The second area Gordon could have worked some tax wonders was with the environment.
It’s easy to say that the polluter should pay – though does this really work? We all think that multinationals like BP, Shell, etc., should pay more if they pump nasties into the biosphere, but what about us? If you take the principle to the logical conclusion, we should pay more tax for the amount of rubbish we produce and pay more tax on the fuel that we use.
I wonder whether consumers are motivated more by ease and pleasure than by saving money. We could all save a lot of money by not going on nice holidays to somewhere warm and most of the people I know who drive could save lots by driving smaller cars – but the thing is – we don’t.
2. Reduce tax for good behaviour – 1p/£1 for each category
If we were to be encouraged to do good rather than punished for being bad, I wonder whether we’d do better. We could get tax breaks for doing good stuff. Perhaps a penny off income tax if you use public transport, another penny off if you reach recycling targets and a penny off if you switch to alternative energy use.
Companies could be encouraged by doing the same – less corporation tax if they behave well – rather than considering it as an extra cost. By giving a carrot rather than a stick, consumers and companies would have a reason to do good.
If you meet all the good criteria you have more money to spend to boost the economy (potentially inflationary) or to put into pensions / investments / savings. You will probably have spent some money to achieve some of the criteria needed to get the reductions in tax.
It might be that the reductions in your own pollution comes off your council tax rather than your income tax, but then that’s a topic for the next post . . . how to get your tax from you.