SIR – I’d agree with Peter Nielsen (April 4) that attempting to tax bankers’ bonuses would be a futile method by which to increase tax revenue.
However, his ‘progressive’ tax system would be expecting a better result from a system proven to be a failure. There is no evidence that the 50 per cent tax increased tax revenue.
By simplifying the tax code (currently longer than War and Peace and full of loopholes which encourage tax avoidance) tax revenue could be increased.
Raising the tax-free allowance up to £13,000 would mean very low paid workers, including those working on the minimum wage, would be taken out of tax altogether.It would also be a significant move forward to make work really pay. The threshold would be higher for pensioners at £15,000.
Above this threshold, a flat rate of tax at 25 per cent, inclusive of National Insurance, would ensure that people would be motivated to work hard. Progressive tax systems can discourage effort.
Lower, flatter taxes have been proven in many of the Pacific Rim countries to increase the overall tax take.
The burden of taxation could therefore be alleviated on the working and middle classes, with no deleterious effect on the Exchequer.
JAMES GOAD
UKIP candidate Gorse Hill and Warndon
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