tag:blogger.com,1999:blog-6606798.post6083527819189924731..comments2024-03-28T22:32:50.562+00:00Comments on Liberal England: Lib Dem tax cuts would be fiscally neutralJonathan Calderhttp://www.blogger.com/profile/00730157683743989696noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-6606798.post-35046692602767685852008-10-22T14:47:00.000+01:002008-10-22T14:47:00.000+01:00As I understand it the 16p tax rate (i.e. a 4p cut...As I understand it the 16p tax rate (i.e. a 4p cut in the basic rate) will be paid for by increased taxes on wealth and green taxes. It would be a revenue neutral package. The second £20bn package of savings in public expenditure would largely be used to increase spending in our priority area e.g. cut ID cards to pay for more police. If there is any money left over then further tax cuts will be made.Peter Blackhttps://www.blogger.com/profile/16370260756872929021noreply@blogger.comtag:blogger.com,1999:blog-6606798.post-87827254393632900972008-10-22T00:31:00.000+01:002008-10-22T00:31:00.000+01:00Fair point, though the "fiscally neutral" phrase c...Fair point, though the "fiscally neutral" phrase came from St Vincent of Cable on The Week. The posting should be headed "Lib Dem tax cuts would be mildly deflationary".<BR/><BR/>The important point - the the Lib Dems are not proposing Keynesian reflation - still stands.Jonathan Calderhttps://www.blogger.com/profile/00730157683743989696noreply@blogger.comtag:blogger.com,1999:blog-6606798.post-47346152733162564832008-10-22T00:14:00.000+01:002008-10-22T00:14:00.000+01:00A fiscally neutral tax cut would be deflationary r...A fiscally neutral tax cut would be deflationary rather than reflationary because the multiplier for tax cuts is less than that for public spending. The total level of spending in the economy would fall because a proportion of the money given away in tax cuts would be saved rather than spent.Anonymousnoreply@blogger.com