Sunday, January 15, 2006
UK Overtakes Germany- In Tax
A depressing article in The Business, reporting how Gordon Brown's tax and spend policies are dragging us behind supposedly high tax Germany:
"The UK fiscal burden will hit 42.4% of GDP this year. By contrast, the fiscal burden in Germany will fall to 42.1% of GDP, less than Britain’s for the first time in recent history. Britain will also outspend Germany from next year, OECD figures show. In 2007, German government expenditure will fall to 45% of GDP, while British public spending will hit a new high of 45.7% of GDP."
As we've blogged many times, higher taxes mean slower long-term growth. Gordo's 4-5% increase in the proportion of GDP going in tax will likely reduce our trend growth rate by about 0.5% pa.
Under Labour, Britain has lost its position as the low-tax enterprise capital of Europe. And we will all pay for years to come.
Posted by Mike D at 9:35 pm