Friday, August 21, 2009
The first pieces of the inflation puzzle are exposed
"The recession and rising unemployment cut the corporate tax take by 38 per cent and income from income tax and capital gains tax dropped by 14 per cent. Public spending on benefits rose 10 per cent in July compared with July last year." ... => Therefore companies have cut their profit margins, and at the first sign of any recovery, they need to be reinstated, this will also increase tax revenue, so don't expect any help from Government. Plus of course the minimum 2.5% raise in VAT. (Any bets about a further temporary 2.5% raise in March 2010 ... always a possibility).