Each month, when it is time for the Bank of England to decide whether to change interest rates, many thousands of families suffer anxiety and stress while awaiting a decision.
Mostly, it seems the decision will be based on two main economic factors. First, the rising values of properties and, second, the rate of “high-street lending”.
In both cases, there are controls that the Chancellor could introduce to cure these damaging economic trends at a stroke.
Introducing property gains tax can control property prices. This would operate as capital gains tax does but without any allowance. The gain would be that in excess of inflation and could allow improvement costs to be deducted.
The rate of tax needs to be reasonably high to be effective, say, 40 per cent or 50 per cent. The money raised could help fund people without a home or those who cannot get on the homeowner ladder because they do not have a deposit.
As for high-street spending, I would bet that this increase in recent times is due to the increases in credit limits, whether the accountholder asked for it or not. Put a stop to this and at the same time increase the minimum payable each month and cardholders will restrict their spending.
I feel these two controls will effectively help the economy keep on an even keel but I am sure politicians will want to avoid such simple measures.