TaxPersonal TaxPortillo to announce Tory tax watchdog

Portillo to announce Tory tax watchdog

Shadow chancellor Michael Portillo is today expected to disclose the Conservative Party's plan for an independent committee of economic advisers to direct fiscal tax and spending policies.

The proposal, to be made in a speech to the London School of Business, is seen as an important element of the Tories’ economic policy in the run-up to the spring elections.

Portillo’s plans would limit the power and control of the chancellor over fiscal policy, and would fly-in-the-face of chancellor Gordon Brown’s strategy of ‘self-imposed’ tax and public spending regulations, the Financial Times reported today.

Brown has followed a policy of strong growth in public spending, a strategy criticised by the Bank of England and independent economists, who believe an increase in public sector spending will mean private spending and investment growth must slow down to keep inflation in check.

According to the FT, Portillo is expected to emphasise ‘more rigorous disciplines’ to meet global economic conditions. To do to this, the independence of the Bank of England from the exchequer’s office will be strengthened, and the selection of members to the Bank’s monetary policy committee is to be more transparent.

The Tories will also announce an enhanced role for the Treasury’s council of economic advisers, similar in responsibility to the Bank of England’s Monetary Policy Committee, which rules on interest rates. However, unlike the MPC, the Treasury’s council would not be a decision-making body, but would only monitor and advise the chancellor on policy.

Some economists criticised the Tory proposal calling it an ‘inappropriate economic policy mix’ – an inflexible monetary policy contrasted against a loose fiscal policy.

Portillo is expected to provide evidence of a growing antagonism to paying tax, and reiterate the Tories’ anti-euro stance.

Last week, the Conservative Party promised to cut public spending and give £8bn back to taxpayers.

Links

Conservative Party business policy

Portillo begins new job by pledging to keep in place Labour reforms

Related Articles

Rent-a-room relief – the survey says…

Personal Tax Rent-a-room relief – the survey says…

1m Helen Thornley, ATT Technical Officer
What should the OTS prioritise in its review of inheritance tax?

Personal Tax What should the OTS prioritise in its review of inheritance tax?

3m Alia Shoaib, Reporter
LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

4m Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

5m Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

6m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

6m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

8m Alia Shoaib, Reporter
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

9m Emma Smith, Managing Editor