Quote:
Originally Posted by danielf
Lowering the amount that low earners need to pay sounds good to me. However, the recommendation is for £21bn in tax cuts. Where will the money come from, or more specifically, what areas will see reduced funding?
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I don't believe it was part of the team's remit to look into that.
It would be up to the Tory chancellor to decide whether to impliment any cuts or not, which is what they've said all along.
They'll have to look into where savings could be made, such as hospital managers (that's always a good one the media tells us we have too many of), or spin doctors, or the hundreds of extra civil servants Labour employed (I know, I've met some of them, and I object to £20,000 of our tax going to some obnoxious woman who's job is to recieve a fax, take a photocopy, and then fax it on to another office, yes, I kid you not, that was her job).
They'll also have to way up how much of that tax reduction will return to the treasury anyway when it is spent.
Spend £100 at tesco, and 17.5% goes to the treasury, then there's the 20% odd that goes to the treasury as income tax and NI for staff, and the amount from what the employees then spend.
So if a tax cut boosts the economy through more consumer spending (rather than them using credit which we currently do) then that will in turn feed money back into the treasury.