule for them and a rule for everyone else. Especially those who are a lot more successful than him.
Truss was right, at the time, the stupidity of net zero had made the UK and (especially) Europe see inflation go up so much, people couldn’t afford energy bills when Putin invaded Ukraine, stopping gas supplies and hiking gas prices up on the markets as a result. So the only way to raise the £ billions needed to help people facing £6k winter energy bills was to raise the funds it from the debt markets. The problem was the sheer scale of about £1.6 TRILLION tied up in liability driven investments in these markets, and it was the Bank of England raising interest rates to 3.5% that caused the whole thing to crash. This wasn’t Truss this was the BoE who, under the sheer incompetence of Andrew Bailey raised interest rates way beyond the level that the markets could cope with. The answer, was Bailey who had been caught asleep at the wheel had to intervene and pump 60 billion into it to stop the damage he caused by whacking up interest rates. Nobody in the BoE even told Truss what they were doing or what the outcome would be of putting up interest rates up so high and so soon. This was sheer incompetence by the BoE and I doubt they even knew themselves what would happen.
If anything, it was labour that trashed pensions under Brown when he first introduced PFI to avoid public spending he could no longer afford, then selling off the UK gold reserves and then raiding pensions not once but 3 times before they crashed the UK economy before resigning from office.
Truss was never intentionally misleading either, I’ve explained this.
Shame on me ? Thats hilarious.
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