Wake up to Gordon Brown (2): Tax

"What is the difference between Gordon Brown and Robert Maxwell? Maxwell at least intended to give the stolen pension money back."

That comment was made by one of the Members of the ConservativeHome Panel.  I think it was Peter Lilley who awarded Gordon Brown with the 'Robert Maxwell Memorial Prize' for his £5bn a year raid on Britain's private pensions.  "Pensions" was the word that recurred more than any other in the responses from the Panel: "Browns biggest mistake has been on Pensions - a point we must highlight again and again."

The Chancellor's tax on pensions provision is only one of 66 extra tax rises imposed by Britain's Red Chancellor.  This pdf shows how UK tax levels are rising faster than our competitors and the overall tax levels are exceeding those of Germany.  Gordon Brown is steadily undoing the supply-side benefits of the Thatcher years.   There is also the problem of an increasingly complex system.  According to the World Economic Forum the UK is 67th in the world for tax simplicity.  We share that dubious honour with the African nation of Benin!

After pensions, council tax rises produced the most anger: "Council tax is the biggest single financial issue giving concerns to residents. It is over 10% of my pension income."  Another Panellist said: "We pay more & more tax for less & less benefit - 2006/2007 council tax bills will be the next demonstration of this."

The regressive impact of Brown's stealthy taxes also angered Panel members.  One member urged Tory strategists to "target the issue of the poor paying a higher proportion of their income in tax than the rich and show how the Tories would correct this imbalance - it could show tax cutting but as a means to benefit the poor not the rich."  The 'Wake up to Gordon Brown' series will look at Gordon Brown's social justice record tomorrow.

Inheritance tax was another bugbear of Panellists: "Inheritance Tax Inheritance Tax....come on get a grip.... these are are easy votes... lets us have wealth cascading down the generations..... or is that no longer Tory policy."

I finish this entry with two practical recommendations from Panel members - they are well worth CCHQ adopting:

"An on-line tax calculator where people fill in their details and we calculate just how much their taxes have risen since 1997. Then ask them to rate various services and how they have changed since 97 - much better/ a little better/ no real change/ a little worse much worse. The website would then reveal how much more had been spent on that service and provide some choice details. eg You believe the NHS is about the same standard as it was in 1997. Under Labour spending of your tax money on the NHS has increased by 67%. For the first time ever, the number of administrators now exceeds the number of hospital beds. The number of operations cancelled has increased by...."

"No-one truly comprehends what billions look like, but they understand that they could have had another holiday or a new computer for their children etc. It really has to be explained to people in basic pounds, shillings and pence(!) how much poorer they are today as individual pensioners because of Gordon's raid on pension funds and how much a person in their 50's today will be disadvantaged in 10/15 years time."

PREVIOUS ENTRY IN THIS SERIES: GORDON BROWN'S RECORD ON ECONOMIC COMPETITIVENESS.

Comments

[James Schneider]

The online tax calculator is a superb recommendation. The electorate is waking up to the full meaning of Blair and they don't like it. Gordon needs to be exposed as the reckless chancer he is.
The emphasis must not be that "the country is worse now than in 1997". No one will believe that; I don't believe that. The emphasis must be placed on how Gordon is reckless and Osborne/Cameron will empower the poor, embolden the middle classes, and create a country that is no longer worse than Ireland or Australia.

[Ted]

One useful way I was once given to comprehend big numbers was to put it as "a billion pounds is approximately equivalent to spending £1 every minute since Christ was born" (presumably equivalents exist for Judiasm, Islam etc)

On a more serious note while I support both the proposals at end of editors piece, have we an answer to "so what would you do?".

The pensions grab has resulted in closure of funds - we can't reverse those. If we reversed the tax grab what would it do? What has been affect of loss of billions of funds to Stock Markets? How much worse has position been made by government regulations on investments in gilts rather than shares? etc. etc. And what will we do to restore contributory pension schemes to the health they enjoyed in 1997 if anything?

I realised yesterday that our performance against NuLab is like the current English Rugby team - we have possession then let ball slip out of our fingers, we pass badly, we lose it in a ruck, we punt it up the field to no purpose. It needs concentrated effort, it needs good tactics but most of all we need speed of response, teamwork.

Brown hasn't been a failure, he has kept economy stable but he has laid the foundations for failure as his stability is stability at a lower rate of growth, stability at a worse quality of life, at a great social cost by increasing the dependency culture.B ut he is also a member of a strong team whose tactics have been honed to perfection - we must up our game if we are to defeat him.

