You can watch the full event above, or download the slides by clicking here.
The parts of the UK tax system that dictate how different forms of income are taxed are of central importance and are not fit for purpose. There is a large, unjustified and problematic bias against employment and labour incomes and in favour of business ownership and capital incomes. The tax treatment of returns to investment is a mess, with incentives ranging from large subsidies to large penalties. This is not a niche problem: about 1 in 5 of the UK’s workforce are either self-employed or working through their own company. Reforming this area of tax would make the system fairer and allow us to raise revenue with less economic harm. This should be particularly important in the wake of the COVID-19 crisis.
At this event we discussed findings from a new report, funded by the Nuffield Foundation, which sets out the problems with the current tax treatment of business owners’ incomes and investment and discusses how the government could take practical steps towards fixing them.
The event was chaired by IFS Director Paul Johnson and there were presentations from:
- Helen Miller, Deputy Director, IFS
- Stuart Adam, Senior Research Economist, IFS