The National Debt

[Napster]

Removing tax on savings interest would be a good move. Many people rely on interest to survive and this would be a simple way to help those that have made provisions for their futures.

Not a bad idea. But unfortunately, not the right one at the moment. The problem is in the credit available. The government needs to make more credit available to free up spending and so-on. It's not about helping people, it's about getting people to spend and stimulating the economy. Removing tax on savings interest won't do that, it will do the reverse.

 

[RobM]

But removing tax on savings would stimulate spending...wouldn't it?

 

[Irate Ian]

But removing tax on savings would stimulate spending...wouldn't it?

Interesting question. Wonder what you think the answer is ?

Removing tax on unearned income suggests to me that most would simply retain and build up their savings rather than spend it.

 

[Napster]

Interesting question. Wonder what you think the answer is ?

Removing tax on unearned income suggests to me that most would simply retain and build up their savings rather than spend it.

You're right.

By the way, Aaronovitch in the Times today also advocated a Keynesian approach of increasing government spending. That leaves just the German guy and the Tories advocating a do-nothing approach.

 

[Andyhsufc]

I think that the VAT cut will make a difference whether it is passed on or not.

If it is passed on, then people will spend more. A small personal example would be that yesterday I bought 2 CD's for £10 which, with the VAT cut, came to £9.79. Now, I then went to a newsagent and bought a pack of chewing gum with that 20p so that is 20p which would have gone to the taxman which is now in a shopkeepers till. All the 20p's here and there will soon add up across the country.

If it is not passed on, then it will be just more money in the shopkeepers pocket which is surely not necessarily a bad thing with the absence of credit for SME's in particular.

 

[Irate Ian]

You're right.

By the way, Aaronovitch in the Times today also advocated a Keynesian approach of increasing government spending. That leaves just the German guy and the Tories advocating a do-nothing approach.

Don't know what a Keynesia approach is, but call me a renegade, I suggest the exact opposite by reducing our national overheads, in a big way.