Partner Article

Is abolishing income tax the best way to rebalance our economy?

We hear thoughtful suggestions that the UK economy could be rebalanced if income tax was abolished (loud cheers all round) with VAT increased to, say, 33% - 38% (cue: stunned silence).

Disregarding the probability that this would encourage people to spend the absolute minimum and save as much as they could, would this be achievable?

Not if Europe has anything to do with it.

While the EU is currently consulting on the way the existing VAT legislation relates to tax exemptions in the public interest, public bodies and the like, it’s almost inconceivable that any EU member state would be willing to raise its VAT rate to these levels.

This was posted in Bdaily's Members' News section by George Bull .