The cut in the top rate of income tax from 50% to 45% set up a tax avoidance opportunity. The numbers suggest plenty took advantage of it, David Smith reports
It is not often that you see the effects of tax changes quite so explicitly in the big figures for the public finances. Normally these things happen well below the waterline rarely breaking the surface. A big impact however is exactly what we have seen recently. Let me explain why.
In April to some people’s surprise public sector net borrowing was £11.5bn up on a year earlier when it was £9.5bn. That was disappointing breaking the pattern of monthly deficits being lower than their level a year earlier. It was a significant reversal.
It was particularly disappointing given...
