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Sunday 20 May 2012

TPA – 2020 Tax Commission Speaks (1)

Tomorrow, the 2020 Tax Commission, a joint effort between the Institute of Directors (IoD) and the so-called Taxpayers’ Alliance (TPA), chaired by TPA stooge Allister Heath, will present its final report. This is, as of now, embargoed. But Zelo Street readers can see much of what it will contain today, what its implementation would really mean for ordinary taxpayers, and who would benefit.

More guff from Tufton Street

And there is one new item in that report that has not previously been trailed: the optimum size for the public sector. This is a remarkably wrong-headed concept: forget what you have been told about those old-fashioned ideas such as public service, helping the less fortunate, and infrastructure provision. If that falls outside the parameters of the TPA’s model, it won’t be allowed to happen.

Exactly how this optimally sized public sector will be presented is not known, but what is known is that it will be significantly smaller than at present, thus ensuring tens of thousands are thrown out of work along with a sudden decline in economic activity, that it will mean the kind of people who keep the TPA in the style to which they have become accustomed will benefit, and it will be called “fair”.

Yes, “fairness” will be stressed at all times, particularly when urging abolition of the minimum wage, at least for those under 25. This was signposted by the TPA’s non-job holder Rory Meakin in January last year, soon after the Commission was set up, along with another tax cut they will be recommending, in Corporation Tax. This will be held to be essential in helping competitiveness.

What Meakin also let slip was that the Commission will be urging tax simplification, and this will be one of their “big ideas”, that of bringing in a “flat tax”. This will also be cited as “fair”, and by the happiest of coincidences, those who will benefit the most from it will be those who bankroll the TPA. In support of the idea will be tales of distressed rich people being otherwise forced to flee to Zug, or Monaco.

Also on the Commission’s agenda will be simplification of state pension entitlements, with Meakin again signposting a willingness to see some of the elderly have as much as 30% removed from their income. This, too, will be called “fair”. Added to this cut will be a restatement of the previous TPA urging that the poverty line be lowered, which will be called both “affordable” as well as “fair”.

There will be much talk of “ordinary hard-working taxpayers”, though these will not be employed in the public sector, where all are fair game for ritual demonisation. Nor will they be disabled and qualifying for the Motability scheme, because this, according to the TPA, includes “cheats”. Nor will they work for any of the charity or environmental groups that the TPA has been routinely smearing.

So what would happen if the report were implemented? That comes next.

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