The National Institute of Economic and Social Research has called for the Chancellor to spend an extra £50bn a year on public investment
The National Institute of Economic and Social Research has called for the Chancellor to spend an extra £50bn a year on public investment
NIESR deputy director Stephen Millard insisted that putting more tax on capital would be a mistake. He said: “Of the taxes that are out there at the minute, you want to increase income tax. It is the least distortionary, it doesn’t affect the long run. What you absolutely don’t want to do, actually, is increase capital taxes. So I would very much argue against that.”
The think-tank is calling for Ms Reeves to increase Government investment to 5 per cent of GDP, around twice its current level, at an estimated cost of £50bn each year. The report calls for the Government to exclude capital investment from its borrowing rules entirely but also says that higher taxes are inevitable because the national debt is already so large and public services need more cash.
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