From: mossop@pangea.Stanford.EDU (Antony Mossop)
Newsgroups: soc.culture.british
Subject: Re: Record shops (LPs)
Date: 8 Jan 1993 23:23:32 GMT
Organization: Stanford Univ. Earth Sciences
Distribution: world
NNTP-Posting-Host: pangea.stanford.edu

In article <1ik11kINN9af@grapevine.EBay.Sun.COM> martin.baines@uk.sun.com writes:
>In article 1iig30INN3c2@morrow.stanford.edu, mossop@pangea.Stanford.EDU (Antony Mossop) writes:
>[deleted earlier thread]
>>>>Maybe a decent set of prices in the UK is just what we need to get the
>>>>economy moving again.
>>>
>>>Great idea! Now what government services shall we cut to
>>>make up for the loss in duty and VAT revenue?....
>>>
>>>Martin
>>
>>How about the service to people with high incomes that let them pay
>>less tax so that revenue had to be made from the pushed up VAT?
>
>Well we could start by removing the subsidy from central taxes
>to local government. At the last budget that put 2.5% on VAT
>to reduce poll tax for those individuals who didn't like
>having to pay for local services. 
Ahh you mean the community charge (close kin of the deceased Papua
New Guinean hut tax, killed off after the local powers deemed it
regressive [urban legend?]). You might not have noticed this but
a flat rate tax where everyone pays the same regardless of income
is regarded by most people as grossly unfair and exists in no other 
civilised country. The British public had next to no say in this
matter it was just dumped on them. The sole beneficiaries were people
with large expensive properties who strongly equate with those of higher
incomes, many of whom also disagreed with this tax. Later, after massive
non-payment the govt. admits that maybe they were wrong.
Forgive my cynicism but do you really believe they'd have bothered
to do this if everyone had paid up? If a policy is forced on people
that is unpopular and unfair their only recourse (and a very justifiable
one at that) is disobedience.
>                                  The other subsidies from Central
>to local government account for between 2% and 5% on VAT (depends
>on whether you consider paying for Education and the Police
>to be central government's job, or local governemnt's), that
>gets us to about 10% VAT. Next abolish the NHS, there goes the
>rest of VAT and a bit of direct tax. Voil we have US tax levels.
>
>Did I hear you say politically unacceptable? Surely not.
>
>Or we could put up Direct Taxes to replace VAT: takes us
>to average Direct Tax rates (including Income Tax, personal
>National Insurance and Employers NI contribution) of over
>50%. Next we remove all duties on imports (sod the E.C
>and GATT), that takes us out Direct Taxes well over 50%:
>but we have got US level indirect taxes.
>
>Did I hear you say politically unacceptable? Surely not. 

Strange that a few years ago that most of the tax revenue came from
income tax and very little from VAT. Then there came the tax cuts where
the small earners got an extra fiver a week and granny's new hip
went from a 12 to an 18 month wait. If you were a high earner you made
thousands. Sadly the Con govt. needed more revenue so they slapped it on
VAT. Let's try and figure who gets penalised by this? Why those citizens
who spend a larger proportion of their income of VATable items. Who would
that be? Why it's the low to middle incomes. The tax burden on the average
person increased from about the mid 30% mark (36%?) to 39% during the 1980's
the tax burden on higher income brackets reduced. Shifting taxation from
income to goods taxes is regarded by many economists as regressive.
So I stand by my statement shift the tax burden back on the higher 
earners (surely if market economics are true it won't matter how much
surplus income the wealthy have the market merely adjusts to it? The
wealthy still stay wealthy; then again maybe market economics don't
really work that well). Politically unacceptable you say, well so
is artificially induced inflation in the form of VAT, the only reason
that higher income tax is less politically acceptable than high
VAT is it hurts the rich and powerful more and sadly they're the ones
who control/are the politicians. (Or did you mean yet another embarassing
U turn in the form of raised taxes would be politically unacceptable?)


Tony Mossop, geophysics, Stanford
>
>Martin
>
>---
>"You might say that, but I couldn't possibly comment"
>
>Martin Baines, Sales Support Manager,
>Sun Microsystems Ltd, 306 Science Park, Cambridge, CB4 4WG, UK
>Phone: +44 223 420421                 Fax: +44 223 420257
>JANET:     Martin.Baines@uk.co.sun    Other UK:  Martin.Baines@sun.co.uk
>Internet:  Martin.Baines@UK.sun.com
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>