Robin Hood economics ends in poverty

By Sir John Redwood on June 29, 2025

Of course most of the tax revenue needed has to be paid by the rich and the better off. The art of taxation is to set rates that maximise revenue without killing enterprise and forcing out the wealthy.

You do not make the poor rich by making the rich poor. If you try to tax the rich too much you drive them abroad. They do not have to stay to pay. They do not have to pay to play here when there are plenty of lower taxed places to go. They also have the option of paying more to hire better defences against a predatory state.

The current Chancellor inherited taxes that were already high as a result of the over spending and fall in tax revenues brought on by the covid lockdowns. She was warned upping the rates would be damaging. She ignored the advice and now watches in horror as the billionaires and the millionaires flee the country in increasing numbers.

The Office of Budget Responsibility is poor at forecasting revenues. It often underestimates the negative effects of high rates on revenues and exaggerates the revenue likely to accrue from higher rates. Even the OBR will have to tell the Chancellor before her next budget the bad news that higher wealth taxes have driven away too many better off people, and higher National Insurance has destroyed jobs and business profits. As a result higher NI has reduced income and business tax revenue.

If the Chancellor wants to raise more revenue she needs to do a U turn on her tax rises last time. She needs to ask herself why Ireland has been raising four times as much business tax per head as the UK with a much lower rate.

One year on. A lot gone wrong.

By johnredwood on June 30, 2025

Unemployment up

Inflation up

Dear energy got even dearer

New UK oil and gas stopped for the year

Ban on new petrol cars brought forward to close UK factories sooner

National Insurance hiked for self employed and employees, hitting jobs

More tax on the rich led to many more leaving the country with loss of tax revenues

Disabled threatened with benefit loss, then a partial U turn

Refusal to enquire into rape gangs delays getting to truth

Gave away Chagos needlessly

Committed to paying Mauritius for 100 years

Gave in to EU demands with no legal agreement to any improvements for UK

No growth in their first six months thanks to run up to budget and budget tax rises. Further fall last month after some Q1 growth

Claimed they inherited too much spending and borrowing, only to make very large increases in both