Tax cuts are long overdue but a huge boost for Britons
1 October 2014
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Government and Institutions
Reaction to the Chancellor's speech
29 September 2014
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Reaction to David Cameron's speech
Commenting on David Cameron’s speech, Mark Littlewood, Director General at the Institute of Economic Affairs, said:
“Finally the Prime Minister has shown intent to ease the burden on UK taxpayers. However, it’s important to remember that in real terms the changes to the 40p rate will not be as momentous in four years’ time when taking inflation into account.
“David Cameron would do well now to look at ending the pernicious effects that other taxes have on ordinary people. Government policies have imposed a huge tax burden on many ordinary workers at the same time as families across the country are struggling with rising living costs. Higher rates of stamp duty are now paid on most London property transactions and the inheritance tax threshold has not kept up with inflation. These measures have dragged middle earners into the higher rate tax band and should also be urgently reformed.
“The Government should introduce legislation requiring all income tax thresholds to be increased annually by the higher of wage growth or inflation. This would begin to compensate for years of under-indexing, and send out a signal that our politicians are friends of both economic growth and aspiration.”
Notes to editors:
To arrange an interview with an IEA spokesperson, please contact Stephanie Lis, Head of Communications: slis@iea.org.uk or 07766 221 268.
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.
“Finally the Prime Minister has shown intent to ease the burden on UK taxpayers. However, it’s important to remember that in real terms the changes to the 40p rate will not be as momentous in four years’ time when taking inflation into account.
“David Cameron would do well now to look at ending the pernicious effects that other taxes have on ordinary people. Government policies have imposed a huge tax burden on many ordinary workers at the same time as families across the country are struggling with rising living costs. Higher rates of stamp duty are now paid on most London property transactions and the inheritance tax threshold has not kept up with inflation. These measures have dragged middle earners into the higher rate tax band and should also be urgently reformed.
“The Government should introduce legislation requiring all income tax thresholds to be increased annually by the higher of wage growth or inflation. This would begin to compensate for years of under-indexing, and send out a signal that our politicians are friends of both economic growth and aspiration.”
Notes to editors:
To arrange an interview with an IEA spokesperson, please contact Stephanie Lis, Head of Communications: slis@iea.org.uk or 07766 221 268.
The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.
The IEA is a registered educational charity and independent of all political parties.
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