With all the controversy over the Chancellor’s Budget in recent days, there are still those who challenge the direction in which he is leading the nation. One of his top adversaries is Ed Balls, Shadow Chancellor, who believes his party would reverse the 50p rate for top earners in the UK.
In an interview given to The Telegraph Mr. Balls went so far as to call the Chancellor’s budget a reverse Robin Hood approach. Whilst other critics are saying that the Chancellor reversed his big business approach in favour of households in the UK, Mr. Balls feels that the Chancellor is weighing in heavily on the side of only the top earners.
On the flipside, Chancellor Osborne believes that the 50p rate has done next to nothing for the British economy because top earners always seem to find a way to avoid paying that high of a tax. His contention is that lowering the rate will entice those top earners to pay their fair share. Unfortunately, Mr. Balls believes that a reduction of 5p will do nothing to bring those investing offshore rushing back to the UK.
The change is set to take place next year but has already begun a huge debate in the Commons where Mr. Balls was challenged as to whether or not this decision would be reversed by his party. Although he could not promise that, the Shadow Chancellor did say that this was not the direction which should be taken when working towards boosting the economy.
However, there are those who feel that lowering the tax rate paid by top earners is fair if they can be enticed to stop looking for loopholes to help them avoid paying their fair share. Since the changes will not take place until next year, it is yet unclear whether this reduction will indeed have the desired effect.
