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Monday, August 15, 2005
The march of the flat tax

Politics is nearly always quiet in August as politicians go on holiday but the relentless spread of the flat tax continues.

- The Telegraph (p.32) reports today that Greece may become the next European nation to introduce a flat rate of income tax. The rate would be 25 per cent for personal and corporate income, with a tax-free personal allowance of 13,000 euros.

- The Wall Street Journal Europe (p.6) runs an article by Steve Forbes, Editor-in-Chief of Forbes Magazine and president and CEO of Forbes Inc, which advocates a US flat tax. "A flat tax would unleash a stupendous economic boom. ... How ironic that one-time Communist nations have been reaping the benefits of a flat tax before that bastion of free enterprise, the US."

- A leader in Saturday's Guardian (p.21) argued that a flat tax would not be suitable under Britain's mature tax and welfare system, but concluded: "Yet as with some once-controversial big ideas of the past - such as central bank independence - it would be a mistake to dismiss flat taxes too lightly."

- And The Business (p.2) reports that Howard Stott, a fellow of the Institute of Taxation, has authored a new proposal in which 10 per cent flat rate of tax would be applicable to all income and profits, allowing nearly all tax reliefs to be abolished.

The march of the flat tax continues, despite the summer break.