If Nick Clegg wants to talk tax fairness I'm delighted, and welcome it. I'm wholly non-partisan in my approach to those who want to do so, but that does not mean I do not note from whence they come to the debate. Nick Clegg comes from an unfortunate place.
He is Deputy Prime Minister. He is responsible for the actions of this government. He is responsible for:
- Increasing VAT to 20%, it's highest ever level. This is a deeply regressive tax.
- Cut the top rate of tax from 50% to 45% - a deeply regressive tax measure as it saved the highest earners over £6 billion a year in my estimate if the impact of income shifting is ignored;
- Cut the top rate of corporation tax for big business by 7% whilst doing nothing for small business;
- Increased the personal allowance to supposedly take people out of tax and yet cut their beenfits to pay for it; a deeply regressive move. The allowance increase did not help the poorest; it helped those on middle incomes most (I'm not saying they didn't need help, but Clegg's claim is wrong);
- Introduced territorial corporation tax to encourage UK companies to shift their profits into tax havens;
- Did not align capital gains tax and income tax rates;
- Has introduced a general anti-abuse rule that will not tackle most tax avoidance;, by design;
- Cut the staff of HMRC by about 20,000 to ensure that tax cannot be collected.
I could go on. But my point is this: talk tax fairness by all means, but acknowledge what you have got wrong and tackle it as well. Otherwise talk is cheap.
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