“We are skint, and it’s getting worse”, warns Brexit’s Nigel Farage as his Reform UK Party launched its economic plan for the UK General Election, giving British workers a tax cut to get the economy moving again.
Nigel Farage and Richard Tice announced the Reform UK Party’s proposal to liberalise tax rules in the UK on Monday, calling for a considerable £40 billion tax cut to promote economic growth and for a change in the way the Bank of England deals with interest payments to free up billions of pounds to pay for it.
Erstwhile Party President and, until the recent surge in donations and new memberships the principal underwriter of Reform UK Richard Tice wrote in an accompanying article that “The British worker is being suffocated by Tory taxes. They are disincentivised to work hard, effectively punished when they do so.” The answer, he said, is a “Great British Tax Cut” that would lift millions of workers out of paying tax at all.
“People are struggling to breathe under the burden of taxation”. Yesterday, Richard Tice explained Reform UK’s plan to make life easier for British citizens, get people back into work and drive economic growth. #BritainNeedsReform #GreatBritishTaxCut pic.twitter.com/E50ukDOIsE
— Reform UK (@reformparty_uk) June 11, 2024
Under present British rules, all income under £12,570 ($16,200) a year is income tax free, a floor which has slowly risen over the past decade but which has been left behind by roaring inflation. Tice proposed a major jump, taking all earners up to £20,000 ($25,000) out of income tax completely, equating to around seven million people. This would also mean a considerable tax cut for working people, given the £20,000 tax-free band is the best part of the national median wage at around £35,000 ($45,000).
Tice said he would also liberalise the tax rules for the self-employed, recently tightened up by the Conservatives to put them on par with employed people, and increase the threshold at which businesses start paying VAT (sales tax) from £90,000 to £150,000 ($190,000), giving small companies a big boost.
Speaking on Monday, Nigel Farage criticised both the government and the Labour Party — who will very likely lead the next government this summer — for engaging in a conspiracy of silence over the enormous levels of government debt. He said: “projections are whatever party wins, next year’s deficit will be around £100 billion. So we need to face up to one or two realities. We are skint, and it’s getting worse. And at some point in time we may even have trouble issuing gilts, government bonds.”
This was not discussed at all, he said, and stated the way to improve the economy was to help it. Farage continued: “the only way out is growth… putting up the tax threshold to £20,000 would be a very, very big step in the right direction”.
The plans have been criticised, particularly by the Conservatives, who seem to have very much fallen out of love with the Laffer curve approach to maximising the economy in recent years, with several Tory figures calling Reform’s call to cut unaffordable. Some economists have further said Reform’s plan to change the way the city deals with quantitative easing feasible, while warning doing so could act as a “tax on banks”. To what extent Reform seem to care about that is debatable, indeed as Mr Tice remarked on Monday: “it has long seemed that the state is captured by the City of London.”
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