UKIP today announced a number of new policies, the details of which can be found here. Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance, responded by saying:
“For every good policy announced today, UKIP conjured up a bad one. Despite all the talk of simpler, fairer taxes, many of the proposals announced today will only increase taxes and add further complexity to our already baffling tax system. The frankly bizarre “luxury tax” on handbags and Jimmy Choos would be a nightmare to administer, add hundreds of pages to the tax law books, and would send a very strong anti-aspiration message.
“All parties should promise to abolish the unfair and unjust Inheritance Tax, and the Barnett Formula needs significant reform. But where were the radical proposals to reduce spending? It’s wrong to claim savings from HS2 – which should be scrapped – could pay for anything else, as the money needs to be borrowed anyway. Tax cuts deliver economic growth and raise money in the long-term, but they must be accompanied by clear proposals showing how to bring the deficit down.”
Responding to Labour’s plans to introduce a number of taxes and increase spending on the National Health Service, Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance, said:
“This was sixth form socialism of the most uninspiring kind. It is lazy and dangerous to implement populist measures that won’t raise the money politicians promise. Windfall taxes will hurt pensioners who rely on stable returns for a comfortable retirement, sin taxes hit the poorest hardest, and a Mansion Tax would be a vindictive gesture that will eventually find its way down the property ladder to hit much less expensive homes, too.
“If we want more money for essential services and cancer drugs in the NHS then there must be a serious and sustained war on wasteful spending, alongside a rigorous reassessment of priorities.”
And here’s why.
Politicians can’t be trusted
Property is already heavily over-taxed
It would be an administrative nightmare
It would distort the market
The NHS can improve how it spends taxpayers’ money
Over the last ten years, there has been significant real growth in the resources going into the NHS, most of it funding higher staff pay and increases in headcount. The evidence shows that productivity in the same period has gone down, particularly in hospitals.
Students dressed as pirates, cartoon characters and much more besides wandering along the streets of Exeter — it had to be Freshers’ Week! More soberly dressed University of Exeter students gathered for a Freshers’ Week TPA event at the Imperial pub, a favourite with local students for many years and situated next door to the campus. Continue Reading
After the No vote on Scottish independence, the TaxPayers’ Alliance (TPA) is calling on Westminster politicians to urgently address the substantial constitutional and financial issues thrown up by the referendum result.
As the polls tightened towards the day of the vote, the leaders of the three main parliamentary parties in London promised to protect the Barnett Formula, which since the 1970s has been used to allocate British taxpayers’ cash between England, Scotland, Wales, and Northern Ireland.
However, there is a substantial public spending gap that exists between England and the three home nations with devolved powers – with even Lord Barnett himself, who designed the formula, calling it a “terrible mistake” and “national embarrassment”.
In 2012-13, public spending per head in each of the home nations was:
In an era of devolved government, such spending gaps have become increasingly difficult to justify. Should higher public spending in some home nations be subsidised from taxpayers elsewhere? Why shouldn’t those areas pay for their own promises through higher local taxes?
The Barnett Formula cannot possibly survive. Little more than a crude back-of-the-envelope rule for splitting annual increases in public spending, back in 1978 it was a short-term expedient. It was never designed to last for thirty years and to bear the public scrutiny and resentment it now engenders.
Reform is essential – but politicians have promised to maintain unequal shares.
Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance, said:
“The people of Scotland have spoken, but in their last-ditch attempt to save the Union politicians have also saved the unfair Barnett Formula. It is outdated and has spectacularly failed to address the extremely inequitable situation of taxpayers from one home nation heavily subsidising others. English taxpayers want an end to subsidising Scotland and the Scottish Government wants financial control devolved to Holyrood, so now is the ideal time to abolish the Barnett Formula entirely.
“Furthermore, as even more power is set to be handed to the Scottish Parliament, the time has come to end the anomaly of Scottish MPs voting on policy for other parts of the UK where Westminster MPs have no such say North of the border. English votes for English laws is the only fair way to proceed.”
In 2008, TaxPayers’ Alliance Research Fellow, Mike Denham, authored Unequal Shares, a paper examining the Barnett Formula and public spending across the UK. You can read it in full here.