I would also suggest doing away with all allowances except quite reluctantly just very simple necessary ones for political expediency - pensioners and children. I would also suggest that income tax should start at nil income to avoid the tax trap, albeit with a low 10% rate. All money received and capital gains, doing away with indexation allowances, will be taxed as Income Tax and Local Income tax. Indexation of capital gains is inconsistent with no indexation of interest income or salary. The proposals should be broadly neutral with administrative and tax avoidance savings and much increased simplicity and transparency. Much effort is spent in converting income to dividends and capital gains. Tax forms would accordingly be much simpler and the armies of accountants and inspectors creating and attacking avoidance schemes would have to be gainfully employed elsewhere.