Our friends at the so-called Taxpayers’ Alliance are limbering up for the Budget. Although this upcoming test for the Rt Hon Gideon George Oliver Osborne, heir to the Seventeenth Baronet, does not come until March, it is clear that the TPA will be churning out apparently well meaning suggestions from, well, right now, and all the way to Budget day.
And on Budget Suggestion Duty today is the ubiquitous Emma Boon, who is beating the drum for tax cuts. Not just any tax cuts, you understand, but things like the 50p tax rate, which she describes as a “disaster”, despite its having been in existence for less than a year. In her defence, La Boon cites a piece on the Spectator Coffee House blog penned by Speccie editor Fraser Nelson.
Nelson always comes across as being a genial and agreeable bloke, but this does not prevent him from trying to pull a fast one with his analysis. He, in turn, cites the IFS, and tells that they are suggesting the higher tax rate will lose the Exchequer 800 million notes a year. However, the IFS paper he links to [.pdf] takes a much more nuanced line, and pitches no such figure.
Moreover, Nelson’s citing of the TPA figures suggesting that the higher tax rate will actually lose the Exchequer 4.5 billion can be taken with a large pinch of salt – unless they have been independently verified. The legend “TPA calculations” in that group’s various publications means it is otherwise worthless.
Boon’s article has one purpose: to demonise the raising of the income tax rate on the top 1% of earners, and this is for one very good reason: that top 1% is where the TPA gets a substantial amount of its income. Exactly how much is not easy to pinpoint – as ever, the TPA demand transparency of others while refusing to practice it themselves – but those backers want some good PR for their money.
That is why the TPA puts the rich first, and considers everyone else later.