Low tax - high expectations

It will come as no surprise that the Conservative-led UK government says lower taxes bring in more revenue, because the rich will come and business will spend. And it is not a surprise that left leaning parties disagree and say that such a policy will get the rich off the hook while poorer workers pay too much tax. UK finance minister George Osborne is trying to have it both ways. The UK will cut the corporate tax rate eventually to 22% and the top rate of personal tax from 50% to 45% - at a time of austerity. He says the top rate did not bring in the revenue expected. The rich do find ways around these things.On the other hand, Osborne announced a host of loop-hole closing when it comes to the super rich buying and selling property. This all in the name of fairness. London benefits greatly from non-citizens buying here. People from Russia, India, China and the Middle East buy properties in central London, and don't always pay the tax citizens do. But that is changing. Further, owners of any home worth more than £2 million will pay a higher rate of tax. The government is creaming a bit more off the top. Of course governments always promise to crack down on tax avoidance and to close loop holes. Can the UK actually do it? Cutting taxes for the rich will please Conservative voters. Raising the "Mansion Tax" will please others, though maybe not the non-doms who call London a second or third or fourth home. What it won't do is drive the rich from London. The government can and should take a bit more from those who come here for the freedom, schools, reliable services and lifestyle.