Tag Archives: Public Sector

Thatchers Taxes

Today, the funeral of Margaret Thatcher was held in London and happily, it passed peacefully despite protests that were organised to reflect the negative opinions held by some. Despite the fact that I was barely concious of what was going on around me by the time she left office, history and subsequent events tell me that it’s hard not to sympathise with those that hold these views. It’s also hard not to feel uncomfortable at the evident glee some have expressed to reflect the death of an 87-year old woman.

A particular source of contention has been the cost of the pseudo-state funeral that was organised for her – estimates for the total cost have reached £10million of public money. Averaged out over the 29.7million working people in the UK (http://www.ons.gov.uk/ons/rel/lms/labour-market-statistics/april-2013/statistical-bulletin.html), that’s 33.6 pence each.

It’s fair to say that no one likes paying taxes, but being forced to pay even the smallest portion of my earnings towards a funeral that many disagree with is distinctly off-putting. As a side note, you suspect that the private-sector centric Thatcher wouldn’t have sanctioned this publically-funded extravagance for most predecessors, making the decision even more inappropriate.

A lot has been made this week of a correlation between this £10m funeral and £11m of cuts to national arts funding, announced near-simultaneously. Given the choice, I would personally have directed my 33.6p towards a national academic research pot, but the distinction is immaterial.  As we live in a world where death and taxes are the only certainties, the fact that the only influence we have regarding where they go is a single vote every 4 years. And more often than not, even that feels absolutely irrelevant, which further increases the sense of distance between the number leaving your paycheck and the services that exist as a direct result.

I’m not sure to what degree this can be implemented, but there has to be a positive aspect to actually allowing people to vote with their money on a annual basis? Experiments have proven that overall support for a given tax change is significantly higher if the rise has been specifically earmarked for favourable causes (http://ideas.repec.org/a/eee/ecolec/v70y2011i11p2181-2190.html) and arguably, this could translate to an overall increase in tax revenue by reducing the incentive to evade taxation. Take 5% of your obligatory tax contribution and let you choose a charitable cause or marginal public sector to channel it towards and perhaps the ingrained hatred for taxation might drift away?

Or, if you particularly want to, feel free to build up a funeral fund for your favourite polarising politician?