Originally Posted by
smujsmith
I despair at the way that governments have given way and allowed our manufacturing industry to decline.
The only industry that the Government has direct control over is Defence. It had indirect control over many others through subsidies - who provides the money for subsidies - an others through business rates, minimum wage, taxes etc etc.
We don't like paying taxes so for a free market economy subsidies were reduced or abolished. Just remember though who doesn't permit State subsidies.
One taxes, just who sets VAT rates? A good may be zero rated but another have a higher rate. Once VAT exceeds 15% the Government is powerless to reduce it below 15%.
Who directly allows manufacturing to decline? We do, ably assisted by the EU.
We are then betwixt the proverbial. Build a British fighter aircraft and
we keep the cash in UK by means of all the taxes - company tax, business rates, VAT spend by the workers - and perhaps 80% or more remains in UK. If we can't export it though we lose economies of scale.
If we buy foreign we lose expertise, the money goes, and we also lose some operational clout.
Maybe the old system, build and sell a first rate and affordable airframe, allow the customer to install the cocktail cabinet and carpets or the missile system was better.