United Liberty

With President Barack Obama telegraphing his fall strategy of raising taxes on the wealthy in the name of “fairness,” we need only look across the Pond to our friends in the United Kingdom where a surtax on the evil and hated rich has actually caused revenues to decline:

The Treasury received £10.35 billion in income tax payments from those paying by self-assessment last month, a drop of £509 million compared with January 2011. Most other taxes produced higher revenues over the same period.

The self-assessment returns from January, when most income tax is paid by the better-off, have been eagerly awaited by the Treasury and government ministers as they provide the first evidence of the success, or failure, of the 50p rate. It is the first year following the introduction of the 50p rate which had been expected to boost tax revenues from self-assessment by more than £1billion.

Senior sources said that the first official figures indicated that there had been “manoeuvring” by well-off Britons to avoid the new higher rate. The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.

Over at Hot Air, Ed Morissey explains why President Obama plans are likely to do the same in the United States:

Obama’s plan to hike capital-gains taxes to 20% and push a surtax on higher earnings will produce the same result here.  The capital that might have gone to work in the US will go to work somewhere else or not at all, which will not just kill the direct revenues expected in static tax analysis from the hike, but also discard the revenues that would have occurred had the capital been put to work here.  That’s the lesson from the British face-plant on surtaxes, and hopefully the US learns that lesson the easy way.

We obviously shouldn’t expect Obama’s campaign to back down from their populist rhetoric despite the results of it in practice. After all, for him it’s apparently a religious belief — that government should force people to be charitable rather than voluntary giving to private organizations.