Block out the bitter leftists and budget is great first step.

 

Make no mistake: the Government’s growth plan announced last month is a great first step.  

  

Of course, sour leftists and the metropolitan elites hate it. As so they should.   

  

There was a welcome emphasis on cutting both business and personal taxation. High taxes, by their very nature, make most people poorer and lead to perverse outcomes as they stifle risk-taking and personal responsibility whilst increasing the ranks of administrators ‘employed’ to manage transferring money from one set of citizens to another.  

  

The proposed cut in basic rate Income Tax to 19% from April next year will boost individual spending power, meaning consumers will have more money with which to make purchases.  

  

The reversal to the increase in both individual and employer National Insurance  contributions will put money back where it belongs: in our pockets.

  

The decision to withdraw proposals to hike Corporation Tax from 19% to 25% will be a real incentive for businesses to invest here in the UK (in 2019 UK business investment was just 10%, well below the OECD average of 14%).   

  

The same can be said of the decision to make permanent the temporary £1m level of the Annual Investment Allowance, with firms being able to deduct all of the costs of new plant and machinery purchases.   

  

The reductions in stamp duty should improve social mobility as people will pay less for moving up and down the housing ladder.    

  

I was very struck by the concept of investment zones, areas which seek to attract companies with 100% relief from business rates and other tax reductions. I hope that Suffolk, whether in whole or part, can be included in the scheme.  

  

And of course, there were the first efforts made to roll-back EU-era red tape and over-regulation. These include reforms to off-payroll working rules (IR35) and the deregulation of the UK financial services sector.  

  

Yes, I’m talking about bankers’ bonuses! In spite of the knicker-wetting hysteria from the likes of the Guardian, this scheme should attract additional talent away from Frankfurt and New York. And that talent will pay 40% Income Tax on their salaries in this country. In other words, every banker earning £1m will pay £400,000 a year in taxes to boost the number of NHS nurses or similar.   

  

Why do I refer to Kwasi Kwarteng’s ‘fiscal event’ as a good first step?  

  

Because he needs to go further in creating a prosperous economy and society that proportionately rewards effort and ensures that individuals and households keep far more of the wealth they create than at present.  

  

I want him to go much, much further next time by scrapping some taxes altogether, including stamp duty and IR35.  

  

Of course, some of those taxes will be recouped by the VAT take, driven by higher consumption levels based on decisions taken freely by individuals and organisations. That said, I think longer-term lower taxes can only be guaranteed through cutting the size of the bloated state through reducing its functional reach and the number of public sector workers employed.  

  

If they are truly any good, then the private sector would be only too happy to recruit them, especially during a time of historically  high job vacancies.   

  

The Government could always start by streamlining the shambles that is the utterly bureaucratic and anti-business planning system – and not only in investment zones. My own experiences of the system convince me that it should be rebranded as the business-destruction unit.  Yes – I’m talking about you Babergh/Mid-Suffolk and all your council colleagues nationwide! 

 

It is also imperative that the Government re-opens its manifesto commitment to holding a full review into the increasingly complex and perverse Business Rates system that seems to penalise so many firms, including my own. I would urge that any review also includes an unbiased and complete consideration of alternatives, such as a sales or turnover tax which is much more transparent and simpler to collect.  

  

My other concern about this tax-cutting and pro-growth agenda is that it needs a longer-term second phase to lock-in sustainable prosperity.  

  

Just as Government needs to stop interfering in most day-to-day aspects of people’s lives, it does need to increase its legitimate role in securing future growth.   

  

I do agree with the Suffolk Chamber of Commerce statement which said: “We need a redoubled national programme of capital investment to achieve a generational shift in our core infrastructure: road, rail and mobile. A purposeful programme of infrastructure upgrades will be like a magnet in drawing the skills base of Suffolk in an upwards direction, including through the Suffolk & Norfolk Local Skills Improvement Plan, which is being run by Suffolk and Norfolk Chambers of Commerce.   

   

This means the upgrades at Ely and Haughley rail junctions need to be approved this autumn, with the long promised improvements to  the whole of the A14 in the county – signed off as soon as possible afterwards.  

 

So, in short the ‘fiscal event’ and Government growth plan is to be welcomed. It’s what comes next that really matters.