Labour threatened to impose a wave of taxes on British industry and the financial sector yesterday, provoking intense criticism from business groups and City leaders.
Its manifesto revealed an £11bn windfall tax on the oil and gas sector; further tax raids on dividends, capital gains and financial transactions; a mechanism to delist companies from the stock exchange if they do not take “adequate” measures to tackle climate change; and the nationalisation of water companies, energy firms, trains, buses, and the Royal Mail.
They don’t – emotionally, let alone more technically – grasp that these things don’t just happen. Business does not just exist, profits are not just made, transactions don’t arrive out of the air. People work to make them happen. And if you reduce the incentives enough through taxation then they’ll not do the work and the events to be taxed won’t happen.