[Editor]

This has just been press released by CCHQ:

"As council tax bills are being posted to households across the country and ahead of the Budget, new research by Conservatives has revealed the full scope of Labour’s local tax hikes since Gordon Brown’s first Budget.

· The total tax take from council tax has rocketed by £12 billion since 1997. This is equivalent to 4 pence on the basic rate of income tax.

· New opinion research, by ORB and commissioned by the LGA Conservative Group, has revealed that 72 per cent of people think the amount of council they pay is ‘too high’.

· Bills from April will hit £106 a month for a typical household in England, £94 a month on Band D in Scotland and £80 a month on Band D in Wales.

Eric Pickles MP, the Shadow Minister for Local Government, said:

“Hard-working families and pensioners are suffering from ever-increasing bills – higher gas, electricity, water and most painfully, council tax. No wonder young couples find it so difficult to get onto the housing ladder, when ever-increasing living costs make it really hard to save for a deposit or service a mortgage.

“Despite Tony Blair’s pledge not to increase income tax, he has hiked it up by the back door. The stealthy increase in council tax is the same as 4 pence on income tax, but local councillors, rather than Mr Blair and Mr Brown, will get the blame when bills hit the doorstep.”"

[Michael McGowan]

All true but Ted is right: there has to be a much more convincing answer - and it will not be easy answer - to the question: what would you do instead? Is Oliver Letwin listening?

[Mark Fulford]

"The stealthy increase in council tax is the same as 4 pence on income tax, but local councillors, rather than Mr Blair and Mr Brown, will get the blame when bills hit the doorstep."

However, it is fair that local councillors should take some of the blame. The parish element of my Band D tax is now well above £100 per year - because 12 local do-gooders are spending money like water on a bunch of stuff nobody needs, uses or wants.

[TimC]

The tax calculator is an excellent idea - the LibDems had a similar thing on their site at the last election which helpfully worked in our favour. A friend's sister who was contemplating the LDs went back to voting for us after seeing how much extra tax she would pay under them.

As for the Pension Credit, we should point out how unfair it can be. I was speaking to a 65 year old lady who despite having had poorly paid jobs all her life had managed to save £30k. She has now been told that this means that she can't receive the credit as a result and is terrified how she will be able to afford her local council tax bill.

[comstock]

"Inheritance Tax Inheritance Tax....come on get a grip.... these are are easy votes... lets us have wealth cascading down the generations..."

In other words those that are already at a considerable advantage by being born into a wealthy family should be helped further, even if that means less in the pot for schools, hospitals and police, yes?

[a-tracy]

Comstock - why should a government have a right to tax something that has already been taxed? For most people you are talking about money they've saved or stretched themselves into buying their properties (you know doing without holidays, working overtime, working extra jobs) we're not just talking about those born with silver spoons in their mouths, you're talking about most working families who own property in London now.

[comstock]

"Comstock - why should a government have a right to tax something that has already been taxed?"

If you cut inheritance tax, you have to raise taxes somewhere else, surely, or else cutback on public services. If you don't admit to this you are conning the electorate.

Which is it to be, and what other taxes would you raise?

[a-tracy]

Comstock 12:02 - why not just expect our taxes to be spent better, I have to economise every day both at home and work! We're on a fixed budget and it's getting smaller and smaller.

Why is it conning the electorate they were already taxed to pay for services today - this sounds more like Gordon Brown speak (it's not you is it Mr Brown?)

What concern is it of anybody what I do with my money if it has already been taxed fairly and earnt through my own endeavours, I haven't received a penny in inheritance from anybody and aren't likely to - infact the way taxes are going I'll probably end up looking after my parents!

As for more in the pot for schools, hospitals and police - that's not where it's going is it, it's going into public sector pensions so that union supporters can retire at 55 years of age, whilst stripping private workers pensions bare.

This government has reducing teaching hours, giving a day off a fortnight for marking and planning, and at the same time they are keeping on poor quality teaching staff who are failing year after year to improve the literacy skills of the bottom 30%, as a private individual would you continue paying someone to clean your windows if they weren't doing it? Pretty soon the children will be watching a teaching video with a child-minder so teachers don’t have to go into the classroom at all and that way they all get the same lesson.

