"Tax the wealthy to atone for Osborne's raid on the poor." That was a headline in an article in the FT this week. Its author, Janan Ganesh, suggests that George Osborne's attempt to change the UK's distortionary and expensive tax credits policy looks like a "vindictive war of choice" on the poor, because he has not also "picked a conspicuous fight with people of entrenched wealth" at the same time. He should, says Ganesh. It is time for a proper wealth tax.
Hmm. There are two points to make here. First, cutting tax credits (which are not a credit, but a benefit) isn't just about the poor. As James Ferguson pointed out last week, it's possible to earn the pre-tax equivalent of £50,000 while inside the benefit system. That's just not poor. And it has to end.
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