Posted by: bravo22c | 27/03/2010

Am I missing something again?

Another one I put up on MyT, which seems to be going reasonably well there – perhaps the trolls haven’t woken up, yet.

We are informed that a tax on the food we eat is being ‘considered.’ This at the same time as a rise in the rate of VAT to 20% is also mooted. We are also informed that members of parliament have voted themselves an increase in pay while millions of the people who pay for that increase are suffering pay cuts, or cuts in working hours that reduce their income significantly. Oh, Yes, and the same members of parliament are demanding that they travel, free, in First Class on the trains because, among other reasons, ‘there is not enough leg-room in standard class’ and, in standard class, ‘ it is not safe for a woman travelling alone at night.’

The increases in taxation are proposed ‘to cut the government deficit.’ Before asking whether there might not be other ways to decrease ‘government spending,’ a small discussion about the reasons for paying taxes might be worthwhile.

Why do we pay tax? I would suggest that, as a society, we agree to pay a certain amount of our income in taxation to fund those services that we, as a society, deem to be necessary for the efficient working of our society in our own best interest. We have also generally agreed that, as well as efficient, such services should be provided in a way that all of us are assured that our treatment in the provision of these services is equitable and fair. The key principle is ‘consent.’ We consent to pay taxes which we require, or should require, that those we elect to govern our society use in the fairest and most efficient way possible to manage our society on our behalf.

So, bearing the principle of ‘consent’ in mind, is there a way to reduce the government deficit without the imposition of more taxation? I would suggest that there is and that it is as simple as the application of the Micawber Principle:

‘Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.*’

Instead of increasing taxation, the blindingly obvious solution is to reduce expenditure. Lower expenditure, lower demand for taxes, increased opportunity for discretionary spending, increased demand for goods and services, increase in economic activity, more tax income, increased ability to pay for essential services… What, pray, is so difficult to understand?

Mr Micawber, of course, continues: ‘The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and, in short, you are for ever floored.’ Which would seem to be a pretty good summation of the prospects for this country unless MPs and wannabe MPs are given the message:

‘If you ain’t got it, don’t bleedin-well spend it!’

* Translation for those who have no idea what ‘nineteen nineteen six’ might mean.

‘Annual income twenty pounds, annual expenditure nineteen pounds ninety-seven and a half pence, result happiness. Annual income twenty pounds, annual expenditure twenty pounds two and a half pence, result misery.

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