Then this government have removed on-call emergency local doctors services, removed NHS dental services (even to children), kicking people out the day after surgery when the night before they were hooked up to a morphine drip they were in so much pain – the patient then doesn’t want to go back in and wait for four hours in A&E to get some better pain relief! Paying more - getting less.

The police - it's getting to be 'what is the point of them' when as soon as they catch up with people the c.p.s doesn’t bother to prosecute or they're soon back out on the streets re-offending. They target politically incorrect wrongdoers whilst letting drivers off who haven’t passed their test, drive with no insurance because they’re broke and can’t pay the fines anyway!

Well that’s how it seems to me anyway.

Oh just one other thing that bother’s me – I don’t want my taxes going to pay perks to people like Ruth Kelly to support a home she doesn’t live in, I see the adverts targeting benefit fraudsters, it would hold more sway if the governing classes didn’t rip off their benefit pots! There is just no accountability.

[comstock]

"This government has reducing teaching hours, giving a day off a fortnight for marking and planning, and at the same time they are keeping on poor quality teaching staff who are failing year after year to improve the literacy skills of the bottom 30%, as a private individual would you continue paying someone to clean your windows if they weren't doing it? Pretty soon the children will be watching a teaching video with a child-minder so teachers don’t have to go into the classroom at all and that way they all get the same lesson."

Congratulations a-tracey, that post has just made me angrier that anything I've ever read on any bulletin board anywhere!!!

My sister teaches primary school children.

Have you *ANY* idea how much work those people put in????? Evenings, weekends, holidays....marking, preparing, running after school clubs, attending parents evenings, buying materials out of their own pocket, spending their lunch breaks helping kids, running activity camps (on duty literally 24hours a day whilst there)

[a-tracy]

Comstock - you cannot speak for every teacher in every school based on your personal experience of your obviously dedicated sister.

Our school has lunch time assistants, the after school club isn't run by teachers but by paid carers, the after school football club is run by the local football team that we pay extra for, during the holidays the school is closed and the children can't use the play equipment because the gates are locked. If the government continually change the national curriculum and prescribe teaching methods then you should question them as it's this that increases the workload on many teachers.

Our local school has started holding parents evenings during the day which means we have to take time off work and pay extra to look after the children who aren't in school for the day.

As for being grateful it's my taxes that pay her wages, her holiday pay, her sick pay, her full maternity pay, and her pension. Shouldn't she be grateful for the taxpayers for her job. You don't know how hard I work in order to pay the taxes that support her and people like her so stop making assumptions that you have no idea about. As I've stated before I've worked from the age of 16, never claimed benefits, never worked less than a 47 hour week and for the first fifteen years of setting up several businesses worked over 60 hours per week with just christmas week off, I'm not after gratitude either.

[Mark Fulford]

a-tracy, your CV is very interesting. Does the 47 hours include time on ConservativeHome?

[a-tracy]

Mark you are cheeky :-)

In my defense I am a woman and therefore multi-tasking and b) I can type with both hands!

One thing is true though it is far too distracting and anything that doesn't get done in the office between 8 and 6 gets taken home!

[True Blue]

A-Tracy,

Teaching - what a laugh! It makes you wonder why people bother doing any other job. It's a free job market, so people must be queueing round the block to sign up to this teaching lark. Just a few years in college, stroll into school, switch on the teaching video, then lean back and suck on that fat Havana while the taxpayer pours oodles of cash into your fat wallet.

[True Blue]

The complexity of the income tax system is ridiculous. For low earners it is a nightmare. It needs to be fixed. This is Gordon Brown's most unpleasant gift to the low paid. Raise the tax-free threshold massively and take as many people out of income tax altogether. Increase this threshold year on year.

Inheritance tax. This already affects 6% of people, and the vast majority of people who get inheritance cash get it from their parents when they are aged over 40. When you are 40 with a fat mortgage and a bunch of kids, you could really do with the money, and paying tax after the first 275,000 is really unfair. Such people could really do with a tax break on sums above this amount.

[comstock]

"Shouldn't she be grateful for the taxpayers for her job."

Gratitude is what you should feel when you get something for nothing. That clearly isn't the case as a) she works very hard for her money and b) since every taxpayer went to school at some point, they are clearly paying for something they have themselves received. Getting damn good value for money too IMHO.

"You don't know how hard I work in order to pay the taxes that support her and people like her"

Support? Again implies getting something for nothing, sponging almost. If you think about it we all ultimately 'support' other people with everything you earn, whether it goes on taxes to fund teachers or food that gives supermarket staff and farm workers jobs......

