the one unexpected element, which was an increase in the dividend tax rate by 1.25%.
Dealing with the latter first, this should be seen for what it is. It is a sop to criticism. It supposedly addresses the issue of national insurance avoidance by those who pay themselves using dividends from limited companies. I have no particular problem with tackling that issue, but there is a flaw. The implication is that genuine investment income – the dividends received in ISAs and by savings institutions, interest and rents – should all remain exempt from this charge. Implicit in this move was another attack on working people as a consequence, with the very obvious intention being that genuine wealth should be untouched by the demand that it contribute to society. The bias could not be clearer.
Genuine wealth contributing to society by being, umm, invested in it perhaps? That capital stock does have to come from somewhere, after all. Whatever is to be said about MMT and money printing it’s still true that for there to be a capital stock someone, somewhere, has had to delay their consumption….