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IEA - Keir Starmer right to warn against hikes to council tax – but what taxes would he increase instead?

Julian Jessop, Economics Fellow at free market think tank the Institute of Economic Affairs, responded to Sir Keir Starmer’s speech on the economy

“Mr Starmer is clearly right that now is a particularly bad time to be raising any form of tax, including council tax. However, the money to fund local services, and especially to meet the increasing demand for social care, still has to come from somewhere. Council tax at least has the advantage of being a local tax, determined and largely spent locally. What other taxes would he increase instead – or would he simply borrow even more?

“It was refreshing to see more recognition of the positive role that private businesses have played during this pandemic, from keeping shelves stacked to creating the vaccine.

“However, it is not obvious what would be achieved by creating ‘legal, enforceable and immediate rights for working parents to request paid flexible furlough’. People can already ask their employers for whatever they want, and firms would still be able to refuse if they have a good reason. The additional bureaucracy could simply deter some businesses from taking on working parents in the first place.”

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