Osborne argues for flat taxes

8 Sep 05
Shadow chancellor George Osborne has urged the Conservative Party to make an economic argument for lower, flatter taxes.

09 September 2005

Shadow chancellor George Osborne has urged the Conservative Party to make an economic argument for lower, flatter taxes.

Speaking at a Social Market Foundation seminar on September 7, Osborne said that Conservatives had preferred 'to make an ideological argument about the size of the state, instead of an economic argument about Britain's ability to compete'.

Osborne argued that a flat-tax regime — in which all income over a stipulated allowance is taxed at the same rate — should form the centrepoint of the party's economic policy.

Osborne argued that, in the medium term, tax revenues would increase through higher compliance rates and economic efficiency.

'The war of attrition between accountants searching for loopholes and taxmen trying to sew them up is ended,' he said.

Osborne quoted from a leaked Treasury report, which described flat taxes as creating a 'virtuous circle' of tax cuts and economic growth.

However, a copy of the report obtained by Public Finance reveals that the section cited by Osborne only discussed theories and included a Marxist critique that was markedly less favourable to the idea.

PFsep2005

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