18 March 2014
With the budget coming up tomorrow, there’s a lot of speculation in the news with commentators listing the things they’d like to see. Whilst I’m on board with some of them, I don’t hold out much hope that our politicians will dare to stray too far from the norm. Most of them seem to do the same thing over and over again, but still expect different results. Incidentally, didn’t Einstein describe this as the definition of insanity?
Personally, I think things need to change and they need to change radically if we are to see improvement in the country. I’d love to see focus on improving our education and health systems and an investment in entrepreneurs and budding businesspeople – innovators and creators of jobs. However, I think what they’re doing at the moment could almost be described as the opposite.
By increasing the pressure on high earning individuals and growing businesses with heavy taxation, they’re actually encouraging people to go abroad and discouraging them from reinvesting back in the UK. At the moment, SMEs are propping things up and having to take the brunt of it, while the bigger corporations find ways to avoid it or simply move abroad.
Don’t get me wrong, I think it’s abhorrent that they’re cheating Britain out of this money, but doesn’t it make sense that the more you squeeze them with higher taxes, the more likely they are to just up sticks and leave? The government needs to give people an incentive to stay in the UK, to spend their money here. They need to make it more attractive for companies to operate in Britain. In my opinion, it makes sense to introduce a flat rate of tax for companies turning over money in the UK. Whilst it would be less to pay, everyone would actually pay it rather than fleeing the country to avoid it.
Having said that, I’m not opposed to increasing the tax free personal allowance for the lowest earners; either that or scrap the minimum wage and enforce the living wage instead. There’s got to be a better way to motivate people into work and into achieving things than paying them peanuts and then taxing them on it when it’s barely enough to live on. Business owners do have a part to play in this and ultimately they’ll see a better impact on the bottom line if they stop paying as little as they can and start looking after their employees.
Either way, I don’t think it makes sense to target one specific group with such a heavy burden. In the long run these people and businesses will simply leave Britain behind and I can’t see how that benefits anyone.
What do you hope to see from tomorrow’s budget? How can we start to level the playing field?