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Free money for everyone! The helicopter boost our economy needs

  • United Kingdom
  • Real estate

17-08-2020

Paul Beausang, Head of Real Estate Tax and Bruce Dear, Head of London Real Estate propose “Bounce-Back Bonds” and reinvigorating the nation’s national sport.

More than almost any other developed economy, Britain is powered by consumer spending. Napoleon called us a nation of shopkeepers. He was wrong — we’re a nation of shoppers. Covid-19 has sapped our confidence to play our real national sport: round the clock retail. Our economy’s shopping addiction is an obvious weakness, but it is also an immediate opportunity.

If we can get the great British consumer spending in big numbers right now, we could avoid the worst of the looming recession. Reducing VAT or income tax won’t be enough. Alistair Darling’s VAT cut during the financial crisis showed that in a time of unemployment and uncertainty, people avoid spending and prioritise saving.

That’s why it’s time for “Boris Bounce-Back Bonds”. Every tax-paying adult should be sent a £300 free-gift income tax rebate locked into a Bounce-Back card. These cards would refresh the consumers that tax cuts cannot reach, because they will be issued on a spend now or regret later basis. Every £300 individual stimulus card would come with the condition that it must be spent (at a safe social distance) in non-essential shops, restaurants, hotels or bars before 1 October 2020. If not, it will be lost — like the bubbles in that beer you didn’t buy.

Bounce-Back Bonds would hit multiple targets simultaneously. They would boost consumer confidence vividly and innovatively, incentivising millions of consumers to get to the shops now. People using them would also spend other money, galvanising widespread economic activity.

Perhaps most importantly, they would lift public morale, and cheer people up, and start positive conversations with the opening: “What did you spend yours on?”

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