Matthew Sinclair: DIY Tax Transparency
By Matthew Sinclair of The TaxPayers' Alliance.
The process of really opening up the public sector started under Labour with the Freedom of Information Act. The MPs' expenses scandal ended for our generation the argument that we could just trust the checks on spending within the public sector. Since the election, the pace at which spending is being opened up to public scrutiny has increased to an incredible degree. From councils to Government departments; from the COINS database to council payments to suppliers. We know more and more about how our money is being spent.
It will take some time for the full effects of that transparency to be felt. Journalists and developers are still working out what they can do with it and some of the releases are still a bit of a work in progress. But we should look at other areas where the principle of greater transparency, that sunlight is the best disinfectant as George Osborne said before the election quoting former US Supreme Court Justice Louis Brandeis, can be applied as well. One of those areas is tax. Conservative Way Forward have launched a new campaign for tax transparency with a new leaftlet, which you can download here. We at the TPA have been looking at this area for a while and have similarly looked at how policy could improve the situation. Recently we called for a merger of Income Tax with both Employees' and Employers' NI, with a major report on how it was possible, not just to make the tax system more efficient but also to make it more honest about how much people are paying.
But we can't just sit back and demand the Government fix this issue for us. If we had done that on pay for senior council staff I expect we would still be waiting. Instead we used the Freedom of Information Act to produce the Town Hall Rich Lists so local people could decide for themselves whether the bosses at their local authority were worth it. After a few years, all the political parties came round to the idea that this transparency was a good thing and now councils have to report the details on their accounts like companies and other public bodies.
In that spirit, today we are launching a new online application that aims to help people discover just how much their cost of living is inflated by taxes; the TPA Tax Buster. First how VAT and the duties make things more expensive. Then how you have to earn so much more to pay those higher prices thanks to direct taxes like Income Tax. Add it all together and you're looking at how much tax makes it harder to make ends meet. The app is available for the iPhone on the app store and as a web version that works on your PC, BlackBerry, Android or Windows Phone. Try it out for yourself, but you might want to make sure you're sitting down first.