LETTER : High tax means low growth

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POLLY Toynbee takes the naive view that increased social security expenditure is desirable and should be financed by increases in taxation ("A little honesty from Labour...", 7 January).

Since 1979 the basic rate of income tax has been reduced from 33 per cent to 24 per cent and the top rate from 83 per cent to 40 per cent. Over the same period expenditure on the NHS has increased by 70 per cent in real terms, education by 50 per cent and the social security budget by 75 per cent.

Nevertheless, Ms Toynbee asserts that taxpayers should dedicate a larger share of their in- come to the DSS budget whilefailing to highlight that it already costs the average taxpayer pounds 15 every working day to finance.

The Government has encouraged private pension insurance because of demographic changes. In 1991 there were 3.3 workers per pensioner; by 2030 there will be only 2.2.

Ms Toynbee's options, far from creating "an honesty which would save the welfare state", would be more likely to end it. Higher taxation would stifle economic growth and create an unsustainable level of welfare expenditure which would eventually have to be cut.

George Crivelli

Kidderminster Hereford and Worcester

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