Do taxes really fund public services?

SueDoku

I read this the other day - and now I'm more confused than ever ..!
voxpoliticalonline.com/2024/03/19/isnt-martin-lewis-wrong-about-the-purpose-of-tax/

Labour also plan a value for money office before contracts are agreed so no more huge payments to private companies who then go on to donate to the Tories. I suspect long term better value will be had from directly provided services. At first though Labour will have to let some contracts run their time, I suspect this is what the gov't are doing now, setting up lots of contracts

www.channel4.com/news/rachel-reeves-on-labours-plan-for-an-office-for-value-for-money

Always remember that those who have never been in Government have no idea how hard the spending choices are. And it IS all about choices. And even those who have been inside the tent (Liz Truss) can get it spectacularly wrong. The economy is a sensitive thing. The mix of taxes & borrowing needs careful management but I do wish politicians would stop pretending that massive lowering of taxes will somehow deliver a miracle to the economy. It won’t(IMHO)

👍Agree, common sense.

A magic money tree...🤣

MaizieD

SueDoku

I read this the other day - and now I'm more confused than ever ..!
voxpoliticalonline.com/2024/03/19/isnt-martin-lewis-wrong-about-the-purpose-of-tax/

It's not saying anything essentially different from what I keep on explaining.

There are only two takes on this, either 1) you believe (as most people do, and those in control of 'the money' are happy for you believe) that taxation funds spending, or you 2) are convinced by research evidence that state spending comes before taxation and isn't dependent on it.

So what is confusing you?

Maizie

You are technically correct, spending comes first, then taxation repays part of that spending, the shortfall is made up with borrowing/creating money. It is the amount of borrowing that has to be made to provide the services we “want” that is important and the Sunak government is determined to borrow less.
We can argue all day what a new government might change, my guess is that borrowing will increase modestly and taxation will increase to pay for it