More ink has beene expended on the 50p tax rate in advance of this budget than anything else.
Now suppose Osborne really is playing a very clever game - because he is, without doubt, a clever politician? Just suppose he says come Wednesday "I have reviewed the 50p tax rate and have concluded the time for change is not now."
He can claim he is not a Chancellor for the rich in that case.
And he will also have diverted attention from the fact that this budget will do nothing to increase demand in the economy - which is what is needed. So he will have simply double bluffed a great many people and got away in the process with the callousness of his slaughter of the economy and jobs.
That could be his political strategy. And if it was it would have to be conceded it will have worked - because he'd get all the headlines for not doing something. And that would be smart politics - and dire for the UK.
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Yes, I’ve wondered this. The only other reason I could give for the 50p rate was playing to the right of the party – who would be the only people in the UK who would applaud this – and in particular the right wing back benchers. This would indicate that Cameron or Osborne sees the need for support from the right wing sooner rather than later. I originally had it down as Osborne making a play for the premiership, having some insider info on where the NI bodies are buried, but now I’m not wondering if it’s not Cameron *and* Osborne heading off a play for the premiership from Johnson – which would mean that they’re more worried than they’re letting on about Ken’s prospects for London.
Richard, my view would be that a reduction to 45p was the strongly preferred option but that this was ‘leaked’ deliberately to test the water, with Lib Dems and the public generally. Part of that process was also Clegg’s ‘tycoon tax’ suggestion, which didn’t go down well at all. Consequently, I think they’ll annouce a phased withdrawral, and frame it much as you suggest, making the Tories look ‘in-touch’ (we’re all in this together) and allowing Clegg et al to claim they’re been a brake on Tory policies – yet again (as if!).
If this is the option then there’s been some serious thinking going on at the Treasury to justify this position because as I said in a previous comment, the longer the rate stands the greater the risk that evidence emerges of how effective it is at raising substantial amounts of money.
Of course the other trick that Osborne might be using is to fly a kite on 50p abolition – and then be seen as reasonable for cutting the rate to 45p now ( see today’s Torygraph) and gives Clegg a fig leaf to point to. I could well see a 45p top rate being applied at some level below £150k (as those below that level have more difficulty in avoiding tax) together with the reversal of the withdrawal of personal allowances over £100k.
It needs to remembered that Osborne is a deeply tribal politician who has spent all his life within the Tory political machine.
so you are saying taking away the 50p rate is the wrong thing to do, and now keeping it is just a political stategy – cant please some people !
I’m baffled by your logic
But then I doubt there is any logic in what you say
its your logic not mine. Your blog argues against abolishing the 50p rate due to the amount it raises and the fact that the rich should contribute more, and yet your blog (in your post abovce) also argues that keeping the rate is a political strategy which impliedly you are critiscising
so you can attack the chancellor no matter what he does.
I am saying that it can be both yes
Haven’t you ever heard of something being more than one thing simultaneously?
Or is that possibility beyond your comprehension?