Tax increases are a real alternative to spending cuts

The public want honesty on tax. So why won't politicians give it to them?



We often say we want our politicians to be honest. Yet the nature of politics has in the past made honesty difficult for progressive politicians.

This is most apparent in debates over tax and spending. In Britain austerity has meant deep spending cuts but, perversely, generous income tax cuts too – as if the two are completely unrelated. When taxes have been increased it has been done stealthily and by tinkering around the edges.

The reluctance on the part of politicians to talk honestly about tax dates back 23 years. When the former Labour leader John Smith decided in 1992 to set out the party’s tax and spending plans in detail – i.e. to be honest with the electorate about what to expect from a Labour government – he was battered by a Tory poster campaign warning voters of a ‘Labour Tax Bombshell’.

An obedient press also toed the disingenuous Tory line: ‘Give more to the tax man with Labour,’ boomed the Daily Mail. ‘Kinnock’s middle-income massacre,’ declared the Express.

Perhaps the press was paying attention to the United States almost a decade earlier. In 1984, Democrat presidential candidate Walter Mondale pledged with unusual candour to raise taxes. “Let’s tell the truth…Mr. Reagan will raise taxes, and so will I. He won’t tell you. I just did.”

Mondale subsequently took a hammering at the polls, largely on the back of Republican attack ads which took his words and span them out of their original context.

The lesson politicians of the left took from these two episodes was that honesty on taxation does not go down well, especially if honesty means admitting to future tax increases.

Yet this long-standing fear of a tax backlash may be out of date. Though the spectre of John Smith may still haunt the Labour party, public opinion appears to have moved on.

To take just one example, according to ComRes polling from last year almost half of the electorate would be willing to pay more income tax if the money went to the NHS. According to polling by YouGov, 42 per cent of the public favour giving public services more money and investment even if it does mean higher taxes. This contrasts with just 14 per cent who wish to prioritise reducing taxation even if it results in public services having less money.

The public also appear to sit to the left of the political consensus in terms of the type of taxes they favour. The coalition has raised the personal tax allowance and increased VAT. The first move offers greater benefit to those higher up the income scale while VAT falls more heavily on low income households.

Yet polling by the Equality Trust from last year suggested that 96 per cent of people believe the tax system should be more progressive than it currently is. In other words, they would prefer things to have moved in the opposite direction to the tax policies of the coalition.

And yet because politicians won’t talk openly about tax, the case for progressive taxation is never made.

The current General Election campaign is a case in point. Because politicians refuse to publicly countenance any increase in income tax, the focus is always on which government departments the next government will slash and by how much.

Not only is this a huge concession to the right (income tax is bad whereas cutting is good) but it also risks leaving politicians open to accusations of broken their promises if taxes do rise (which they will if the next government is to meet bourgeoning NHS and pension costs). Broken promises lead to a further diminishment of public trust in politicians.

In recoiling from the dreaded T word, politicians are behaving like it is 1992. Meanwhile the public have moved on, and I suspect they might like a bit of honesty on tax, even if it hasn’t always worked out well in the past.

James Bloodworth is the editor of Left Foot Forward. Follow him on Twitter

62 Responses to “Tax increases are a real alternative to spending cuts”

  1. TN

    It’s not harassment, it’s about a council doing their job properly.

  2. Guest

    Keep demanding your magical control of other people’s minds. And no, you’re just bad, not quite the same thing.

  3. Guest

    Great, they can flee. The UK will be better off, as they won’t move their businesses and they themselves pay little tax. The progressive taxation he talks about is expecting the rich to pay a higher % of tax than people less well off, which is not true for most of the rich in modern Britain.

    Of course you want no computers in the NHS, no railways, no people except the rich able to afford to be MP’s, etc.

    You’re just after lowering what little tax you pay, of course.

  4. Leon Wolfeson

    Untrue. The top job pay multiples of the public sector are actually stable, whereas in the private sector, the pay multiples keep increasing.

  5. Leon Wolfeson

    You don’t even know what austerity is. Thanks for admitting you’re Bonkers, though!

  6. Colonel hackney

    You sort of make my point. No expenditure can be questioned as wasteful. No amount of tax is too great. And if the rich leave our shores then we’ll just squeeze the next tier down. These appear to be the assumptions underlying your comments.

  7. Guest

    You’re talking nonsense. You *are* squeezing the middle class, as you read your own assumptions into my comments.

  8. Gerschwin

    Thanks for that Leon.

  9. Guest

    Right right. To you wasting cash and doing things blindly is doing their “job properly”.

    No competence allowed.

  10. Anna Willson

    It was interesting to know it! I think that politics used to lie. We pay huge taxes but corruption still on high level in our country. Of course, financial wealth is an urgent issue for each of us but it should not be an obsession. Now we have to work hours and hours to have the best and the leaders of the country which are chosen by us are those who can change the situation. Free time and rest are very important for a human but when you contact Payday Loans Online Service you have to pay it little by little from each paycheck and the cost of it is determined by the market but not by the president.

  11. Vicki Rhodes

    Everybody have to pay tax. At one end it is necessary but other end this is bad because some people are paying more tax on less income and some high society people are paying less tax on high income which is shameful. You should invest your money to cut down the tax.

  12. Vicki Rhodes

    Tax taking is not bad on legal things like income or road tax but now tax is more and more on everything like food medicine which is wrong way for people. Government forces people for paying tax on illegal things. Loan is a good option for tax saving you can go for it. You can get online installment loans direct
    lenders only

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