British Plan to Raise Taxes and Debt Sets Off Political Sparring

Kelsey Walker
April 24, 2009
4:27 PM
Currently the worst recession within Industrial Nations is occurring within Britain. The Prime Minister laid out a plan for more than $1 trillion in deficit spending over the next five years, a scale of public debt that critics say is without precedent in Britain, and ordered a 5-percentage-point increase, to 50 percent, in the top marginal rate of income tax for the country’s highest earners. Some say this is good, some say this will worsen the economic downturn upon Britain. My Darling, the chancellor of the Exchequer predicts that the economy will shrink by 3.5 percent. The International Monetary Fund predicts that Britain’s economical recession will continue into 2010 but, But the British finance minister acknowledged that the government was not expecting the years of deficit spending to end before 2018. Some have warned that if the recession is longer and deeper than the government is predicting, the level of debt could lead to Britain’s facing a run on the pound and the possibility of having to turn to the monetary fund for emergency loans, a contingency last resorted to by a Labor government in the 1970s. The government has suspected to raise the taxes 50 percent on all that earn more than £150,000 a year, about $216,750. This will be the highest tax raise within the developing countries.
I don’t think that Britian is taking the right steps with the deficit spend however I do believe that the 50 percent tax raise on those that are uber wealthy.
http://www.nytimes.com/2009/04/23/world/europe/23britain.html?_r=1&ref=world