R-Words

The annual tax deadline passed recently (31st January) and all eyes were turned to the economy.

Derek Smeeton urges everyone to get your accounts up to date now because of the fragile state of the economy.

He says this is especially important to avoid higher tax rates which are due to rise from the start of the next financial year in April, and partiularly considering there is a prospect of further increases whichever party wins the general election.

RU Henley Business School graduate Alex Bernard gives an overview of the current economic arguments.

He points out the continuing "struggle between 'tax cutters' and 'dig a hole and fill it up [theorists]' is still a matter of debate. Even worse, economists do not agree on which, how much, and how, [to] cut taxes."

Alex is worried that the only available answer to the problems is to increase an inflationary spiral to pay for all the debt that has been racked up.

So he'll be interested in the range of reports that have been springing up to show how behaviour is being influenced during these straightened economic times.

BBC Berkshire's Emma Midgeley provides some vox pops from people on the street.


Recession & Recovery

Slough Labour activist Andy Peacock notes the predictions of 0.4% growth for the previous quarter and implores the public for votes with an emotive appeal: 'Don't let the tories crush the recovery'

However Conservative Wokingham MP John Redwood howls at the cynicism of another over-estimated forecast as adjusted figures come in showing the real level of growth to be only 0.1%!

Maidenhead's Alistair McRonald also picks up on the statistical event, marking the end of the period described by David Cameron as 'The Great Recession', which he says is brought about by Labour's "vast failed social engineering experiment."

However Reading's Adrian Windisch is ever-fearful that the news will bring only some temporary respite as the effects of the stimulus are short-lived and we head to a 'double dip' recession'.

The Green Party candidate thinks we should stop seeking to grow the economy because this inevitably leads to environmental destruction.

Elsewhere, Sandhurst's top Berkshire blogger, Mark Reckons, notes how the economic news plays into the election narratives adopted by the two main parties and may affect the date of the election - he says:

"If we were to find that we had dipped back into negative growth in the first quarter of 2010 just days before a general election that would be devastating to Labour and their electoral prospects."

Regulation & Reform

Libertarian Rob Fisher believes in reform - he explains how the current tax system involves a

"whole raft of coercive relationships, broken promises, illusions, lies, twisted assumptions and mental gymnastics that stand between me and my wages."

He says the concepts which currently support current tax philosophy are 'completely alien'.

Robin Smith asks the fundamental question: 'what is government for?'

The tory Wokingham town councillor is an advocate of systemic fiscal reform, which would involve introduction of a Land Value Tax scheme to stop the expansion of state and corporate power over the individual and prevent government and council budgets from becoming overblown.

Although he is not in the mainstream of his party's thinking he may be able to find some common ground with his opponents.

LibDem candidate for Reading East, Cllr Gareth Epps has been pushing his party's manifesto agenda - saying "We'll put fairness first!"

He describes how the LibDems "will introduce fairer taxes by closing loopholes for the richest, introducing a tax on mansions and tax cuts of £700 for everyone else" in a way which rebuilds the economy based on sustainable principles.


Oranjepan asks:
There is much needed to be done to sort the economy out, a decisive election will provide some direction but will it stop all the umming and ahhing?

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Meanwhile: Bank of England Chairman Mervyn King reports the annual rate of inflation has increased to 3.5% for the 12 months to end-January, from 2.9% in December - the highest level in 14 years.

Background: Countdown To The Budget