It is very sporting of John McDonnell to release his tax return for us all to inspect. It is reassuring to see that he isn’t posing as a hero of the working man while living off rent from a property portfolio, and that he hasn’t been working on the side for Vodafone or Google while laying into their tax affairs. Presumably it is the very simplicity of his tax return with which he hoped to impress us.
But that is what is bothering me – the lack of entries. Apart from his income of £61,575 as an MP and a pension of £14,421 from his career in local government he seems to have no taxable income whatsoever. Most worrying of all he appears to have earned not so much as a pound in interest from a savings account.
It is possible that McDonnell has a cash ISA, income from which does not need to be declared on a tax return. Or maybe he has some money under a mattress. But aside from down and outs there can’t be many 64-year-olds who don’t have any cash in a savings account. What happens if the roof of McDonnell Towers springs a leak? Does he know a builder who takes credit, or is he going to give Wonga a call? Or maybe he is just going to get wet until he has managed to save enough to get it fixed.
My worry is that this is how he intends to run the Treasury, with no money set aside for a rainy day. After all, he and Corbyn already seem to have decided that in their government quantitative easing would no longer be simply a device for creating liquidity in an emergency, but a means for funding government expenditure.
Two decades ago, Norman Lamont’s already-faltering career as Chancellor was undermined when it was revealed that he had spent £470 more on his Access card than his agreed credit limit of £2000. For a chancellor running a £50 billion deficit it was a revelation from which he never recovered – even if parallel allegations about him buying cigarettes and champagne to quaff with an unknown friend proved to be unfounded. It is hard to trust a Chancellor who appears to have chaotic personal finances.
That John McDonnell appears to have succeeded in filing his tax return by 31 January – a deadline many will have missed – is in his favour. But his apparent lack of savings could return to haunt him.
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