The Telegraph’s excellent Tories in Power series continues today with a splendid piece by Tim Montgomerie. Tim argues that:
“The Tories’ next moral target should be the taxation of low-income workers. Income tax is taken from many poor families, churned through an expensive bureaucracy and then returned in benefits.
It would cost £44 billion to take approximately 14,000,000 people out of the tax system altogether. The Conservative government doesn’t have to set a timetable, but it would be the greatest of missions; as radical and just as Margaret Thatcher’s sale of council homes. It would sow panic in Labour’s heartlands.
The difference between freezing public spending and growing public spending at the same rate as Labour is £12 billion a year. Conservatives could complete the mission within one parliament if they froze spending – after inflation. They could hit the target within a decade if spending was simply put on a more sensible growth path and some of the savings also used to finance lower corporate taxation. Conservatives would be reducing bureaucracy, rewarding work and freeing millions from the complexity of the means-tested benefits jungle.”
Taking the poor out of tax completely is the right thing to do both politically and morally. It is hard to depict tax cuts as ‘greedy’ when they are going to some of the worst off in society. The Tories can avoid the charge that they’ll have to cut spending on schools and hospitals to pay for these tax cuts by detailing how they will raise green taxes to cover the transition costs. Shifting the tax burden from work to waste should be one of the major priorities of a Cameron government.
Comments