An imprudent Budget measureby
A rather resentful Imprudent Accountant suggests a levelling up tax raising measure that could find its way into Wednesday's Budget speech.
I was brought up to believe in behaving modestly. That meant, amongst other things, never considering biting the hand that feeds you.
However, sometimes people just go too far or, in this case, not far enough. The powers that be at AccountingWEB probably do not realise the hurt they have caused by inviting various favoured columnists to present their fantasy budgets but then cold shouldering yours truly.
It is a bit late in the day but since Rishi Sunak still seems to be leaking new measures on an hourly basis, even through the night, I thought the least I could do was throw in a single, carefully constructed measure that will contribute regally to his government’s treasured policy of “levelling up”.
It appears the Chancellor is struggling to find policies which hit the rich far harder than the aspiring rich; for example, failing to notice that, if you are rich enough, national insurance contributions are something that other people pay.
His ignorance of this fact seems strange, since it is highly likely that the greater proportion of money flowing into his own family coffers will fall way outside the parameters of this pseudo-tax.
Forget supply-side economics
Where I think that he and so many commentators have been going wrong is focusing on the income side of the equation. This might be something to do with supply-side economics, though my A-level studies are so far back that I can’t be entirely sure.
My plan is to attack the problem of financing the nation and filling the pandemic and Brexit black hole from the other end, using a methodology that might have been eased considerably as a result of regaining a drink which I believe the government repeatedly refers to as Sovereign Tea and was apparently banned under EU regulations.
Personally, I’m delighted to have the opportunity to relish our Sovereign Tea. Although unfortunately, the local supermarkets appear to have run out of this delicious beverage along with so much else that used to sit on steadily emptying shelves.
I think that the solution to many of our ills is to increase the rate of VAT on luxury goods.
Some smart alec will point out that this breaches the Conservative Party’s manifesto promise not to increase the rates of income tax and NIC or VAT. In retrospect, they will realise that this measure will merely complete the set, since the promises on income tax and NIC have already fallen by the wayside.
There are two considerations to implementing my plan. First, defining a luxury good and secondly determining the appropriate rate of VAT to charge.
Rate of VAT
To put the cart before the horse, my original thought was that we should increase the rate of VAT on luxury goods from 20% to 25%.
However, on reflection, that would be merely tinkering around the edges. Instead, I think Mr Sunak would be far more ambitious and impose a rate of 100%, perhaps increasing this to 200% of any goods imported from those blighters in the European Union who were callously stealing our Sovereign Tea.
Defining Luxury Goods
I was concerned that this might get tricky. However, there is an obvious solution that will undoubtedly delight the United Kingdom public.
Let’s use a prime time Saturday night TV game show with experts opining on different types of good and utilising voting by members of the public to decide on which goodies get hit right between the eyes.
Do you reckon Alan Sugar and Richard Branson might be good bets to mouth off about the kinds of things that fill their homes? Perhaps Sunak might like to make a guest appearance to boost his profile as well?
This could be great fun: superstar models could show off fur coats and jewellery, geeks could talk about expensive electronic goods and top footballers fill in the gaps between.
If this is all too complicated, then my alternative ideas include super taxing any item that graces a property in Downing Street, where even John Lewis is sneered at, or possibly anything sold by a selection of stores that could include Harrods, anywhere with an outlet on Bond Street and, quite possibly, the aforementioned John Lewis.
Without wishing to appear immodest, this plan really is brilliant. Anyone in those Northern climes that Tory politicians seem so keen to help should be pretty much exempt from the higher tax rate, particularly since there are no lorry drivers available to ship luxury goods to their locale anyway.
Even better, this would be a completely voluntary tax and the very rich will not care about extra expense.
Indeed, for many it is a cachet to boast about spending far more on a car/yacht/set of curtains to ensure that you keep well ahead of the Johnsons (oops perhaps that should read Jones’s).
I commend this mini-Budget to Madam Deputy Speaker.