Alistair Darling wanted to increase VAT to a much higher rate but was blocked
by the prime minister.
Cabinet sources told
Guardian the chancellor wanted to increase VAT to more than 17.5% but was
convinced by Gordon Brown to raise national insurance by 0.5% instead.
Follwoing the announcement this week shadow chancellor, George Osborne, said
the rise in NI is a tax on jobs.
Guardian calculated that a 1% rise in NI should raise £4.48bn for the
country in a year. In contrast a 1% rise in VAT will generate more at £4.8bn.
The Tories claim the impact of the NI rise to the NHS will increase by £446m
in employer contributions alone.
It is estimated returning VAT to its original rate of 17.5% on 1 January will
restore £12bn in revenues for the country.
Does Darwin's theory apply to taxation? Colin ponders...
The UK tax gap fell in 2014-15 to its lowest-ever level of 6.5%, revealed official statistics published today
Changes to the tax system is urged to support the growth of entrepreneurs, found a report from the Grant Thornton UK, the Institute of Directors, and the Prelude Group
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states