Tax and Fiscal Policy

Supply-side reforms will be the true test of ‘Trussonomics’


Energy and Environment
In the Media

Harrison Griffiths writes in The Daily Express

Mark Littlewood writes for The Times

IEA Director General Mark Littlewood has written for The Times on Liz Truss’ economic agenda.

Arguing that ‘Trussonomics’ remains necessary despite a first few weeks which have been “as grim as anyone could have imagined”, Mark wrote:

“So far, really, we have seen only one part, which was rolled out in the form of last week’s mini-budget. This was to reverse the trend that has led to the highest overall tax burden since the 1940s — and to do so in such a way that wasn’t focused exclusively on distributional outcomes. Because the affluent pay more taxes, it is effectively impossible to reduce taxes without higher earners reaping more of the benefit.”

Emphasising that tax cuts are only the first part of the three-plank agenda for economic change, Mark outlined “the second pillar of Trussonomics: how and where to get state spending down”, and “The third plank of Trussonomics, deregulation”.

Mark’s concluded by restating the case for Truss’ economic outlook, highlighting the potential of her programme if she can overcome short-term political obstacles:

“Truss has continually rejected prevailing orthodoxy and, in many areas, has been right to do so. She has certainly already delivered a major break from a “steady as she goes” economic approach. Lower taxes, combined with spending restraint and regulatory reform, is a disruptive but exciting strategy.”

The full article can be read here.