Most charities exist to relieve poverty. The IEA goes out of its way to prove it is all about increasing the concentration of wealth. For example:
Butler is particularly critical of capital gains tax, which reports indicate the new Labour government could increase in a forthcoming budget. He says taxing capital gains discourages savings and investment, resulting in lower productivity, wages, and growth.
Most of these claims are totally unproven. All abolishing CGT would, for example, actually do is reduce the tax rate on the wealthy, and cut government tax revenue, which the IEA claims must then be matched by reduced government spending. Increasing wealth for a few whilst denying services to the many is the very transparent agenda in this book
“Unproven” is the existence of deadweight costs of tax, which vary by type of tax? There are several Nobel Laureates who would disagree. Vehemently disagree with a retired accountant from Wandsworth.
Most charities exist to relieve poverty.
If you saw how much Directors of charities get paid then I’d have to agree – there’s one born every minute
How much can the Institute of Economic Affairs get wrong about tax? In the blurb for a new book it is publishing, written by its long-time associate Dr Eamonn Butler, it says in the first line:
Taxation may be necessary to fund public services, but policymakers must consider its moral and economic costs.
Seems reasonable to most mainline economists.
As opening howlers go. that’s a good one. Tax never funds government spending. Money creation by a central bank does that. It has to in a fiat-money economy or there could be no government-created money in existence.
Clearly channelling Goebbels – claiming that if he asserts something alongside the various other lunatics pushing MMT then it becomes the truth.
Tax then exists to control inflation and for social purposes. Publishing a primer on tax in which you reveal you do not understand what tax exists to do is pretty good going for a supposed educational charity.
This is at best a partial definition of tax and one which ignores a great deal oftresearch but actual economists and financiers (As opposed to fradulent accountants masquerading as academics)
Most of these claims are totally unproven. All abolishing CGT would, for example, actually do is reduce the tax rate on the wealthy, and cut government tax revenue, which the IEA claims must then be matched by reduced government spending.
I don’t believe he’s advocating the abolition of CGT but his comments about reducing government expenditure are unarguable unless one has a vested interest in seeing the economy go to rack and ruin to an even greater degree.
Increasing wealth for a few whilst denying services to the many is the very transparent agenda in this book, and never more so than when the IEA says:
The book challenges the notion that progressive income taxes are always fair or beneficial. Butler points out that high marginal rates on top earners can reduce tax revenue through avoidance or decreased economic activity. A study found that raising the top income tax rate would reduce total GDP by almost three times the revenue raised.
The argument here is that of the utterly discredited Laffer curve. How can they still be banging on about that when the effect does not exist at any known tax rate, except, maybe that on moving from universal credit into work?
Who has ‘discredited’ the Laffer Curve? Murphy isn’t fit to tie the man’s shoelaces.
And finally, they note:
The book concludes by exploring alternatives to taxation for funding essential government services, such as user fees, private provision, and better utilisation of state assets.
So, privatisation and US-style healthcare, which is utterly inefficient and fails to provide a service to vast numbers of people, is their prescription.
Or perhaps private sector provision matching the overwhelming majority of European countries which seem to have far better outcomes than the NHS.
Pretty desperate stuff really from a man who I think must suspect his day in the sun will never come.
So what is the argument for progressive income taxes are always fair?
Has he got anything other than the rich don’t “need” all the money?
“several Nobel Laureates”: you are presumably referring to the counterfeit Nobel prize? Appropriate, I suppose, in a post about a counterfeit economist.
CGT, more often than not, is just a tax on inflation.
“Most charities exist to relieve poverty.”
I find that very hard to believe. Statistics seem to be very hard to find, but a quick look at the top ten charities by charitable expenditure (https://register-of-charities.charitycommission.gov.uk/sector-data/top-10-charities) suggests poverty is a minority concern. The others are:
Medical research: Wellcome Trust, Nuffield Health (possibly some healthcare for the poor), Cancer Research UK
Culture: Arts Council, British Council, National Trust
Education: United Learning LTD, Cardiff University
Of the top ten, only Save The Children International seems to be aimed at relieving poverty, and the tenth organisation, The Charities Aid Foundation seems to be a meta-charity, so its efforts could cover a wide range of areas.
There’s a vast number of charities, some of which are tiny, including sports clubs, art galleries, orchestras, schools etc. It seems very, very unlikely that most charites aim to relieve poverty.