And as for what to do on April 22 – lest we forget it, budget day – the answer is simple. We do need a fiscal stimulus. Not less than £25 billion.
Mebbe, mebbe not. But that\’s not the intense joy to be found in his argument.
But I accept not all should be paid for by debt. Minimum tax rate of 32% on those earning more than £100,000 – removing all allowances to achieve this is a start. Make it 40% minimum tax on all earnings at £200,000. Charge NIC at 11% on all investment income over £5,000 pre annum (pensioners apart). Abolish the domicile rule.
He, err, wants to pay for a fiscal stimulus by raising taxes.
No, not got it yet?
A fiscal stimulus is when we increase the gap between the money being spent by government and the money raised by government in taxation. That\’s actually what it means.
So if you decide to raise government spending and fund it by raising taxes then you\’re not in fact increasing that gap. So you\’re not having a fiscal stimulus at all.
So, Richard Murphy\’s considered economic opinion is that we should fund our oh so necessary fiscal stimulus by making sure that it isn\’t a fiscal stimulus.