Salvation now...pain later?

As we await the Autumn Statement, speculation is rife as to the ways in which the planned spending increases and tax cuts will have to be paid for in the future. The BBC reports that the top rate of tax will be increased from 40p to 45p in the pound after the next election for those earning over £150,000 per year. This appears to be a reverse in Labour's policy, reierated in their 2005 General Election manifesto, not to increase the top rate of tax. Also, it highlights differences that are starting to emerge between Labour and the Conservatives over future tax and spending policy; the Conservatives have said they would pay for any increase in government borrowing by scrapping planned rises in expenditure. (Link to BBC for details) and (FT)

The FT has produced a 'checklist' for the Autumn Statement, detailing certain aspects of the economy. (Link)

Punch hits out at 'tax on binge drinking'

An interesting article in today's Guardian questioning the effeciveness of alcohol taxes in reducing binge drinking. The chief executive of Britain's biggest pub company has attacked the recent above-inflation rise in alcohol duty, dismissing government claims that it could discourage binge drinking as "ridiculous". Giles Thorley, chief executive of Punch Taverns, warned today that the 6% rise in alcohol duty, announced in the March Budget, could even encourage excessive drinking because customers may choose to buy more cheaper alcohol from supermarkets and drink heavily at home."The pub is the home of responsible drinking. The number of restrictions that already exist as result of recent government legislation means that you are much safer drinking in the pub than anywhere else," he said.

http://www.guardian.co.uk/business/2008/apr/24/punchtaverns.fooddrinks

Think about the conditions that ensure that a tax that aims to reduce consumption is successful. Why doesn't Thorley think it will be successful?