Gordon Brown's Budget maths 'flaky'.

It looks as though Gordon Brown's budget is not quite as he says:

'It's fair to say his tax-raising measures are rather more flaky than his tax-cutting measures,' said Jonathan Loynes, chief UK economist at Capital Economics. 'His numbers may add up, other things being equal. What they don't take into account is that by closing one loophole, you may persuade people to look elsewhere.'

One of the major guys who advises on tax avoidance has his own theories:

Chris Sanger, tax partner at Ernst & Young, warned that one specific measure, which removes tax benefits for UK firms making overseas investments, would only give a 'short term gain' for the Treasury. Brown is expecting the rule change to bring in £130 million a year in 2005, and £200m for each year afterwards, but Sanger warned that firms would shift their behaviour to avoid being hit by it. 'The UK is competing in an international economy. One effect of this is to make investing in Britain less attractive,' he said.

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