Double-cross by Ron Banks
Centre for Land Policy Studies, 2002. 58pp.
ISBN 1901202038 £6.95
Banks's book is written in a hard-hitting style, and offers a clear-as-crystal expose of Britain's tax system. Double-cross is the second book in the Inside Story series, which was launched with Don Riley's Taken for a Ride.
As the cover blurb has it: “Banks exposes the dangerous fallacies that underpin Prime Minister Blair's claim that taxation delivers equity and efficiency. The ugly truth is that Governments destroy people's capacity to produce incomes that would enable them to finance the private and public amenities they need. Banks estimates Treasury taxation policy “deprives each man, woman and child in Britain of £15,000. The figure is based on the methodology developed by Prof. Nicolaus Tideman of the Virginia Polytechnic Institute and State University. This, Banks adds for clarification, is on top of the taxes Gordon Brown collects from us, adding: “should we trust Gordon Brown with the public purse?
Treating each of our individual traditional taxes separately, Banks calculates the per capita loss attributable to each instrument, based on UK public. Banks calculates the effects of over twenty different taxes identifying sources of public revenue which are neutral or benign, and highlights those which are fiscally destructive.
His list of bad taxes is headed by income tax, which he claims costs a staggering £5,061 loss to each of us simply by virtue of the lost incentives that levying it builds into our economic system. Similarly, the use of value added tax as a sales tax, costs the economy a total of £188 billion.
The total deadweight loss to the UK economy, caused by the way we collect public revenue, Banks estimates, is in the order of £882 billion. But Banks regrets the lack of properly analysed and detailed public information that is available for supporting his arguments: and he laments the ease with which the politicians and civil servants are able to fool both us and themselves into not seeing the problem.
Banks presents an alternative. “The ultimate target is a simple one says Banks forcefully, it is “raising public revenue without losing a penny of the private income that people would like to produce and keep.
Banks argues that democracy requires us to demand of our representatives that they supply the information we need in order that we can make informed choices about how we want public revenue to be raised. He argues too for a redefinition of the public sector, and of public service. But most importantly, he argues for a shift in Å“the revenue base away from people's wages and savings and on to the community-created rents of land. This, in Banks' view, “would deliver a politics that did not rely on hoodwinking voters.
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