TPA – Cuts In The Name Of Simplicity

More from the Comfortable of Tufton Street

The work of the so-called “2020 Tax Commission” carries on: this joint venture between the Institute Of Directors (IOD) and the so-called Taxpayers’ Alliance (TPA), which claims to be working to propose simplifying the tax system, has today given a taste of what it is really about – cutting benefits and entitlements – while showing a worrying lack of practical knowledge.

Lack of knowledge of the wider world was something the TPA demonstrated superbly recently, when triumphantly announcing the discovery of a “non-job” at a London council. Instead, they showed a total ignorance of how contract and freelance workers operate.

This has translated into today’s missive, authored by usual suspect Rory Meakin, who applauds the suggestion that the state pension might be reformed into a single-payment model, with that one payment level being around £140 per week. Meakin acknowledges that “some will lose out – such as those ... who can receive as much as £200 a week from the various current state pension systems”.

He then continues “While there will be pressure ... to minimise the financial impact on those who might be worse off, the Government must also ensure that any change is fair to taxpayers”. In case anyone missed that sleight of hand, this is playing the fairness card to justify docking a potential 30% of the income of the elderly and vulnerable.

Meakin also uses his piece to suggest that this change is A Good Thing because it may also lead to a simplification of the income tax system, via abolition of National Insurance. Now, while doing Tax and NI has the potential to be niggly once every twelve months, once you’ve set it up, it’s done. Moreover, those of us who just do the one payroll get help in the shape of on-line services from HMRC.

So the idea that people “don’t have the inclination to sit down and work out the exact sums”, as Meakin puts it, suggests he doesn’t have any knowledge of what is entailed: this fits with the earlier demonstration of ignorance when looking at how freelances operate.

And while simplicity in the tax system sounds like A Very Good Thing, the idea that those of us who do our own payroll will lap up the abolition of NI while some pensioners take a 30% benefit hit is a non starter. This is a prime example of TPA nastiness: when Rory Meakin and his fellow non-job holders volunteer for such a pay cut is when I’ll start listening to them.