Posted by Stephen \(aka steford\) on 09/13/05 19:32

Gunther Gloop wrote:
> Tinkapace wrote:
>> Look its simple the Government has to raise money, fuel tax ain new
>> so its not there fault, if they reduce it who makes up the difference
>> ? As a country we have an income just like an individual or familly.
>> If its reduced there is less money to spend. Unless they tax
>> something else or reduce spending simple as that. Its not like its a
>> new tax is it I am all for paying less cash but I do not want it just
>> shifted somewhere else because I drive and it effects me.
>
> I really don't want to get into a stoopid argument about this, but
> biggest hole in the above is that they don't have to "make up" for
> lost taxes when they're coining-in more money as it is from existing
> taxes. ie.
> eg. they were getting 17% of 80p. Now they're getting 17% of �1.
>
> They wouldn't need to "make up for lost income" as such.
>
But the theory goes that you spend 17% of the 20p difference less on other
VATable goods - so the chancelor loses out there. Net gain 0.

[Back to original message]