On the right our economic policies are generally about wealth creation as opposed to wealth redistribution.
One of the issues with that at the moment is VAT, it bottle necks any newly created wealth filtering effectively to the population. Especially as the areas of the economy that make up the majority of the UK economy generally do not have large work forces e.g. financial services.
At 20% VAT for any wealth created 90% will be gone to the government after 10 exchanges.
This cripples all business and consumers, where trade is meant to be a fair exchange between two willing parties this means that someone needs to be having a more than even trade to work, this means that invariably anything that is bought is not worth what was paid for it by 20% less.
This creates poor incentives for consumers as well as industries.
VAT or a sales tax are not good.
A more protections version of this proposal would be VAT exemption for all British products. While keeping the 20% on anything that is imported.
