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| V.A.T the Useless Tax My old friend, the late Peter Kale, a former Conservative Councillor, appointed an Honorary Member of Grimsby and District Trades Union Council for his services to their campaign for regaining control over our fishing grounds (See savebritfish.demon.co.uk) argued that VAT in reality, raised not a penny in reality. Taxes on consumer spending are Keynesianism in reverse. By restricting demand, they cause bankruptcies and unemployment, reducing the input from Income Tax and National Insurance contributions, and increasing expenditure on all forms of social spending. Total abolition of VAT would reverse this process, leaving the Chancellor no worse off, and the rest of us much better off. It is also administratively costly. "Purchase Tax", initially levied to reduce demands for imported goods, was simply paid by the manufacturer, and added to the wholesale price. No office work was needed further. There are more VAT accounts for the City of Manchester, than there were Purchase Tax accounts for the entire UK. It is amusing to note that as a result of Sir Robert Peel's sweeping away the mass of indirect taxes levied to pay for the Napoleonic Wars, so liberating a flood of demand to fuel the Industrial Revolution, the fist English edition of the Communist Manifesto of Karl Marx and Frederick Engels omitted from its list of "Immediate demands", "Abolition of taxes on consumer goods" and "Introduction of a graduated income tax". In Volume3 of "Capital", they denounce agricultural protection, such as the Corn Laws abolished by Sir Robert at the price of sacrificing the most brilliant political career of his age. In a fascinating lecture, Peter said, that if Karl Marx and Adam Smith were alive today, they would vie in the intensity of their denunciations of the idiocies of "Europe". In Volume 3 of "Capital", he pointed out, Marx and Engels applaud Adam Smith's discovery of the law "The rent of land is determined by the price of the main crop". Apply that to the CAP. Smith did not advocate low wages. He says that where the workman is well-rewarded and contented, he is likely to be more productive than when ill-rewarded and discontented. His great hate was price-fixing and private monopolies. He wrote "We have laws against combination by workmen, but none against combination by employers". There is an historical precedent for the unity of Right and Left against the abandonment of policies of world trade, low indirect taxation and untaxed food, that have served all of us well for a century-and-a-half. The main obstacle is the ranting of the neo-liberals, whose absurd attempts to turn the clock back to the 19th Century in the face of the realities of giant transnational corporations, first applied fully by the bloody-handed dictator Pinochet, have spread a swathe of misery across the globe, and are now increasingly demonstrated to be without scientific basis, being more in the order of theology, "We are all so wicked and greedy, we cannot be trusted to take council together, and act for the common good, so it is safer to leave it to the hidden hand of the market". In contrast, the patriotic Left observes a commendable restraint. The writings of John Mills, Secretary of Labour Euro-Safeguards Campaign have been commended in the Conservative Eurosceptic Press. Even the Communist Parties advocate policies which, before Blair de-gutted the Labour Party of anything incompatible with "Euro-liberalism", could well have been advocated there. Let us all stress what unites us, and as far as possible, postpone those things which divide us until we are free to commend them to a free British people. Eric Clements Top |