Political

Tory tax priorities: cuts for the richest, please

Back to my favourite Conservative Party policy document, the one from John Redwood and co. Having covered its impressive ability to squeeze four different, contradictory proposals on data protection into the same document, not to mention its use of figures that are a decade out of date, it’s on to taxation this time.

Chapter 10, section 6, pages 82-3 is the list of proposals. And what do we find?

  • Tax cuts on company profits.
  • End of inheritance tax.
  • Reduction in capital gains tax.
  • Reduction or abolition of stamp duty on shares.
  • Reduction in the number of people paying the top rate of income tax.

And that’s it.

Now, some of those individual measures might sound quite attractive. But can you spot what they’ve all got in common? Yup, they are all tax cuts from which only a relatively small proportion of the population would directly benefit. This isn’t a balanced package from which everyone – or just those most in need of help – would benefit.

On income tax, for example, the specific recommendation is to cut the number of people who pay the highest rate of tax, and that’s it. Tough luck if you are one of those “hard working families” so beloved of twenty-first century politics which pays the standard rate – no income tax cut recommendations for you. And that says a lot about the real Conservative instincts when it comes to policy.

Contrast that with the Liberal Democrat priorities for tax – a mix of some of these proposals, but with in addition tax cuts across the board (4p off the basic rate of income tax), a simpler system, and extra help for those most in need.

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