When the last Labour government left office (doesn't that sound great - last Labour government), they left three things for the incoming Conservative administration. A very significant deficit and debt position, a massive £600Bn PFI burden for future generations and a note from the Chief Secretary to the Treasury advising 'there's no money left'. The latter was at least honest but, as can be expected by Labour, the financial position did not inhibit them making wild spending promises in their 2010 General Election manifesto.
They also left something else. Some ticking time-bombs in their last and penultimate budgets. This included the imposition of a 50% top rate of tax. This was supposed to only be for one year - that was the Labour position, when in power, but then it flipped to them wanting it in place for ever. Same old Labour - lies and hypocrisy!
So, some advice for George Osborne as he puts the finishing touches to the pre-election budget that he will deliver, next week.
Lay-out the Conservative agenda regarding taxes and spending and put these in the budget package so that they can be enshrined in law and present whichever party wins the imminent election, with a clear path forward. If the proposals are defeated, maybe because of lack of support from the Lib Dems, then this will provide clear evidence of the tax, tax, tax desires of the opponents.
National Insurance - In order to promote the hiring of under 25s, abolish NI contributions for both employees and employers. All parties make regular speeches talking of the need to reduce youth unemployment, so this should have no opposition - unless it's just lip service that is being paid.
Tax thresholds for OAPs. It is plainly wrong to overtax people who have made provision for their retirement - either through pensions or savings or both. So for all pensioners, increase the tax free allowance to £15,000 for the first £30,000 of income. Then on income over £30,000, reduce the allowance so that for every £1 of income, the allowance is reduced by £2 until the tax free allowance of £12,500 is reached.
Tax Rates for OAPs. Reduce the rate of tax for OAPs to 15% on first £30,000, 30% on next £20,000 and then 40% on anything remaining.
Tax thresholds for other workers. Increase personal allowance to £12,000 for the tax year 2015/2016 and then to £13,250 for 2016/2017 and £14,500 for 2017/2018 and £15,500 for 2018/2019 and £17,000 for tax year 2019/2020.
Tax rates for other workers. Reduce the basic rate of tax to 15% and the 40% rate to 38% and commit to reducing this to 36% in 2016/2017, to 34% in 2017/2018, 20 32% in 2018/2019 and 30% in 2019/2020. Commit to abolishing the 45% rate with effect from the 2017/2018 tax year.
Non-Dom taxes - Increase the Autumn Statement announced charge from £90,000 to £150,000 in 2015/2016 and £200,000 in 2016/2017 and then £300,000 in 2017/2018.
Tax on High value homes owned by companies - Increase the Autumn Statement announced charge from 50% above inflation to 100% in 2015/2016 and 200% above inflation in 2016/2017 and then 300% above inflation in 2017/2018.
Inheritance Tax threshold and rates - Increase the threshold from £325,000 to £500,000 with effect from 2015/2016 and to £650,000 with effect from 2017/2018 and then £750,000 from 2019/2020. Impose a flat rate of 25% on any estate in excess of these thresholds. Exempt all military personnel and Police, Fire and Ambulance personnel that die while on or as a result of being on, active service.
Eliminate the so called Green Taxes - these serve only to put subsidy money into the hands of rich landowners and in the process, impoverish our people.
Then to pay for this, don't spend, don't spend, don't spend.
Reduce all budgets, across the board by 15%, with the sole exception of defence, with further cuts of 3% for the remaining life of the next parliament. For defence, meet the commitment to get this to 2% of GDP, and then retain as this level, from 2016/2017.
The astute and economically competent will recognise that even with 15% cuts the budget won't be balanced. So the ring-fence around NHS and Education expenditure has to be removed and these departments must contribute to the overall reduction in the reach of government. In order to perhaps mitigate the impact on the 'blessed' NHS consider making the reduction in Local Government expenditure 20% instead of 15%. That will be bad news for those councils that want to continue their outreach programmes for LGBT unemployed or single mothers but the whole thrust of the budget and Conservative policy must be to recognise that working people must be able to retain more of their money rather than it being taking by the government.
Abolish, completely and utterly, the Department for the Environment and Climate Change.
Also to assist the NHS, ensure that it is clear that the government will not stand as the lender of last resort behind any NHS Trust that, for example was to declare itself insolvent and unable to meet its onerous PFI payments but that were such to occur, the government would immediately intervene to establish an alternative NHS Trust which would not accept the PFI liabilities of its predecessor organisation.
