Once again, the Conservatives are being pressed by the media and Labour to give a commitment to tax cuts - I wholly support David Cameron's and George Osbourne's response to the Tax Reform Commission's recently published report - economic stability comes before tax cuts.
This does not mean that the Conservatives have abandoned any core principle: we still believe that low tax economies are the strongest economies, and we believe that economic growth can be shared between increased spending and tax cuts.
Some people ask, How can you increase spending and cuts taxes at the same time? Simple, for example, a 4% economic growth could mean half of that growth going on extra spending and the other half on reducing the tax burden.
A high tax burden, especially for businesses, can stifle economic growth by reducing economic competitiveness, and that is why George Osbourne is right to focus on simpler and fairer taxes for businesses.
George Osbourne's response to the Tax Reform Commission's report is:
“The Commission have given us a menu of options that merit serious consideration. Some we will accept, some we will modify and others we may reject. But the framework of our tax policy is now set. Sound Money means that stability will always come first before promises of tax cuts. We will not be promising up front, unfunded tax reductions at the next election. We will, however, rebalance our tax system. Green taxes on pollution will rise to pay for reductions in family taxes. This Report sets out some options for doing that. And we will also embark on a major simplification of business taxes that will pay for a significant reduction in our business tax rates. This report represents a major step in that direction. The battle for a simpler, fairer and more competitive tax system has begun.”
Sounds straightforward to me!!!!