If you tax something you get less of it.
The Centre for Economics and Business Research (CEBR) has worked out that 0.5p increase planned for April 2011 will lead to smaller companies shedding so many staff that the increased tax take would only make a small additional contribution to the public finances.
The job losses alone would cost the Treasury around £900m in jobseekers allowance and other benefits, the centre said. It would come at a time when the Government is spending £1bn in an attempt to create 150,000 new posts.
If you tax jobs then you\’ll have fewer of them.
This really isn\’t rocket science you know.