Capital Gains Tax Rise Incompetent

After having failed miserably in my attempt to remain neutral on the issue of CGT in yesterday’s blog covering a story that was pro the rise, I think I am on safer ground today. I want to talk about an article that has sentiments much closer to my own heart.

In the Scotsman late last week political commentator Alex Orr wrote a strong condemnation of plans to hike CGT up to frightening levels. He pulled no punches as he branded the move by the coalition incompetent. His reasoning was fairly straight forward. The hike will strangle the life out of the budding UK economic recovery. Rather than resulting in money pouring into the nation’s coffers to be paid off the deficit, the opposite is likely to be true. The move will slow the trickle of money to the government even further as everyone shuts up shop and battens down the hatches. Investment will all but grind to a halt.

He further goes on to say that the government should not feel compelled to make its own mistakes when it can study the result of this kind of move by looking at what happened in the USA and Australia when they tried this trick. A drastic drop in revenue for anyone who is curious. I am all for learning from the mistakes of others, it is far less painful.

I, not surprisingly agree wholeheartedly with Mr Orr. I hazard that most professional landlords do.