Climb out of the playpen

Last week’s ‘swansong’ Budget, as someone called it, seemed to have no guiding principle other than cynical political tinkering.

Corporate tax went down, except it didn’t really because the allowances changed. That might stop accounting firms from putting out press releases saying the UK’s tax rate is higher than other comparable countries, but it won’t mean people move here for tax reasons. The decisions on tax competitiveness have (rightly, I happen to think) been ducked.

There were a host of other changes, but little, apart from the Manninen moves, on the complex international tax issues that caused a fuss at pre-Budget report time.

But the personal tax changes were most perplexing, and actually quite depressing.

Gordon dropped the basic tax rate by 2p, probably good for most Accountancy Age readers. And he paid for it by getting rid of the 10% band, something that most of you won’t especially worry about, either. Since its major impact is to hit people earning less than £17,000.

But it’s something that Gordon should worry about. Or rather, it’s something that he claims to worry about.

The chancellor is the kind of politician who says that politics is about ideas, about changing the world for the better, and not about personalities or childish politicking. But his Budget is exactly what that is about. It is a regressive budget from the most moralistically progressive politician we have.

The Tories copped some flak for their response to the Budget. But the suggestion that this was not a tax cut but a tax con is spot on. More than that, it was cynical and hypocritical. Can’t we expect more from politicians?

Alex Hawkes is news editor on Accountancy Age