Tax and the Tories

You wait ages for a Tory tax pledge then a whole slew come along at once. Following his speech on Monday which pledged to raise the threshold for inheritance tax and cut stamp tax for first time buyers, George Osborne has given an interview to The Times announcing that there are both personal and corporate tax cuts to come, all of which will be funded by green tax rises.

Now, the Evening Standard is going big on the story that spouses will be able to transfer over any unused portion of their personal allowances—potentially saving families £1,000 a year. There does, though, seem to be some confusion about whether this is a possibility or if it is set to be announced as a firm policy commitment. Just now, a Tory spokesman told me that the idea mentioned in the Standard is just “one of the recommendations put to us by one of the policy groups. Absolutely no decision has been made on whether this proposal will form part of the manifesto.”

The Tories are walking a fine line here. They need so-called “doorstep changers” to swing people away from Gordon Brown. But they also must avoid falling into the trap they fell into last time of trying to, as Lynton Crosby put it, fatten the pig on market day: if planned tax cuts keep tumbling out they’ll begin to lose credibility. While I’m intrigued to see which green taxes will be raised to pay for all of these cuts.