Teaching Comparative Government and Politics

Thursday, April 02, 2015

Taxes? Which taxes?

In the USA, advocates of consumption (rather than income) taxes and flat (rather than progressive) taxes look to some form of value added tax (VAT). In most European countries, a VAT is a major source of government funding. Hence, the arguments in the current campaign in the UK.

(Students should keep in mind that there won't be multiple choice questions on the AP exam specifically about this campaign or election, but you might be able to use examples of campaigning or the election when writing answers to free response questions -- the exam is scheduled a week after the election.)

General election 2015: Labour to pledge not to increase VAT

Labour's general election manifesto will contain a pledge not to raise VAT, shadow chancellor Ed Balls has said.

The party will make a "clear pledge" not to increase the tax, which it says "hits pensioners and the poorest hardest", if it wins the election.

Labour has repeatedly claimed the Conservatives would have to increase VAT due to the scale of spending cuts planned for after the general election…

VAT, which is levied on most business transactions and many goods and services, was increased from 17.5% to 20% in Chancellor George Osborne's first Budget in 2010.

[The shadow chancellor added] "So, today, I can announce a clear pledge to the British people. The next Labour government will not raise VAT. And we will not extend it to food, children's clothes, books, newspapers and public transport fares.

"We will not raise VAT because it's the tax that hits everyone. It's the tax that hits you every day. And it hits pensioners and the poorest hardest."…