[True Blue]

Support? Again implies getting something for nothing, sponging almost. If you think about it we all ultimately 'support' other people with everything you earn, whether it goes on taxes to fund teachers or food that gives supermarket staff and farm workers jobs......

If you think of yourself as a customer of public services, that should give the right attitude. That is, you are paying them to perform a valuable service. If they perform badly, they should be held to account. The unfortunate thing is that it is very hard to hold public servants to account, whereas in most places in the private sector you simply choose whereelse to spend your money. This is one of the numerous advantages of the private sector.

When people talk about "cutting" public services, I don't think that's the right way to think about. You are simply deciding that people should be able to pay with their own money for the same services, if they want them. Of course, you need a safety net for the poor for services which are absolutely necessary. When looking at government expenditure, you need to ask - why is the government doing this? Could it be done by private enterprise? If the answer is yes, give the money back to the people, and let them spend it where they want.

[Ted]

True Blue

Nub of the problem - we pay but have no obvious say over the services or means that those services are supplied; a vote every four or five years on principles but very little over the quality at point of delivery.

a-Tracy feels she isn't getting good value, she doesn't see the results from her tax (at least she is consuming some benefit - as a single man in a rural village I get rubbish collections, minimal road maintenance, emergency health cover and protection from invasion can't think of much else)

comstock sees the effort that teachers are putting in (true for many I know).

That's why choice, independent provision of funded services is the way ahead. Plus localism - if school was independent and responsible more directly to parents then a-Tracy might understand better why as well as being able to influence the how.

But also guys & gals remember it's Gordon who is the enemy here!

[comstock]

"When people talk about "cutting" public services, I don't think that's the right way to think about. You are simply deciding that people should be able to pay with their own money for the same services, if they want them"
The problem arises, of course, when the amount of the tax cuts is less than the cost to those that need the service. If you start tax cuts at the very lowest end of the income scale you may be able to offset this but most things the government spends money are things which by very definition can't be provided properly by the free market-education for all being a prime example.

"The unfortunate thing is that it is very hard to hold public servants to account, whereas in most places in the private sector you simply choose whereelse to spend your money.This is one of the numerous advantages of the private sector.
"
And the problem is that clearly the private sector is looking to build a profit margin in-at every level. Look at the privatised railways for example.

Whilst I'm not denying there has been some very wasteful spending at local goverment level, some (not all) by 'old Labour' councils, in terms of value for money I think that your tax pound that goes to pay for teachers and nurses is the best value for money you will get anywhere. Period.

[comstock]

"at least she (a-tracey)is consuming some benefit - as a single man in a rural village I get rubbish collections, minimal road maintenance, emergency health cover and protection from invasion can't think of much else"
Well for a start we can add police and fire to that list. (surely the private sector could never provide fire cover anywhere near as well)

But surely you went to school when you were younger, and intend to claim a pension and use the NHS when you get older?

Do you use a local library or swimming pool? Public transport (including the railways which couldn't run without state subsidy)?

OK last post for today....I've made my point I think :D

[Ted]

comstock
agreed there are other things that provide/provided benefit and I'm actually happy to pay for education, health, social security, police, fire etc. but
- educated outside UK for primary, privately for secondary, didn't get grant for university so education N/A
- NHS emergency op probably saved my life but also then close to death and gave me MRSA but also have private health insurance
- nearest police (part time, part week) several miles away Salisbury station is the nearest full time one 20 miles away, lost our village policeman 30 years ago. But one of the lowest crime areas in the country (one crime vandalism to car number plate I think in last three months)
- Fire, haven't needed them but happy to pay.
- work from home, company pays when I need to use public transport. Council does provide a Wriggly bus (routes according to passenger location) for those without car but I've got one.
- Libraries? swimming pools? - Salisbury too far to go

[True Blue]

The problem arises, of course, when the amount of the tax cuts is less than the cost to those that need the service. If you start tax cuts at the very lowest end of the income scale you may be able to offset this but most things the government spends money are things which by very definition can't be provided properly by the free market-education for all being a prime example.

It's that "most" which is the nub. It's there where we find the space to cut taxes. Public bodies waste a fortune doing things better done by the private sector.

There's nothing wrong with the profit motive. It drives private business to do the most amazing things. As long as there is the possibility of competition to drive innovation, the private sector should be involved.

