With the new tax year upon us, individuals, families, and businesses are bracing themselves for a raft of tax hikes. From council tax and vehicle excise duty to employers national insurance and stamp duty land tax, Brits are under the cosh. The threshold freezes squeeze low, medium, and high earners alike.Â
Ministers would have you believe that all this pain is to restore the public finances. Rather than take a look at spending within their means, they want you to pay more. Of course the only way to get out of the mess is to support the businesses and entrepreneurs that actually create wealth, not that this lot seem to understand that. Indeed, new TPA research has exposed how little incentive there actually is to take the plunge and try something new.
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Crunching the numbers, Shimeon Lee reveals that an entrepreneur who hopes one day to pass something on to the next generation could find themselves staring down the barrel of an 84 per cent marginal tax rate - and thatâs after some reasonable tax planning!Â
When entrepreneurs earn, they often exceed numerous tax thresholds, save and invest their earnings, and ultimately pass them on to their children. As a result, the same money is taxed repeatedly before it is ever spent, leading to an exceptionally high marginal tax rate.
The research caught the attention of BrewDog founder (who knows a thing or two about starting a business) James Watt, and he cut straight to the heart of the problem on Linkedin: âAfter putting everything on the line â the long hours, the sleepless nights, the personal sacrifices â youâre left with barely 10-15p for every pound you generate here. Someone please tell me how that is fair?â
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In an op-ed for City A.M., John OâConnell was bang on with his assessment: âwe should remember the basics. If you want less of something, you tax it more â as most countries do with things like tobacco and alcohol duties. Why do we think the same doesnât apply to entrepreneurship? If we want more of it, we need to cut taxes.â
While you can read the full paper here, Atlanta Neudorf has provided an excellent summary in her debut TPA blog. Underlining why this matters so much, Atlanta writes: âIt is no secret that entrepreneurs are highly valuable to wider society, as well as to the economy. They create jobs, build wealth, and drive innovation. Britainâs post-pandemic business registration numbers were already falling in light of some of the highest tax burdens in our nationâs history. The current tax regime is pushing entrepreneurs away.â
If we ever want to get out of the high-tax, high-spend, low-growth death spiral, encouraging risk takers to go out and create the jobs and wealth we need has to be a top priority for policy makers. A tax system that hammers those who are prepared to put it all on the line will simply leave many asking âWhy risk it?â
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Trump, Trade & Tariffs with Ted Bromund
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As the impact of president Trumpâs âLiberation Dayâ tariffs continue to reverberate around the world, podcast host Duncan Barkes is joined by John O'Connell and Dr Ted Bromund, former senior research fellow at The Heritage Foundation.
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Given Ted's unique insight into the Washington political mindset, they discuss Trump, trade and tariffs, along with the possibility of a UK/US Free Trade Agreement. Give the latest episode of a nation of taxpayers a listen on Apple Podcasts, Spotify, and YouTube.
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Speaking of silly policies, ministers continue to push their bonkers plan to hand over the Chagos Islands to Mauritius and even have us pay for the privilege. Making matters worse, we learnt this week that the Mauritian government has come back asking for even more.Â
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With the bill estimated to be anywhere between ÂŁ9 billion and ÂŁ18 billion already, the idea of handing over even more is patently absurd. We need your help to put as much pressure on MPs as possible and put a stop to this ridiculous idea. Click here to write to your MP and help us stop the Chagos deal!
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Birmingham city councilâs been back in the news recently and, once again, itâs for all the wrong reasons. Europeâs largest local authority may have declared bankruptcy back in 2023 but, along with also bankrupt Croydon, it seems they still found the cash to dish out generous âgolden hellosâ.
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As the rubbish piles up and the rats run free in the UKâs second city, these payments look like yet another cock-up from the basket case administration. Elliot Keck was on the money speaking to the Telegraph: âBirminghamâs flimsy excuse about âhard-to-recruitâ staff doesnât wash - nor does Croydonâs deafening silence. Taxpayers deserve answers, not more reckless handouts from cash-strapped town halls.â
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The latest investigation for our investigations guru, Joanna Marchong, has revealed the dramatic cost of equality, diversity, and inclusion (EDI) staff in Britainâs quangos. Over ÂŁ26 million was spent on these tick-box titans between 2021 and 2024. The College of Policing and the Crown Prosecution Service topped the table with the most EDI roles. Talk about priorities.Â
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Joanna shared the news with the Telegraph, telling readers: âTaxpayers will be furious that EDI roles continue to plague the public sector. Despite ministers pledging to cut waste, these costly, unaccountable and counter-productive roles are still draining public funds.â
You can help push back against the right-on pen pushers by signing our petition to ditch the diversity demagogues here.
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The worrying love of the big state
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While Rachel Reeves may have made some high profile spending cuts (see winter fuel payments and minor tinkering to the benefits system), I doubt anyone reading this bulletin would seriously believe that her plans currently involve any significant efforts to control public spending.
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While we know this to be true, new polling has revealed that three in ten Brits say they think the current government is making bigger spending cuts than the coalition government, and a further 16 per cent see the current cuts as being on a par with the coalition era. Marking another debut on the TPA blog this week, Emma Revell of the Centre for Policy Studies explores the challenge faced by those of us who believe getting a grip on runaway public spending is key to our future national success. Emma writes: âYes, organisations like the Centre for Policy Studies, TaxPayers' Alliance and others need to work on how to rein in the runaway growth of the state. But we also need to work out how to sell the public on why.â Have a read of Emmaâs blog in full here.
Thanks for reading. Tune in next week for more.
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Benjamin Elks
Grassroots Development Manager
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