Always interesting to hear you posts. At the risk of thread drift, as this is applicable to all government spending on defence hardware, your thoughts on a generic question would be valued.
If the government were to say spend £1Bn on a defence contract for some new hardware (say some new SAR helos) and it is built in Britain, from suppliers who pay UK taxes etc. what sort of percentage comes back in taxes to the Treasury?
What with corporation tax, business rates, income tax, stamp duty, VAT, not to mention CGT and IHT my guess that around 95% will either stay in the economy or come back as taxes. Then if on the back of such a contact the suppliers can win some export orders (like the Merlins for Algeria) the govt can pocket even more in tax.
HMRC have got to some kind of model or formula for this. The QE & PoW carriers must be another example and if we end up with a contract to build one for India or Australia then that's got to be good news....unless we flog then off cheap and don't get to keep the first two......
What am I missing here?
MB