Democrats here in the US insist that higher tax rates mean higher revenues to the Treasury. Time and again they’re proven wrong, but that doesn’t stop them from repeating the lie. Today all we have to do is look to our friends across the pond for more proof that increasing taxes on the rich means decreased revenue to the government.
The Treasury received £10.35 billion in income tax payments from those paying by self-assessment last month, a drop of £509 million compared with January 2011. Most other taxes produced higher revenues over the same period.
Senior sources said that the first official figures indicated that there had been “manoeuvring” by well-off Britons to avoid the new higher rate. The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.