Letters

摘要

I agree that deducting tax for mortgage interest is a misguided policy ("The great distortion" and "A senseless subsidy", May 16th 2015). But your call to limit the tax deductions on interest expenses incurred by businesses as well is absurd. If a company didn't reduce its taxable income for expenses, including interest paid to lenders, income would be taxed twice. The irony is that corporate profits are often taxed twice under our current system: at the corporate level and then when realised by shareholders. Governments may reduce associated tax rates as a fudge, but it remains an unnecessary complication. You should have argued, as you have in the past, to eliminate corporation tax and for tax rates on dividends and capital gains to be set at the same levels as regular income.