Government needs to show commitment to address tax imbalances
This week, there has been speculation and reports that the Government’s Tax Working Group is delaying any recommendation of a Capital Gains Tax in their first report. The Government and the Tax Working Group need to reaffirm, that despite these reports, they are committed to implementing measures to address tax imbalances which hold back investment in our productive economy.
“Although we do not yet have the first report from the Tax Working Group, it is disappointing to hear reports that they may hold off on any Capital Gains Tax recommendations. The Working Group need to propose, and the Government needs to implement an effective policy set which can address the current tax imbalances which favour assets, largely existing residential housing, over investment in our productive businesses.” Said Dr Dieter Adam, Chief Executive of The Manufacturers’ Network.
“While we cannot judge the outcome until we receive the Tax Working Group’s report, this appears to be a sign that the Labour-led Government is shying away from making what all but the most entrenched lobby groups acknowledge are tax changes that will bring us into line with international best practice and help to direct more capital resources away from the speculative and into the productive part of our economy. We’re still hopeful to see some more detail and clarification soon that the group will propose effective measures to address current imbalances in our tax regime.
“The second bit of disappointing news this week is that the Government has failed to listen to the many voices from our members, and many others in the business community, asking for a reconsideration of the proposed changes to employment law. We are afraid that key voices in the Labour Party in particular fail to understand that significant rises in the cost of labour, combined with operational constraints such set meal breaks, will inevitably put pressure on manufacturers to further reduce the role of labour in their processes in order to remain globally competitive. “Says Dr Adam.