shouldn't be used to take money from the rich to subsidise the poor: "the problem with socialism is that you eventually run out of money" = lack of incentive to work + dependency
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AIMS
promote more investment, growth and gov income through tax cuts
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1980 and 1988 BUDGET
top rate of income tax cut from 83% to 60% // basic rate of income tax from 29% to 25%, HIGHER RATE CUT TO 40% = "the giveaway budget"
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CUTS SUBSIDISED BY:
discovery of North Sea oil BUT avg tax bill rose by 6% 1979-90 due to increase in indirect taxation -- VAT + 8%-15%
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SUCCESS
it was a stimulas which hlped +disposable income = rise in consumer spending and eco growth // Decline in tax avoidance: wealthiest 5% paid as much tax in 1988 as they did in 1978 (40% rate vs 83%) // contributed to Lawson Boom 4/5%+late80s
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FAILURES
+regressive taxes e.g. VAT and Nat Insurance Payments -a higher burden on the poor (wealth inequality) // Poll Tax brought down Thatcher
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Other cards in this set
Card 2
Front
AIMS
Back
promote more investment, growth and gov income through tax cuts
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