Gordon Brown is wasting more and more of your money on things we don't need, things we should be able to decide ourselves. Why should I subsidize letters to the Outer Hebrides? What on earth are the DTI doing - why does it even exist? Why are we spending ridiculous amounts of money per library book we lend? Why are we squandering excess money on the NHS with not much to say for it, and a budget overspend of nearly 1% (imagine the reaction to a private company which overspent that much.) Did you now that we are now subsidising sex changes at a cost of £8000 each?

[Patsy Sergeant]

'It really has to be explained to people in basic pounds, shillings and pence(!) how much poorer they are today as individual pensioners because of Gordon's raid on pension funds and how much a person in their 50's today will disadvantaged in 10-15 years time.'

It will have to be repeated more than once, and very clearly to have real effect.

[Andy Cooke]

On Oberon Houston's article "Through the Looking Glass", Brown gives us one stick with which to beat him:

When talking about the fraudulent claim that the Tories were planning to cut £35 billion, he says "£35 billion is so massive a figure that it is the equivalent of sacking every teacher in the country, then sacking every GP in the country and then sacking every nurse.”

So, fine. We're sold on that £35 billion.

Under the public spending plans at the last election, Labour are planning on spending £550 billion in FY 06/07.

So how about that other £515 billion, then?
(to be fair, Labour's welfare handouts are more than three times the combined salaries of every teacher, GP and nurse in the country, so that takes up a fair amount of it - strange that Brown didn't mention that ...)

[Margaret]

This is based on a proposal by Richard Littlejohn: Issue every tax payer with an annual itemised list of how their hard earned money has been spent by our politicians. So you would have something like this:

Wars: £200
NHS abortions: £50
Incapacity benefit: £1320
Maintenance of the children of absent fathers: £650
Extra professional politicians and assemblies: £200
EU membership: £380
Quangos: £730
Compensation payments to people made ill by dirty NHS hospitals: £120
Cost of administration of benefits system: £320

and so on..

(I haven't calculated what the relative figures would actually be. I made them up purely for illustrative purposes)

I think that it would make politicians more accountable. Because of PAYE, people are not as aware as they could be of how much they are paying. It would be a simple calculation to do (the Inland Revenue would simply apply a percentage for each item to everyone's bill).

That should wake the electorate up.

[comstock]

"Public bodies waste a fortune doing things better done by the private sector.

There's nothing wrong with the profit motive. It drives private business to do the most amazing things. As long as there is the possibility of competition to drive innovation, the private sector should be involved"

OK name me, please, a public service that is better for market forces being introduced to it.

Just one will do!

[Andrew]

OK name me, please, a public service that is better for market forces being introduced to it.

Opticians.

[a-tracy]

Telecoms

[comstock]

Telecoms I will give you (more by luck than judgment unless somebody accurately forsaw mobiles and the internet)

Opticians-I don't think so. 150 quid it cost me last year-just for driving too!

[a-Tracy]

Several entrepreneurs spotted the emerging mobile phone market in the early 80's, I've kicked myself ever since for turning down an emerging franchise for a mobile phone network (that was pre-Caudwell getting involved and we know how successful he's been).

Opticians - You can visit an Optician at a time to suit you including Weekends (unlike our other NHS health service providers), you can have a check up for £10 and if you work using a VDU your employer will pay for this check up for you. You can access new internet glasses providers who have greatly reduced glasses charges if you're looking for a cheaper deal. An optician saved my godfather's eyesight, he went to A&E thinking he had brick dust in his eye and they gave him eye drops, a few days later still in pain he went to an optician who diagnosed a slipped retina requiring emergency treatment to save his sight he spent a fortnight in a darkened room on his side to recover.

How much will it cost you from April for an NHS dental check up and crown? If you can find an NHS dentist with room on his/her that is.

[comstock]

"Several entrepreneurs spotted the emerging mobile phone market in the early 80's, I've kicked myself ever since for turning down an emerging franchise for a mobile phone network (that was pre-Caudwell getting involved and we know how successful he's been)."

Yes but you never did want that yacht in the bahamas really, did you?
I hear the weather's dreadful, all hot and sunny and stuff...

"if you work using a VDU your employer will pay for this check up for you"

"How much will it cost you from April for an NHS dental check up and crown?"

Dunno, I have an acute fear of dentists, and with any luck (and a few more Mars bars) I soon won't have any teeth left to worry about anyway :D ;)

[telbert]

No need to debate this subject further - lets just get rid of these crooks at the next election !