With The Sun, The Times and The Daily Mail declaring the death of New Labour, it is worth thinking about what a New Labour government PBR would have looked like. For an idea you can look at a PQ that Stephen Byers, someone who has kept and advanced the New Labour faith, asked back in April.
Byers wanted to know how much it would cost to lift half a million people, a million and a million half out of income tax altogether. Interestingly, the cost of lifting a million people out of income tax altogether for one year—by raising the personal allowance by £960—was £11.1 billion. Now, the cost of cutting VAT to 15 percent until January 2010 is £12.4 billion.
So, New Labour might have lifted people out of income tax altogether—helping the poor but also sending out a low-tax message—and not introduced the new top rate of 45p, a measure that will raise less than a billion pounds and is all about politics not raising revenue. I
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