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article imageOp-Ed: Brexit — A revenue disaster for the UK?

By Paul Wallis     Oct 14, 2019 in World
London - As Brexit makes its necrophiliac way to “fulfillment” the political arguments have overshadowed a few issues, like revenue. What happens when you dislocate your revenue base to this extent? You’re about to find out.
Brexit has been festering in the headlines for 3 years as the process has basically done nothing. The endless Conservative political failures and bitching sessions have been piling up and nothing of any actual substance has been achieved. The deadline is October 31.
Revenue, revenue, revenue
A few questions need to be asked about future UK revenue at this point, and should have been asked before this absurdity went to a vote:
• What are the forward projections for revenue after Brexit? Are there any actual numbers, or would facts just get in the way?
• What sort of earnings are projected to deliver revenue from the income and business tax bases? Upending the entire business revenue of the UK may have some effect, perhaps?
• What replaces VAT? VAT is a type of consumer tax. Where does this money go, and where does a revenue stream come from, if consumer spending is hit by Brexit? (Post script: In the original draft, I called this an "EU tax", which is incorrect in context, whatever the revenue sharing issues with the EU. It's 20%, which represents a lot of money in revenue. If consumer and business spending is down enough, the revenue base will be severely eroded.)
• What if Scotland leaves? How Scotland leaving the UK may affect revenue is perhaps less interesting than whether the UK will continue to exist, but it’s big money, and will have an impact on revenue.
The basics have been ignored
The entire Brexit process seems to have been predicated on what could charitably be called narrow interests. Leading Brexiteers are short-selling the pound, for example. Dodging the new EU tax laws also seems to be a factor in this particularly myopic move. Reality, particularly economic reality, hasn't been much of an issue.
Whether tax-hating rich people need more money or not, the UK revenue system could be in serious trouble if the money isn't there. Austerity, that never to be sufficiently damned excuse for short selling public services with public money, won’t work this time. If the economy crashes, the revenue simply won’t exist.
Interesting to note, even the subject of future revenue doesn’t seem to have ever been mentioned at all. It’s never been raised in Parliament, either, to my knowledge. Apparently everyone believes this “momentous” decision will result in business as usual, and it simply can’t.
… What else?
If such basic considerations as food, medicine and revenue weren’t part of the thinking on Brexit, what else is likely to have been ignored?
Let’s get this straight – The UK can’t run on serious revenue shortfalls for long.
If the loss of revenue is big enough, the nation will inevitably have to borrow a significant amount of money. That’s not the best scenario for a very nebulous, not to say unbelievably vague, economic situation.
Ironically revenue shortfalls and debt are likely to result in a re-introduction of super tax and measures used to pay for the World Wars. The tax burden can only fall on the rich, who seem to be the only people with money.
The irony of it - Brexit will produce a massive tax bill if revenue isn’t properly under control. It may be that the Conservatives have not only found a way to bury Britain, but themselves as well.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
More about Brexit, UK revenue, Scotland leaves UK sceenario, UK super tax
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