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Britain Crafts Tax Plan to Help Address Country’s Economic Ills

The British Parliament on Monday considered changes to its income and sales taxes as a means to alleviate the economic downturn. Margaret Warner reports from London about the proposed stimulus plan.

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  • JIM LEHRER:

    Next, Britain tries its own economic stimulus package. And Margaret Warner reports on that from London.

  • MARGARET WARNER:

    It's a month before Christmas, and London's Oxford Street is filled with would-be shoppers, gazing at the glittering window displays, but mostly free of shopping bags. And salespeople say customers haven't opened their wallets yet.

  • CAB DRIVER:

    We've been the first to feel the crunch.

  • MARGARET WARNER:

    One of the best barometers of London's economic health are its cab drivers.

  • CAB DRIVER:

    The business is really right down. We have to be in the cab seven days a week to earn any money, really.

  • MARGARET WARNER:

    And today Prime Minister Gordon Brown unveiled his latest recession fighter: a nearly 20 billion dollar pound stimulus package with a temporary sales tax cut and a bit more spending on infrastructure.

    This comes not a moment too soon for Britain. The retail sector is hurting; homes aren't selling; unemployment is its highest in 11 years and forecast to get worse; and the British pound has lost a quarter of its value against the dollar.

    All that means Gordon Brown has an anxious British public to reassure.

  • JAMES MAX, Radio Talk Show Host:

    Five minutes past 5:00, you are listening to "Business Matters"…

  • MARGARET WARNER:

    Just six months ago, London radio talk show host James Max was fielding calls from listeners looking for advice about how to profit in a booming economy. No longer.

  • JAMES MAX:

    The kinds of questions that we're getting are, "I've got money in my bank account. Is it even safe?"

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