As the Chancellor prepares to deliver his Budget on Wednesday, the TaxPayers' Alliance has called for spending reductions to repair the public finances and ease the burden on hard-pressed families.
Despite tough talk on spending by politicians, the truth is that it hasn't come down quickly enough. Spending projections set out in previous Budgets and Autumn Statements have slipped and that has cost taxpayers billions of pounds.
Jonathan Isaby, Chief Executive of the TaxPayers’ Alliance, said:
"While the Chancellor deserves some credit for steering the economy through difficult times, much of the action which was urgently needed to bring spending down and sort out the nation's finances sadly never took place."As well as declaring war on waste and lighting the elusive bonfire of the quangos, big decisions should have been taken to reduce spending for the longer term, including getting rid of 'ring-fenced' spending, scrapping wasteful projects like HS2 and abolishing entire departments like BIS and DCMS.
"What's more, there have been too many missed opportunities to reform pernicious taxes like Stamp Duty and ineffective ones like Corporation Tax, and the Chancellor should follow through on his talk of tax simplification. There is no longer any room for complacency in a global economy that is far from settled."
The TaxPayers' Alliance produced a rigorous and fully costed Spending Plan in March 2015.
Commenting on specific policy areas, he said:
Fuel Duty
"75 percent of the pump price of petrol already goes straight to the Chancellor. This is a punitively high tax that hits the poorest hardest, hitting those doing the school run, getting the weekly shop or driving to work. At the very least the Chancellor should rule out any increases for the remainder of the Parliament."
Cancel Hinkley Point
"It’s time to pull the plug on this farcical project which would see the government guaranteeing an electricity price nearly more than triple the current market rate. This just ends up on family bills, which are already massively inflated by green taxes and years of misjudged policy decisions."
Corporation Tax
"Corporation tax is not fit for the 21st century and it's undermining what is already weak public confidence in the tax system. It would be a huge disappointment to hear more empty words about for "clampdowns" at the Budget and it would only mask a failure to act to reform taxes. A single tax on income distributed from capital should replace corporation tax altogether."
The TaxPayers' Alliance convened the 2020 Tax Commission with the Institute of Directors, and in 2012 it released its final report, The Single Income Tax. That recommended replacing corporation tax with a tax on distributed income.
Click here to read a recent briefing note on this proposal
Stamp Duty Land Tax
"Stamp Duty on property is a strong candidate for the worst tax in the country. George Osborne made it slightly less bad for residential property by removing the slab structure, but it remains in place for non-residential property. Overall, rates are far too high and this gums up the housing market. At the very least, the Chancellor should end the slab structure for commercial property and cut rates - he might even bring in more money by doing so."
The TaxPayers' Alliance brought Stamp Duty reform on to the political agenda through its Stamp Out Stamp Duty campaign. You can read more about it here.
Stamp Duty on Shares
"The economic damage done by Stamp Duty on shares significantly outweighs the £3bn annual revenues. At a time when pension fund deficits are increasing, abolishing this tax would lift a significant burden from them and help savers."
TPA spokespeople are available for broadcast interviews in the run-up to the Budget and on the day itself. Please call 07795 084 113 (no texts)