Jo Johnson writes in today’s Financial Times (£) about the disaster of high taxes in the United Kingdom. He points to a KPMG survey that showed the UK has the 4th highest top rate of income tax of 86 countries – beaten only by Sweden, Denmark and the Netherlands. Johnson also mentions a World Economic Global Competitiveness Report – which looks at the tax system to assess incentives to work and invest – that placed the UK 95th out of 135 countries. Our tax system hinders competitiveness.
Interestingly, he notes that Sir Nicholas Macpherson, permanent secretary to the Treasury, disclosed that 63,000 out of 275,000 taxpayers liable for the top rate work in “financial intermediation” in a letter to the Public Accounts Committee. Many of the others, Johnson notes, are entrepreneurs we need to create jobs and help drive the recovery. Unsurprisingly, numbers from the Treasury finally confirm the tax politically deployed to sate public anger of ‘bankers’ is misguided.
Benedict Brogan at the Telegraph notes that George Osborne might “put down a marker” on the 50p rate at the Budget next week. It should make for interesting viewing.