Raising capital gains tax to 28% is cutting back the rate at which money moves around. If you have a gain, you sit on it to avoid tax, whereas when CGT was 10%, you were more likely to cash it and move on.
Cable is behind the curve. Even Gordon Brown appeared to understand how capital taxes kill off investment. The fairness agenda is misplaced when it comes to taxing success.
Cable talks of quick killings. Maybe he doesn’t realise but that’s what economic growth is all about. Few ‘killings’ are quick. Most require risk-taking, skilful assessment and dedication. Oil the industry he comes from is a good example. If you raise the tax on success, you get less of it. The oil majors abandoned the North Sea when Brown was Chancellor due to his Windfall Profits Tax. Now they are coming back, with BP spending £5 billion there in the next five years. Aberdeen is booming once more.
Marxists love to kill off capitalism, and in the process force the country into greater poverty. But that’s where they get votes from. It’s hardly surprising they have a predisposition to destroying wealth. Marxists love us to be in debt which cripples our efforts to better ourselves. Wealth is their dirty word.
CONSERVATIVE HOME –
No, the biggest problem with Cable isn’t his views on banks, but his stance on tax. He conceded yesterday at a fringe meeting that higher taxes bring in little extra revenue, but are there to ensure that – as he put today – “the broadest backs carry the biggest burden”. He itemised for the Liberal Democrat’s victories on tax: no inheritance tax cuts, the capital gains tax rise, income tax reductions for poorer workers only.
Indeed, he went further by banging on about his beloved mansion tax, regretting that it hasn’t made it into the Coalition Agreement. And he emphasised his own personal commitment to higher taxes in the form of a graduate tax of some sort, which he told the conference he was pushing for “as best I can”.
The Tap Blog is a collective of like-minded researchers and writers who’ve joined forces to distribute information and voice opinions avoided by the world’s media.