Labour Left is Ashamed of Ken

The self-appointed moral arbiter of the left, Mehdi Hasan, has broken cover in the Staggers and ruined Ken’s morning:

The big problem for Livingstone is that he has been a vocal supporter of UK Uncut, which campaigns against not just (illegal) tax evasion but also (legal) tax avoidance – by Vodafone, Topshop and other big companies. “These rich bastards just don’t get it,” Livingstone wrote in 2009. “No one should be allowed to vote in a British election, let alone sit in our parliament, unless they are paying their full share of tax.” The former London mayor called for everyone to “pay tax at the same rate on their earnings and all other income”.

The word “hypocrite” is being whispered – and not just by the usual suspects on the right. 

The simple truth is this: you cannot run as the populist, banker-bashing candidate, the one who backs higher taxes on “rich bastards”, if you’re quietly channelling hundreds of thousands of pounds of your own earnings into a company jointly owned with your wife. You just can’t.

Hasan recommends that Ken gets his chequebook out and pops down to the HMRC with a camera crew. What are you afraid of Ken?

Exclusive: Gov Response to Ken Slams Company Tax

Ken wrote to the Prime Minister asking for a change in the law so that the Mayor of London could only have one job. The reply fell under the purview of Grant Shapps:

Dear Ken,

Thank you for your letter of 27 February 2012 to the Prime Minister; he has asked me to reply on his behalf as the Greater London Authority Act is the responsibility of the Department for Communities and Local Government.

I have considered your request carefully, but my department has no plans to amend legislation in this way.

I believe the electorate are best placed to make judgments on whether elected representatives are able to pursue other interests in their spare time. Indeed, it would be quite illiberal to pass laws restricting and regulating what individuals can do in their evenings and on weekends.

Indeed, the effect of your proposed regulations would have meant you were unable to serve as Mayor of London when you were first elected in 2000, since you were a Member of Parliament, had paid columns in The Independent and the Evening Standard, had a book contract with Victor Gollancz, and received five-figure sums from after-dinner speaking agencies. Subsequently, during the period you were Mayor, you had a continuing commercial interest in Localaction Ltd, receiving payments for television, radio and writing.

In this context, I view your new-found interest in this issue to be wholly inconsistent and a further argument against ill-thought-out regulation. Calling for regulation on ‘full-time mayors’ whilst running a part-time company is as consistent as calling for a clampdown on tax dodging whilst using a company to avoid paying income tax.

Obviously, outside interests must open and transparent – and the Coalition Government has taken steps through the Localism Act 2011 and the new local government Transparency Code to entrench such transparency in law. I would note that the Greater London Authority has been at the forefront of promoting the transparency agenda in the last four years, such as being the first local government body to start publishing its spending online.

Rt Hon Grant Shapps MP
Minister of State for Housing and Local Government

Well Guido laughed…

The Former Coalition Ministers Club

What becomes of disgraced coalition cabinet members after they are forced to resign? Well if this morning is anything to go by it seems they perform a pincer movement on George Osborne, calling for tax cuts.

If Huhne weighed in it would be a full house…

While there is an irony about Fox complaining it is too hard to sack people, he makes some good points in the FT:

The budget must confidently assert that capitalism works. But it doesn’t work if failure is rewarded as if it was success. …individual risk and effort is not rewarded when the UK government share of GDP has risen from 38 per cent in 1999 to 51 per cent in 2011, the effective top rate of tax is over 50 per cent, and CPI inflation for the last five years has averaged 3.5 per cent.To restore Britain’s competitiveness we must begin by deregulating the labour market. Political objections must be overridden.

In the GuardianDavid Laws follows up Monday’s Newsnight outing with a welcome call to speed up taking the poorest out of tax. He wants to put up taxes though to fund it. Hmm…

A cynical person might think this must be coordinated, but Guido isn’t so sure. There’s no doubt that Laws’ interventions are sanctioned by his leader, though Guido doubts the same can be said be said for Fox. Steve Hilton will like it, but No.11 sources seem rather relaxed about the whole affair this morning…

Clegg’s Progressive £10,000 Threshold Hike
Benefits Low Income Earners Most

A lot of chaff is being thrown up about the £10,000 tax threshold hike being pushed by Clegg this morning. Matthew Sinclair over at the Taxpayers’ Alliance has sent this chart proving the point Guido has been making all day. Those on low earnings benefit proportionately the most.

