TPA Bulletin - 14th May 2010
Welcome to our new readers
New government, new tax policy
When we sent this bulletin out last week we didn’t know who the next government would be, that seems like a lifetime ago already. This week we write to you as the first details of the terms of the contract between the Conservatives and the Liberal Democrats are being announced. Here are the key points so far:
£10,000 Income Tax thresholdWe’ve been scrutinising what’s been said about tax, and the media have already been contacting the TPA to get our take on the tax policies that the new Government is likely to pursue (see:Politics.co.uk, The Sun).
It is excellent news that this Lib Dem proposal is being adopted by the coalition. It’s simple and sizeable, allowing the average worker to keep £700 more of their own money. This will be an incentive for more people to leave benefits and move into employment.
National Insurance Rise
After bashing Brown's tax on jobs in the run up to the election, new Prime Minister David Cameron has decided that part of it will still go ahead. It looks like the new Government will scrap the rise in employers' national insurance but not employees' share. So now it's just a tax rise on working, rather than a tax rise on employing someone. Unfortunately, this will blunt the impact of the Income Tax threshold change.
Inheritance Tax threshold stays put
The Tory proposal to raise the Inheritance Tax threshold has, disappointingly, been "put on the back burner" by the coalition with apparently no intention to change this in the next five years. We will continue campaigning for the Death Tax to be abolished outright. This hated tax is deeply unfair; when the Conservatives originally announced their policy to radically raise the threshold it resulted in a big jump in their popularity, and voters will continue to demand an end to the Death Tax.
Capital Gains Tax
Is going to more than double from 18 per cent to 40 per cent, in a dramatic hike. This tax grab will see some groups protected (like entrepreneurs), but that protection may not be enough. Politicians need to cut spending and put these tax hikes on hold. Read more here.
Green taxes
Anyone buying or selling a house can breathe a huge sigh of relief as Home Information Pack regulations are going to be scaled back, cutting red tape and hopefully helping the property market. Sadly feed-in tariffs are set to be established, meaning huge subsidies for un-economical things like solar panels on residential properties. The coalition has ruled out a third runway at Heathrow and will refuse additional runways at Gatwick and Stansted.
Also on the cards are a green investment bank, a high speed rail network and a national recharging network for electric cars. Read a full dissection of the environmental policy here.
The run up to the emergency budget will offer plenty of opportunities to identify new, larger spending cuts, which are essential to solving the fiscal crisis. The coalition must pursue the Google Government transparency agenda, which will bring the public into the process of identifying waste. The TPA will continue to lobby the Government to cut spending, in case you missed it last time here's a reminder of our hit list and our commitment to continue campaigning for the abolition of Inheritance Tax and much more is all in our manifesto.
The hustles from Brussels
While almost the whole media focus this week has been on the Blue and Yellow coalition in Westminster, there has been a considerable amount of activity in the Blue-and-Yellow-flagged buildings of the EU, too. As if taxpayers being forced to bail out the banks wasn’t bad enough, measures have been underway to force us to bailout Greece, the Eurozone and any other EU member states that might get themselves into difficulties. Whilst Alistair Darling, in one of his last acts as Chancellor, was keen to insist that he had successfully kept Britain out of the new fund set up to bail out the Euro, the reality is that he was forced to commit British taxpayers to underwriting up to £15 billion should Spain or Portugal follow Greece. Though the Greek crisis was caused by a combination of the irresponsible spending policies of successive Greek Governments, the dishonesty of the Greek authorities when publishing their national statistics and the failure of the EU to properly enforce their own rules, the powers that be in Brussels and Strasbourg apparently see even this as an opportunity to extend their own powers even further. Ever optimistic about the ability of ever closer union and unceasing centralisation to act as a silver bullet for any issue, they are already pressing for “economic Government” in which Brussels has far greater control over each Member State’s economic and fiscal policies. This would be disastrous for British taxpayers, and the TPA will be fighting hard to ensure the EU gets less power over us, not more. We’ll be watching closely to see how George Osborne reacts to the threat at his first meeting of the EU Finance Ministers on Tuesday 18th May.
Beverley Protest
Thanks to all of you who attended the protest rally outside East Riding County Hall in Beverley on Bank Holiday Monday. It was really well attended and we received great coverage in the local papers, on BBC Look North and local radio.
Our demonstration was prompted as the council agreed to pay £364,205 into the pension pot of Corporate Resources Director, Sue Lockwood, who had applied for early retirement. I'm sure you'll agree this is an outrageous sum for anybody to receive, let alone a public servant at a time when local government are truly struggling for money. Read the full background to the story here.
BBC Radio 4 interviewee wanted
We’ve been contacted by a BBC journalist who is looking for people working in the frontline of the public sector who support spending cuts. Do you work for the NHS, the Police, the Fire Brigade or a local council? If you would be willing to be interviewed for Radio 4 about the coming spending cuts in the public sector please get in touch with Campaign Manager Emma Boon.
Best of the blogs
Better Government: How cool do NHS bosses need to be?
Burning our Money: The battle over cuts heats up
Better Government: Suspended manager’s £315k over 5 years
Economics 101: Coalition environmental policy set to hit ordinary families in the pocket
Economics 101: Capital Gains Tax hike
Grassroots: Schools 'expert' has dreadful track record
Economics 101: The eurozone deal and Britain's fiscal crisis
Campaign: Springtime for Hitler at West Midlands Ambulance Service
Campaign: Why the new government should reform benefits
Burning our Money: Non-job of the week
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