Best of the Spectator Reality Check: 2025 – tears, tariffs & taxes
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Dec 28, 2025 
Rory Sutherland, a prominent behavioural scientist known for his insights into advertising and economics, and Arthur Laffer, the distinguished economist behind the Laffer curve, delve into the intricacies of taxation and its impact on growth. They discuss how high taxes can hinder prosperity, the nuances of taxing the wealthy, and the implications of recent budget strategies. Sutherland intriguingly advocates for a land value tax, while Laffer critiques Britain's tax burdens, making for a lively debate on economic reform and public sentiment.
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High Taxes Shrink Britain’s Prosperity
- Arthur B. Laffer argues Britain’s high tax burden is destroying prosperity and shrinking its global economic share.
- He urges a radical tax shakeup, citing cuts far below current top rates to revive growth.
Wealth Taxes Backfire On Share Of Tax Paid
- Protesters sought wealth taxes, but the top 1% already pay around a third of income tax.
- Michael Simmons notes increasing taxes on the wealthy have reduced their share of total tax due to behavioural responses.
Use Threshold Freezes Carefully
- Rachel Reeves used threshold freezes to raise revenues by dragging more workers into income tax.
- Expect threshold freezes to hit lower earners and expand the taxpayer base unless reversed.