So now we have the Labour manifesto. Since no Brexiteer or apologist for Brexit is going to point out its obvious threats to our prosperity for fear of also drawing attention to the obvious perils of leaving the EU, I will.
The economy is dominated by the financial services sector and global natural resources and pharmaceuticals companies.
Particularly in financial services, which operates in a global business matrix rather than just headquartering various autonomous businesses around the world, there's a clear danger of relocation to New York, Frankfurt or Hong Kong if Brexit isolates the City from the rest of the world.
However, all large companies pay most of their tax in the countries in which they are listed and their headquarters are always inhabited by most of their highest paid individuals so there's not a lot to keep them in London apart from a benign tax regime.
So the Labour Party thinks that in a Parliament spanning Brexit, it's a good idea to:
1) Raise Corporation Tax, which at present is low and a good reason to stay in the UK.
2) Increase the Income Tax on high (i.e. > £80k and higher earners (at > £123k). In practice, once taxable non salary benefits are included, these are middle managers in most large companies, not City fat cats and there are lot of them, so the cost to business will be high.
3) Introduce a separate levy on companies in respect of high salaries, 2.5% over £330k and 5% over £500k. Here they are at least starting to impinge on PLC directors but also on many senior managers.
4) Unbelievably, to UNILATERALLY introduce a levy on derivative trading, a cornerstone of many City businesses. This is preposterous. Such a levy could be a good idea to damp down unfettered speculation in financial markets but only if applied simultaneously on all major financial centres across the world. To do it unilaterally on top of the other measures would more or less guarantee financial services companies departing from the City post Brexit.
If the levy applies to all derivatives, it will hit genuine businesses as well as speculation. For example, airlines buy fuel on the futures market which helps them mitigate spikes in oil prices. Holiday companies buy foreign currency futures which isolate them, and you, from changes in the value of the pound. Consumers will end up paying if that mechanisms are closed off. Incidentally, I read that one of the reason the MOD once again has a huge hole in its budget is that it DIDN'T hedge future purchases of aircraft in US dollars from Lockheed Martin and Boeing against falls in the value of sterling. Perhaps that signifies the Government doesn't understand what these things do....
Let's hope Corbyn is as unelectable as he looks.