In yesterday’s budget George Osborne announced that the personal income tax allowance would be raised to £10,000 from next year, earlier than 2015 as originally planned. Superficially taking people out of income tax does sound like a tantalising prospect – poorer people will have more money in their pockets, will they not? There are two major problems with this.
When we assess the Osborne borrowing record, let’s be clear that it’s not just headline borrowing that is much higher than he promised a couple of years ago. Buried in today’s budget is also the hidden borrowing of future pension promises where he’s already spent some of the money designed to pay for them.
What this Budget has done is entrench this chancellor’s misguided policy and has squandered the opportunity of the last three years to significantly invest in UK infrastructure to make the country fit to compete in the 21st century.
As you can see from the graph, the idea that the £10 thousand pound personal allowance is about anything resembling fairness is a nonsense. As the graph below shows, those who benefit most from the policy are those on thetest
Left Foot Forward will be covering George Osborne’s budget live.
Budget leaked by Evening Standard
Housing development is a cost-effective way out of recession that doesn’t suck in imports but tackles a number of problems.
Left Foot Forward has looked at a few things we already know will be in today’s Budget as well as at those things which stand half a chance of making it.
The defining societal trend in the UK over the past 30 years has been the growth in inequality, with an ever higher share of the national income captured by a wealthy elite, while the wages of ordinary working people stagnate. Redressing the balance need not come at a cost to enterprise.
Supporters of international development should watch this week’s budget announcement very carefully. As is so often the case, what is missing from the chancellor’s announcement could tell us as much as what is included about where the Coalition’s priorities lie.
