It’s not just the US National Debt that’s out of control. In Great Britain, there’s also a crucial problem with rising expenses and lowered revenues. Or rather, rising expenses outpacing revenues. According to the Chancellor of the Exchequer of Great Britain, George Osborne, the only chance Great Britain has to fight off its debts is to raise the VAT to a staggering 20 percent.
“Higher income tax or higher national insurance … these two things I think would have a greater impact on work incentives, on competitiveness of the British economy. I think they would cost jobs,” said Osborne in an interview with BBC Radio. He added, “Most economies and certainly the best international evidence … is that countries with big deficits should increase their indirect taxes. It’s a structural tax change to deal with a structural deficit and a structural increase in expenditure that happened.”
Or, you could cut expenses. Granted, governments hate that (and more socialist governments loathe it), but you can only tax the people so much before you run into trouble and the VAT increase is going to really hurt the poorest, rather than tax those with the means to pay the extra tax.
Tags: VAT, George Osborne, British government to raise VAT, VAT rises to 20 percent, value added tax, Great Britain raises VAT to 20 percent, tax increases, raising funds, government raises taxes to generate funds, tax increase
