Who understands the economy and growth/ tax cuts?

[Liz1tummypain]

Hi mumsnetters! Hoping for some wise or at least interesting views on this. A lady on the radio just said that tax cuts in general can't be said to stimulate growth. She says its meaningless to talk about tax cuts without saying whose tax is being cut. UK growth is really lagging compared with US, EU and other such economies and we need to take steps to encourage growth. So what besides tax cuts can politicians/ chanceller of exchequer etc do that stimulates growth? Any ideas on this please?

Many thanks :)

Not sure who she was. But the taxes which the Tory hopefuls are hoping to cut are nics (reverse the 1.25% increase), possibly corporation tax which is set to increase by 6%+ depending on profits from April and Mordaunt also mentioned fuel duty.

the idea is - for individuals if we have more money in pockets we spend more = boost economy and VAT take goes up

other ways to assist growth - look at incentives for capital spend by companies (the government is doing and tom t mentioned full expensing which is one option)
improves business environment - reduce regulation, make it easier to recruit (visa schemes) and so on

re tax policy look at the ifs website

Ok thanks Noto ironing. Perhaps it's not something most people have much of an opinion on. Cheers :)

But if most of that money goes on increased rent, food and heating we aren't boosting anything ?