The Taxpayers Alliance and the Institute of Directors have proposed a way out of the current problems by suggesting a flat rate of Income Tax and losing all the fancy schemes that are just tax dressed up, such as NI, Stamp Duty, Airport Tax etc etc and make it very simple. I think this is a great idea to really think outside the box and come up with original solutions.
The current tax system is really complicated. Having been in business running my own company for about 5 months, I am having a steep learning curve about just how complicated it can be and just how easily you can be caught out. You could argue that it’s no bad thing, it keeps Tax Experts and HMRC employed. but currently there is a lot of bickering about who is being taxed worse, and who gets the best benefits etc etc, having one rate would make life a lot simpler.
This route would generate less income to UK Gov, but the idea is that we become more attractive to business and therefore inspire growth and that is the only way out of this quagmire we are currently in. We have already shown that austerity on its own just breeds depression, it needs to be accompanied by a real plan to grow the economy.
The most insightful part of this report for me was the following quote from Allister Heath, editor of City AM:
It is time for Britain to make a vital choice between tweaking the status quo and letting our economy continue to be crippled by complex and punitive taxes, and drastically changing course with a radical but realistic plan for a tax system fit for the 21st century.
I think the numbers are probably a point for debate, but the need to overhaul how we tax people could be a critical step in moving forward.
- How the Taxpayers Alliance want to raise your taxes (liberalconspiracy.org)