Tuesday 10 April 2007

Affordable freedom + Attractive tax rates

Two more excellent letters in the Western Mail today:

Affordable freedom

SIR - In his attack on Plaid AM Dai Lloyd, Martyn Williams (Letters, April 3) questions how a future Plaid government would "squeeze £11bn [the size of the Assembly's current block grant from Westminster] out of a Welsh population of three million people".

Using the writer's own figures, there are almost two million Welsh residents of working age, ie actual or potential income-taxpayers, and £11bn divided by two million is £5,500. A lot of money? Well, divide into twelve monthly instalments and you now have around £460 per month. Readers might like to check their latest payslips for tax deductions. You could earn around £30,000 gross a year and pay this in income tax. Many of us in steady employment would be fairly pleased to find that we could get decent public services in Wales at this level of direct tax contribution. Then, of course, we have NI, VAT and the numerous other duties on consumables.

I'm very grateful to Mr Williams for reminding me how affordable independence actually could be, and for making me ask yet again: "What on earth is Westminster doing with all our money?"

Ian Hughes
Morganstown, Cardiff

Attractive tax rates

AS Merfyn Thomas says in his letter (April 7) Wales would be a self-supporting country if independent.

He makes many valid points but may I add another very important point. Currently companies operating in Wales pay corporation tax to the London Exchequer. When Wales is independent they will pay this tax to a Welsh Exchequer, and if this independent Wales cut corporation taxes, as small, quicker, acting-on-their-feet countries do, these companies would expand here whenever they could plus more new companies would be encouraged to relocate here.

Lower ongoing tax rates, plus attractive capital tax allowances attract business more than one-off grants, ask any genuine business person. Plus, of course, our extremely important indigenous businesses would benefit and they are often the backbone of rural economies. Locally, where I live, we have two major oil refineries. Does Wales benefit from their profitable business? The answer is a huge no as far as corporation tax is concerned. Soon there will be major LNG developments here also. Again will Wales receive corporation tax benefits? No, they will flow to London.

And might I leave readers with a final thought.

How does the Isle of Man and the Channel Islands manage without the support of the London government? The answer, although they are smaller than Wales, is very nicely thank you.

Neyland, Pembrokeshire

1 comment:

Korakious said...

May I say that while "lower taxes" and capital attractive policies may be good for Wales as an abstract concept, they will most definitely be to the detriment of the Welsh people.