racing to drive Conservative Party It can be compared to a cartoon TV series crazy cars. You have to see how the characters manage to make their economic engines go faster. Candidates are vying to shake off the brakes with promises of tax cuts.
Tax cuts are understandable. The overall tax burden is heading to its highest level in 70 years. Inflation provides more fiscal room to maneuver. This, along with increasing public sector efficiency by around £10 billion, is enough to cut £40 billion in tax, says the candidate. Sajid Javed.
But using fiscal space to cut taxes is risky. That means sharp cuts in public wages and will limit the ability to respond to other demands, from increased defense spending to helping those hardest hit by rising energy prices.
Ineffective tax systems act as a brake on growth, but the problems plaguing the British economy will not be solved by immediate tax cuts. Cleaning up public finances should be a priority.
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