LEVELLING UP
While rebalancing spending on the things that do the most for growth to help neglected places is very welcome, using the tax system is potentially a good way to complement things like new infrastructure investments, and tax changes can potentially have faster effects.
Robert Largan MP, MP for High Peak
This report reveals that many taxes are regionally regressive, in that they are borne disproportionately by the less affluent regions. These include taxes such as council tax, some green levies, tobacco and alcohol duty, and VAT. In particular:
The report also models different tax changes to understand which regions would benefit most from different approaches. The analysis finds that:
The paper argues that the Treasury should publish regional distributional analysis at every Budget and Spending Review so that policymakers can systematically examine the regional impacts of different tax changes and to ensure that the levelling up agenda is not held back by the tax system.
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