[jambutty]

SCRAP ANY FORMS OF TAXATION ON EARNED AND UNEARNED INCOME.

Meaning scrap Income Tax and National Insurance Contributions on wages and salaries and tax on savings, share dividends and other forms of unearned income.

I can almost see certain members frantically reaching for their keyboards with words like ‘daft’, ‘stupid idea’ and ‘this guy has finally lost his marbles’ foremost in their narrow minds, together with what they might consider as suitable insults.

But STOP – before you may an utter fool of yourself, think it through. Here, I’ll help you!

This loss of revenue to the Treasury can be recovered simply by increasing VAT on all goods that are sold be they new or second hand and on services like insurance, repairs etc and importantly spending or sending money abroad. In other words there would be a tax on any money that we SPEND and not a tax on money that we EARN.

No doubt most people would prefer no taxes at all but they are not living in the real world.

If such a radical measure was adopted, and I accept that no government would give it even a single thought, what would be the effects?

First of all the whole massive department that collects income tax would not be needed anymore and the resultant savings would be enormous. Sadly thousands of people would be chucked onto the workforce scrap heap but they are being paid from our taxes to collect money from us. Surely it is better to pay them the going dole rate than high wages with inflation proof pensions for some? They might then understand how the thousands upon thousand of manual workers felt when they lost their jobs in mining, shipbuilding, steel, cotton industry and many others.

Obviously some of the workforce would be needed to collect the VAT.

Various cash benefits would have to be increased to compensate.

The black economy, which is reckoned to run to billions per year, would be drastically reduced. People who do “work on the side” do so to avoid having to pay income tax and/or to supplement benefits. But by paying a tax on what they spend means that they would be contributing to the National Purse when they spend those ill-gotten gains.

Currently, when the Chancellor decides to hit the fat cats with higher income tax, all they do is engineer themselves an increase in salary to compensate. Thus taking cash out of the company pot that could have been used to increase the lot of the workforce. So the end result is that the fat cats still take home the same amount of cash and in all probability take home more.

Everybody, no matter how they gain their money, has to live and to live they need to spend money to buy food, pay rent or mortgage, pay for energy, water, clothes etc. Thus everyone makes a contribution to the national wealth based on their choice of how much to spend and that includes visitors to these shores.

Such a radical suggestion could also encourage people to save some of their money and isn’t that what the government wants us all to do? Save!

No doubt some smart Alec will pop up to smugly state, what rate of VAT do I propose. Not being privy to the government ‘books’ I don’t know but if were to hazard a guess I would suggest 22% on all goods and services that go to make up the National basket that is used to calculate inflation providing that it also included mortgages. Goods and services not listed in the National basket would attract a higher rate of 45%. Real luxury items, that only the very rich could afford and are well out of reach of most people, would attract at least 60% VAT.

That is just only an overall outlook and no doubt there will be many, many side issues evolving from them but I believe that problems are there to be solved and not just dismissed out of hand.

Right then, who is going to be first to indulge themselves in some name calling?