Windfall taxes are back in the news. The only surprise is that it took this long. After all, governments in financial trouble have only two real choices: they can dramatically cut public spending; or they can have a good look to see who has cash and they can help themselves to it.
I've said here several times that it makes sense to be cautious when investing in defensive' companies for the simple reason that the thing that makes them attractive to you cash and cashflow makes them attractive to the government. That was a point nicely proven by Sir John Major's call for a windfall tax on utility company profits this week.
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