Dearer and Dearer Money
Sta,—As one who bears some responsibility for the memorandum recently submitted to the Chancellor by the Wider Share Ownership Council, I hope Mr Nicholas Davenport is right in suggesting that it is better to attract savings by tax reliefs than by offering higher rates of interest. We must, however, face the fact that tax reliefs are not attractive to the con- siderable body of potential savers who pay little or no tax:This is. of course, just the sort of problem which might be elucidated by the Royal Commission on savings proposed by Mr Ian Fairburn; and problems of this kind will be much better elucidated by such a body than by the Government which Mr Davenport feels sure is not neglecting them. Earlier in his interesting article Mr Davenport opines that the Government, not wanting to lessen incentives, will eschew higher direct taxation. Once again I hope he is right. But a little further on he appears to come to a somewhat different conclusion, that Mr Callaghan may, in fact, be tempted to increase the income tax and surtax payable by my friend Mr Oliver Stutchbury (at the risk, perhaps, of driving Mr Stutchbury to the Channel Islands, the Bahamas or some other place where the distinguished unit trust managers may be permitted to flourish).
One can only hope that Mr Davenport does not imply—nor Mr Callaghan intend—that higher taxes should be imposed discriminately on those who work in the City and/or offer competition to the National Savings Movement.
E. W. I. PALAMOUNTAIN
Wider Share Ownership Council, 4 Angel Court, London, EC2
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