Gabriella,
Well played by Labour.
I did not support many of Labour's manifesto commitments - nice as they are I did not think they were economically viable.
But they were at least costed – which more that can be said for the tory “menu without the prices” approach.
For a start increases in Corporation Tax means more people have an incentive to pay accountants additional fees to save them from paying additional taxes. Accountants often charge a percentage of the tax saved so higher tax rates would probably mean the government collects less tax to spend on public services.
Speaking as a former partner at one of the Big 4 accountancy firms, corporation tax is already largely discretionary given the ease with which it can be avoided – see Starbucks, Amazon etc. All you need do for example is house the Group's intellectual property rights in a low tax off-shore territory, then charge your UK subsidiary a shed load of royalties for using the company name, thereby reducing its taxable profit here.
Worth noting too that the plans for higher corporation tax would have applied to profits over £300k, so not affected most small businesses at all.
Secondly my experience is that there are very few people in a private sector business who have the ability to make a significant impact on profits. My experience is that a talented few put in crazy hours because they are competitive and delivering results matter to them - they define themselves by it - and then delegate work and manage and monitor the people below them, who wouldn't achieve those results without their managers to manage resources, take risks, make strategic decisions. The few who are so good at their job that they are hard to replace (and the business would take a big hit without them) get paid a bigger share of the profits to retain them. Everyone else is not good enough at their jobs to be irreplaceable, regardless of how much training they get, because it's about drive, not education.
It’s also a lot about luck and happenstance – anyone can be a risk taker, but it’s dangerous to assume that those whose risks came good had any special insight. Either way though, I’m not sure how this relates to Labour’s corporation tax proposals?
Thirdly I support private and grammar schools - helps people with drive compete against other people with drive and the competition leads to higher achievements for the few. I know - Labour's manifest is for the many, not the few. If private and grammar schools were abolished, the smart or driven kids in the state school system would improves state school standards. But those smart or driven kids won't achieve what they could have achieved in the private or grammar school system.
I don’t. Private and grammar schools privilege the wealthy over the less wealthy when there’s no corresponding relationship with intelligence and drive. While I might come some of the way with you about creating an educational system that enables everyone to achieve their potential, I don’t see what the size of your parents’ bank account has to do with it.
My “smart or driven” daughter incidentally went to a comprehensive school that offers the International Baccalaureate rather than “A” levels. She scored 45 points – the maximum possible, equivalent to five A* “A” levels. Did she not “achieve what they could have achieved in the private or grammar school system”?
Dangerous things, generalisations.
However, my very active Labour MP (she campaigned against local hospital closures) phoned me and said Labour have no chance of winning so don't worry about tax policies and education policies, vote for me if you think I do a good job in Opposition of asking the government awkward questions and holding them accountable. So I did vote for my Labour candidate - because I wanted someone to hold the government accountable rather than giving them free rein.
Which is fine, but that’s a separate issue.
