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The two main parties are being extremely deceitful regarding taxation. The Labour party is pledging “No increase in income tax”, but artfully stepping around questions regarding raising National Insurance. They (specifically Alan Milburn today on The Politics Show) claim that people are able to distinguish the two. Rubbish. Income tax to the majority of people is the total tax paid on income. Add in the principal of fiscal drag (definition) which Gordon Brown has become a master of, and the tax burden continues to rise.

The Tories are worse still. Their mathematics simply do no add up. Pledging the same spending, whilst campaigning on a tax cutting agenda (as the sacking of Howard Flight brought sharply to light). Both main parties talk of “cutting waste”, which does not instill any confidence in me that either knew what they were doing in the first place when the money was first allocated: Waste doesn’t just appear over night.

Here’s where my allegiances show: I think the Liberal Democrats are proving the most honest in this election. Up front they are stating that they will increase taxation with a new 50% income tax band, for those earning over £100k, and revisiting the very unfair council tax by replacing it with a local income tax. There is a hidden tax time bomb for a lot of people in the forthcoming rate readjustment which is being side-stepped by the Tories and Labour: It’s going to hit a lot of people very hard, and very unfairly (as any tax based on property price is), and it’s strange it’s not being mentioned more in the debate so far.

Unfortunately, a belief that an increase in taxation is likely is very rarely going to win votes. The 1992 election demonstrated even an inaccurate perception of an increase in tax can be costly, which is why both of the main parties are dancing about one another in this strange game of call my bluff..

To me at least, the main question rides purely on the definition of personal income tax. I’d argue the simplest definition is best: Income tax is the total money taken from my income by the Government. If that’s going to rise (as an increase in National Insurance would), it’s a rise in income tax, and Labour have not ruled this out. The sooner the main parties, particularly Labour, are honest about “increasing income tax”, the better for all concerned. We might at last then be able to have a grown up debate on how much of what is spent by the government is paid for.

This entry was posted on Sunday, April 10th, 2005 at 12:45 pm and is filed under British General Election, Politics. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.