One of the proposals from a few of the leadership candidates earlier this month was to set the UK corporate income tax rate at 15% (it's currently 19% and set to rise to 25% in 2023).
I just tried running this through OG-UK and got the following result (percent formatted).
| Variable |
2022 |
2023 |
2024 |
2025 |
2026 |
2027 |
2028 |
2029 |
2030 |
2031 |
2022-2031 |
SS |
| GDP ($Y_t$) |
+0.07% |
+0.13% |
+0.15% |
+0.16% |
+0.20% |
+0.12% |
+0.11% |
+0.09% |
+0.08% |
+0.07% |
+0.12% |
+0.27% |
| Consumption ($C_t$) |
-0.04% |
-0.92% |
-0.20% |
-0.02% |
+0.06% |
+0.13% |
+0.16% |
+0.17% |
+0.18% |
+0.19% |
-0.03% |
+0.47% |
| Capital Stock ($K_t$) |
+0.09% |
+0.25% |
+0.46% |
+0.49% |
+0.53% |
+0.55% |
+0.54% |
+0.53% |
+0.51% |
+0.49% |
+0.44% |
+1.20% |
| Labor ($L_t$) |
+0.05% |
+0.07% |
-0.01% |
-0.01% |
+0.02% |
-0.12% |
-0.13% |
-0.14% |
-0.15% |
-0.16% |
-0.06% |
-0.23% |
| Real interest rate ($r_t$) |
+0.98% |
+2.37% |
+1.98% |
+1.93% |
+1.92% |
+1.72% |
+1.70% |
+1.70% |
+1.71% |
+1.72% |
+1.77% |
+0.76% |
| Wage rate |
+0.01% |
+0.06% |
+0.16% |
+0.18% |
+0.18% |
+0.23% |
+0.24% |
+0.24% |
+0.23% |
+0.23% |
+0.18% |
+0.50% |
For a ten-point rate cut, these results seem small. I'm definitely reading them right as already percentages right? It could also be the fact that we're still using the linear tax fit.
cc @jdebacker @rickecon @MaxGhenis
One of the proposals from a few of the leadership candidates earlier this month was to set the UK corporate income tax rate at 15% (it's currently 19% and set to rise to 25% in 2023).
I just tried running this through OG-UK and got the following result (percent formatted).
For a ten-point rate cut, these results seem small. I'm definitely reading them right as already percentages right? It could also be the fact that we're still using the linear tax fit.
cc @jdebacker @rickecon @MaxGhenis