My blogging has - if you are observant - become ever more sparse...although this is my second posting this month...so a definite improvement there. However, I have been regularly contributing to DestiNation, the online magazine that Julie started last year.
The January issue is now up and I have offered an article on taxation if anyone is interested.
Showing posts with label income tax. Show all posts
Showing posts with label income tax. Show all posts
Monday, 12 January 2009
Wednesday, 21 March 2007
Cut the spin on Brown's tax "cut"
I have been quick to criticise elements of the media for some of their coverage of the SNP of late, so I should give credit where credit is due. The response of the vast majority of the media to Gordon Brown's budget today (widely suspected to be his last) really hit the nail on the head when it came to his supposed 2p cut to the basic rate of income tax. They have spotted this for the piece of spin that it really is.
As with much in life, the Devil is in the detail with Chancellor Broon's alterations to the level of taxation.
What may at first seem a straightforward tax cut aimed at low income and lower middle income families was anything but. What Gordon didn't say in his speech to the House of Commons today was that not only was he dropping the basic rate of tax from 22% to 20% but he was simultaneously ditching the 10% starting rate as well.
This means that where once we were paying 10% on our income between roughly the level of £6,000 to £8,000 (our first £6k was and remains tax free) we will now pay 20% on that income. This will of course be offset for those on a decent wage, as the reduced level of taxation they pay on the rest of their income will make up for this.
However, for those in part time employment or those on minimum wage, today's change to the levels of taxation will make for a worrying announcement. Far from seeing a tax cut, these people will see a tax hike. Once this new tax regime is instituted they will actually be paying more in income tax.
So much for Labour being the party of hard working families. These low paid families will see less money in their pockets to fund a cut in taxation that those earning more will benefit from. This is redistribution working in the wrong direction.
So for those in the Labour Party who expect to see a return to more traditional Labour values under a Brown premiership I have a message. Wake up and take a reality check. Brown has no more intention of returning to these values than Tony Blair ever did.
As with much in life, the Devil is in the detail with Chancellor Broon's alterations to the level of taxation.
What may at first seem a straightforward tax cut aimed at low income and lower middle income families was anything but. What Gordon didn't say in his speech to the House of Commons today was that not only was he dropping the basic rate of tax from 22% to 20% but he was simultaneously ditching the 10% starting rate as well.
This means that where once we were paying 10% on our income between roughly the level of £6,000 to £8,000 (our first £6k was and remains tax free) we will now pay 20% on that income. This will of course be offset for those on a decent wage, as the reduced level of taxation they pay on the rest of their income will make up for this.
However, for those in part time employment or those on minimum wage, today's change to the levels of taxation will make for a worrying announcement. Far from seeing a tax cut, these people will see a tax hike. Once this new tax regime is instituted they will actually be paying more in income tax.
So much for Labour being the party of hard working families. These low paid families will see less money in their pockets to fund a cut in taxation that those earning more will benefit from. This is redistribution working in the wrong direction.
So for those in the Labour Party who expect to see a return to more traditional Labour values under a Brown premiership I have a message. Wake up and take a reality check. Brown has no more intention of returning to these values than Tony Blair ever did.
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