Given that the next election is possibly 5 years away, am I the only one to find arguments about Labour’s election strategy just a little premature? I keep trying to remember what such discussions must have been like for the Lib Dems in 2005, and then find I can’t. Because five years is such a long time … What is that saying about a week in politics?
But there are some excellent discussions, and I can’t ignore this one: between Julian and the Fink on Comment Central.
Meantime (and thank goodness, for this policy oriented blog), the discussions about POLICY are restarting. Here is the excellent Rick on May 2012, and a Grand revolt against the Immigration Cap. Rick is an HR guru:
A combination of factors has meant that, five months into the year, the 2012 immigration cap has already been reached. Unemployment has fallen rapidly as the economy has improved and ideal weather conditions have caused farmers to bring in foreign workers to prepare for a bumper harvest. There has been little interest from local people in jobs at the Olympic Games, so London 2012 sent out an urgent appeal for migrant workers in January. The annual cap on migrants was reached a few days ago when EasyTandoori, the joint venture between Stelios Haji-Ioannou and Gulam Noon, brought 500 Indian waiters and kitchen staff to the UK, in preparation for the opening of its restaurants later this year.
Ian Cowie of the Telegraph is more, well, Telegraph-ish about the prospects for people suffering higher CGT bills.
Investors with substantial portfolios of property and/or shares who have not protected them in tax shelters – such as trusts, individual savings accounts (Isas) or pensions – face the daunting possibility that HM Revenue (HMRC) may grab half their gains.
If you are a reader with substantial wealth, it is a very expert and informed piece that may help you work out what to do to protect your wealth. If you are NOT such a fortuante person, it is an intruiging insight into the amount of brainpower and cunning that goes into protecting the wealth of people who have the ‘problem’ of how best to sell their artwork, racing cars and second properties.
I think CGT is an important issue. But I am most exercised about the people starting up value-added business that end up making the whole economy grow well, not the multi-generational maintenance of wealth hordes. There are dilemmas, sure – the sanctity of property, social justice clashing as always, blah blah – but I am more concerned about the truth or otherwise of the complaints of Private Equity managers:
The British Private Equity & Venture Capital Association, which represents the industry, said it would be “bizarre” if the sector’s capital gains were taxed as non-business gains. It said the generous exemptions for entrepreneurial business activities should “obviously” be applicable to private equity and venture capital, highlighting “the positive role that private equity and venture capital are playing in the recovery”
I am an empiricist. All sorts of things might be true in theory about taxes, but we need to know what actually happens. For example, the Right loves to construct a narrative in which the Government is the whole cause of the financial crisis. Sure, you can ‘construct a narrative’ (read my review of Norberg for an example). But is it true? Barry Ritholtz takes it to pieces – see this post on Economist’s View, concluding in damning fashion:
I demand evidence, data and facts. The blame Fannie & Freddie crowd have managed to remain blissfully data free. They have steadfastly ignored all calls for proof. Its way past the time to call out their intellectual dishonesty. If you cannot show any data, if you cannot prove what you are alleging with actual facts, you need to be called out for what it is you actually are: Proponents of a failed philosophy.
The version over here is our own dear IEA, so very right in the 1970s, but so pure and religious in their views against taxes that they go to the extremes, those extremes where your views are just ignored for being predictable in advance. Consider their post asserting that inheritance tax is a tax on entrepreneurialism. I keep asking where the proof is, and I keep getting fanciful, evidence-free theories back. There is huge cash wealth in this country. Asserting that IHT prevents the venture capital industry getting what it needs is just daft.