Tom Clougherty

"Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it." – Ronald Reagan

This is a brilliant idea: Use value uplift from new homes around stations to connect suburban train lines with new crossrails. Dramatically increase network capacity without general taxpayer subsidy. Why wouldn't government leap at this opportunity? bensouthwood.co.uk/p/the-governme…

More here: thetimes.com/money/tax/arti… (9/9)

That would boost growth and create much healthier political dynamics around the tax burden. Once everyone sees that higher spending means their tax rate rises (and vice versa) we can have a proper debate about what we expect the state to provide. (8/9)

Here I am in The Times, full of seasonal good cheer. Are we doomed to never-ending tax increases? (1/9)

This report looks superb. The government will be desperate for a good news story on Wednesday... Why not announce that this will be implemented in full at the Budget?

🚨2025 Budget Briefing: The Fiscal Context 🚨 ✍️ @TomClougherty

We think of the British state as a juggernaut. But in many ways, it's often terrifyingly ramshackle - and as I say in @thetimes today, the govt's new announcements on business regulation are the perfect case in point. Nerdy but important thread. (1/?)

Lots of people are saying that abolishing stamp duty is pointless because it will just push up property prices by an equal and opposite amount. This is unlikely to be the case. The economic incidence of SDLT isn’t 100% on the buyer. Because the supply of housing is so fixed (‘inelastic’), sellers bear more of the burden. Some estimates suggest a 60:40 split, with sellers bearing 60% via a lower sale price. Let’s apply that to the sale of a property with a ‘true’ market value of £500,000 and SDLT of £12,500. The seller’s burden is £7,500, and the buyer’s is £5,000. The sale price is depressed by £7,500 to £492,500. The buyer pays that + the SDLT = £505,000. Compared to a tax-free world, the seller gets a lower price (-£7.5k), and the buyer pays more overall (+£5k). Both lose out to the taxman. Abolish the tax, and the £12,500 wedge vanishes. The sale price rises to the ‘true’ market value of £500k. The seller gains £7.5k (vs the old price) and the buyer saves £5k (vs their old total cost). The surplus previously taken by the tax is now split between them. This is the key economic point. SDLT’s tax wedge destroys mutually beneficial deals, creating ‘deadweight loss’. Abolishing it makes the market more liquid, improving labour mobility and helping people ‘right-size’ their homes as their lives change. Eliminating SDLT is obviously not a panacea. But the claim ‘prices just go up’ is a misunderstanding. It mistakes the mechanism (a higher headline price) for the outcome (a net gain for both buyer and seller and a more efficient market).

📸 Some snaps from #CPC25

This means that stamp duty is many times more damaging, as a source of revenue, than broad-based taxes on income and consumption. Any proposal to permanently cut or abolish it is therefore extremely welcome.

Indeed, research suggests that the wider social and economic harms are equivalent to three-quarters of the revenue raised – and that's on top of the loss to the people actually paying the tax...

Abolishing stamp duty is the single best reform any government could make to Britain's tax system. As things stand, this outdated and uneconomic levy is wreaking havoc on our already troubled housing market – by deterring sales and depressing house-building...

🇦🇷Looking forward to hosting this @CapX panel at 5pm today at #CPC25 to discuss the great chainsaw-wielding Argentine Javier Milei Joining me on the panel are: @jackmrankin @zatzi @TomClougherty @tomhfh Tune in using the link below👇 youtube.com/watch?v=LoMkag…