Those on lower earnings, e.g. the second decile (£10,853 according to ONS data) will see their post-tax earnings rise by 4.7%, those in the highest decile will see their post tax earnings rise by just 1.1%. Now some policy wonks on the left complain that middle income earners will see their post tax income rise by some 2% and that this is “a waste of money”. The squeezed middle-classes need some help as well, this is a good thing, not a flaw. The hike shouldn’t be paid for by once again shifting the higher rate threshold either. The coalition parties should stop piling on the pressure on the very demographic that voted them into office to cut taxes…

Tax Transparency Bill Gets Second Reading

Ben Gummer’s tax transparency 10 Minute Rule Bill was just passed in the House and will come back for a second reading in March. Chris Bryant stood  up to oppose it on the grounds that “there are better things we could be doing”, and raised various technicalities, but to no avail. It makes you wonder what he doesn’t want the voters to know? The UK is a step closer having an itemised breakdown of how our money is spent. 

A Taxing Question for Labour

The fact that polling shows that 69% of voters support the benefit cap, leaves Guido wondering about the other 31%. If taxpayers knew how much they were personally contributing to these handouts, you would imagine that 31% figure would be a lot lower. Enter backbench Tory MP Ben Gummer, whose plan to print a break down of taxes on a statement sent to every taxpayer, every year, has got a lot of attention this morning. The Sun are liking it and the Telegraph claim:

“If you were to discover, for instance, that £4,000 of the £10,000 you have paid in tax and NICs for the year went on welfare, it might put the argument over capping benefits into a different context.”

A sample PDF of the document is here and apparently the Treasury are listening. There is a 10 Minute Rule Bill issue tomorrow, and Guido is scratching his head to see how the Labour can justifiably oppose the idea. Any additional cost would be minimal given that statements, minus the breakdown, are already sent out. Hard to argue that people should be kept in the dark about their own money…

Toffs Taxing the Poor More

Minimum alcohol pricing won’t affect champagne drinkers, it will hit those on lower incomes. Again.

Regressive taxes aren’t just about forcing up the price of supermarket booze, it was putting up VAT – a mistake that boosted inflation which was already above target and hit consumer spending when it was already weak. Unquestionably that was a regressive tax. Even the usually austerity friendly IMF cautioned against the VAT hike.

The squeezed middle aren’t spared either. Air Passenger Duty means that a family of four flying to America for their annual holiday can pay up to £587 in taxes. The Fawkes family fly back and forth to Ireland regularly spending more on air taxes than on air tickets. UK subjects pay more in air taxes than all the rest of the EU’s citizens – combined. It won’t bother the Chancellor on his £10,000 skiing holiday weeks, but those of us in the private sector, not on benefits, reckon he could do more to cut spending and the tax burden. It is called a growth strategy…

Prime Minister Cameron proposes a retaliatory tax…

‘I’m sometimes tempted to ask the French if they would like a cheese tax’

Red Ed is Back, Chuka Under Attack, Occupiers Smoking Crack

Red Ed has made an overture to the protesters at St Paul’s, four weeks late to the prom. Some of his advisers still rooted in the reality based community have been struggling to stop Ed leaping over this latest electoral […]

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Osborne’s Corporatism Isn’t Fiscal Conservativism

There is often more truth in satire than news reporting and yesterday gave us an amusing example. The Chancellor’s vague plan for the Treasury to buy small firm’s corporate bonds was reported on by the Daily Mash thus:

Osborne’s offer

[…]

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Ed Balls claims unconvincingly…

“My instinct is that you should always try to reduce every tax if you can…”[…]

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Left-Wing Think-Tank Wants Labour to Tax the Poor More

The best policy idea to come out of LibDem conference was Danny Alexander’s call for tax thresholds to be raised to £12,500, effectively taking minimum wage earners out of income tax. Reversing Gordon Brown’s complicated tax – the – poor […]

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Quote of the Day

Mary Creagh’s coded attack on Ed Miliband…

‘I want the country to be united behind a single vision, we aren’t going to do it by sort of having a Rubik’s Cube approach to politics’. 

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