We have published our post-Budget briefing this morning, complete with graphical illustrations to complement its analysis of the Chancellor’s announcements.
The key findings are as follows:
The Chancellor of the Exchequer, George Osborne, announced a number of welcome measures to relieve the tax burden on struggling families in today’s Budget, including:
However, the TPA has warned that the Chancellor is still relying too much on complicated measures to help specific industries, rather than making fairer and simpler changes to the overall tax structure.
Reacting to today’s Budget, Matthew Sinclair, Chief Executive of the TaxPayers’ Alliance, said:
“George Osborne has announced welcome relief for people struggling with the high cost of living. The cut in beer tax, the freeze in fuel duty and the higher personal allowance will all ease the pressure on family budgets. Lower Employers’ National Insurance and Corporation Tax will also be passed on to workers in higher wages.”Unfortunately, the great limitation of this budget was that it relied far too much on complicated targeted reliefs instead of tax cuts across the board. Simpler, strategic tax reforms that reduce the overall burden would be fairer and do more to produce the stronger economy Britain needs.”
This afternoon Parliament will likely make emergency changes to welfare legislation following the fallout from the Cait Reilly Poundland case . Critics of the policy being pursued by the Government, such as Shiv Malik in this particularly misleading Guardian article, argue that the DWP is somehow seeking to strike down the Court of Appeal judgement deny claimants compensation that they deserve for being made to “work for the benefits”. Don’t believe this nonsense. They are adjusting legislation that was illegal because of the way it was introduced, not what it did.
Campaigners in the Poundland case sought to portray the Work Programme as modern day slavery (something that is frankly insulting to those who have experienced genuine slavery in the modern era) and a breach of claimants’ “human rights”. The Court of Appeal utterly rejected this argument. Whilst ruling that the legislation used in Parliament to introduce the scheme was flawed, it certainly did not reject the principle of expecting those out of work to take part in mandatory work experience in return for some of their benefits. Continue Reading
Cornwall Council was caught hopping by the surprise freeze in Council Tax forced on them by opposition councillors, says Cornish MP George Eustice. The Conservative run council had planned to raise its Council Tax by 1.97% just below the threshold needed to trigger a local referendum. But the opposition Lib Dems were joined by some backbench Tories to pass the freeze in the budget by 52 votes to 49.
Cornwall’s cabinet had argued that a rise in Council Tax was needed to protect frontline services but the opposition said their budget could freeze the tax and make savings of £4.6m by giving local residents exactly what they wanted rather than wasting money on unwanted council expenditure. ‘What I hope will happen,’ says MP Eustice, ‘is that, after council elections in May, the new regime will be able to have an emergency budget and have a proper look at how to deliver these savings but do it in the most sensitive way.’ Continue Reading
A new book by the Adam Smith Institute’s Research Fellow JP Floru assembles a small mountain of anecdotes, statistics and historical analysis to make a powerful case. Tougher regulation, high government spending and the high taxes that are required to pay for it all destroy growth and leave end up making everyone worse off. Heavens on Earth: How to Create Mass Prosperity looks at eight countries in terms of low taxes, free trade, light regulation and how changes in policy have led to dramatic changes in prosperity.
Two countries stand out from the crowd, Hong Kong and Singapore. While Britain has had a government which has consumed and taxed between 35 and 50 per cent of national income, in those two countries the proportion has been between 10 and 25 per cent. With a much smaller government holding back the economy , the results have been remarkable: Continue Reading