Finally bring MPs back in line with the people that they represent by making the expenses that they receive, taxable, just as they are for all other 'hard-working people'. I have never heard an explanation of why MPs should be treated differently to ordinary people! No doubt, being taken down from the lofty levels to which they have elevated themselves, this will upset some MPs but all MPs must first and foremost recognise that they are servants of the people not their rulers.
They also left something else. Some ticking time-bombs in their last and penultimate budgets. This included the imposition of a 50% top rate of tax. This was supposed to only be for one year - that was the Labour position, when in power, but then it flipped to them wanting it in place for ever. Same old Labour - lies and hypocrisy!
So, some advice for George Osborne as he puts the finishing touches to the pre-election budget that he will deliver, next week.
Lay-out the Conservative agenda regarding taxes and spending and put these in the budget package so that they can be enshrined in law and present whichever party wins the imminent election, with a clear path forward. If the proposals are defeated, maybe because of lack of support from the Lib Dems, then this will provide clear evidence of the tax, tax, tax desires of the opponents.
National Insurance - In order to promote the hiring of under 25s, abolish NI contributions for both employees and employers. All parties make regular speeches talking of the need to reduce youth unemployment, so this should have no opposition - unless it's just lip service that is being paid.
Tax thresholds for OAPs. It is plainly wrong to overtax people who have made provision for their retirement - either through pensions or savings or both. So for all pensioners, increase the tax free allowance to £15,000 for the first £30,000 of income. Then on income over £30,000, reduce the allowance so that for every £1 of income, the allowance is reduced by £2 until the tax free allowance of £12,500 is reached.
Tax Rates for OAPs. Reduce the rate of tax for OAPs to 15% on first £30,000, 30% on next £20,000 and then 40% on anything remaining.
Tax thresholds for other workers. Increase personal allowance to £12,000 for the tax year 2015/2016 and then to £13,250 for 2016/2017 and £14,500 for 2017/2018 and £15,500 for 2018/2019 and £17,000 for tax year 2019/2020.
Tax rates for other workers. Reduce the basic rate of tax to 15% and the 40% rate to 38% and commit to reducing this to 36% in 2016/2017, to 34% in 2017/2018, 20 32% in 2018/2019 and 30% in 2019/2020. Commit to abolishing the 45% rate with effect from the 2017/2018 tax year.
Non-Dom taxes - Increase the Autumn Statement announced charge from £90,000 to £150,000 in 2015/2016 and £200,000 in 2016/2017 and then £300,000 in 2017/2018.
Tax on High value homes owned by companies - Increase the Autumn Statement announced charge from 50% above inflation to 100% in 2015/2016 and 200% above inflation in 2016/2017 and then 300% above inflation in 2017/2018.
Inheritance Tax threshold and rates - Increase the threshold from £325,000 to £500,000 with effect from 2015/2016 and to £650,000 with effect from 2017/2018 and then £750,000 from 2019/2020. Impose a flat rate of 25% on any estate in excess of these thresholds. Exempt all military personnel and Police, Fire and Ambulance personnel that die while on or as a result of being on, active service.
Eliminate the so called Green Taxes - these serve only to put subsidy money into the hands of rich landowners and in the process, impoverish our people.
Then to pay for this, don't spend, don't spend, don't spend.
Reduce all budgets, across the board by 15%, with the sole exception of defence, with further cuts of 3% for the remaining life of the next parliament. For defence, meet the commitment to get this to 2% of GDP, and then retain as this level, from 2016/2017.
The astute and economically competent will recognise that even with 15% cuts the budget won't be balanced. So the ring-fence around NHS and Education expenditure has to be removed and these departments must contribute to the overall reduction in the reach of government. In order to perhaps mitigate the impact on the 'blessed' NHS consider making the reduction in Local Government expenditure 20% instead of 15%. That will be bad news for those councils that want to continue their outreach programmes for LGBT unemployed or single mothers but the whole thrust of the budget and Conservative policy must be to recognise that working people must be able to retain more of their money rather than it being taking by the government.
Abolish, completely and utterly, the Department for the Environment and Climate Change.
Also to assist the NHS, ensure that it is clear that the government will not stand as the lender of last resort behind any NHS Trust that, for example was to declare itself insolvent and unable to meet its onerous PFI payments but that were such to occur, the government would immediately intervene to establish an alternative NHS Trust which would not accept the PFI liabilities of its predecessor organisation.
Finally bring MPs back in line with the people that they represent by making the expenses that they receive, taxable, just as they are for all other 'hard-working people'. I have never heard an explanation of why MPs should be treated differently to ordinary people! No doubt, being taken down from the lofty levels to which they have elevated themselves, this will upset some MPs but all MPs must first and foremost recognise that they are servants of the people not their rulers.
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