Wednesday, May 23, 2012

Tax policy report by UK anti-tax group

Whenever a "report" on tax policy begins with artwork depicting oppressed people in chains, I brace myself for a now familiar chorus about the terrible impact of tax on jobs, growth, productivity, freedom, beauty, and truth.  The UK Taxpayers Alliance "Single Income Tax: Final Report of the 2020 Tax Commission" fits the bill.  Richard Murphy summarizes its overall tone and describes it as a horrid world view.  At over 400 pages long, it's not a light read.  I've only skimmed it but note that the report very quickly dismisses the important work by Piketty & Saez as weak empirically (p. 246), yet blandly summarizes US Congressman Paul Ryan's outrageously lopsided budget plan with no critique whatsoever (p. 390-91).  That's telling.  The foreword says:
"The level of economic and policy debate has long been poor in the UK. There is very little awareness of the oodles of academic research on how high marginal tax rates or punitive income or capital taxes reduce growth and jobs."
Aside from using the term "oodles" in a purportedly serious study, that's an aggressive opener that lets us see the framing that will go to work in this report.  The author complains that "In the very rare instances when they are mentioned, respectable and important studies are dismissed out of hand or not properly understood; the only “moral” arguments ever referred to are those that advocate the state seizing ever greater proportions of individuals’ incomes."  This leaves us in no doubt of the direction and makes the easy dismissal of research by people like Piketty & Saez even more bothersome.

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