Working for the tax machine

Never again let politicians claim we don’t want tax cuts. Just the idea of cuts in inheritance tax and stamp duty for first-time buyers was enough for Gordon Brown to bottle a General Election.

Other factors were involved in making Gordon too frit to risk an election. But the single most important policy announcement of the phoney election was Shadow Chancellor George Osbourne’s promise to cut death duty.

It was a stroke of genius and was welcomed everywhere. Even Labour supporters back inheritance tax cuts. Most people also backed the plan to lift the threshold for stamp duty to £250,000 for first-time buyers.

No wonder Gordon and his (Scottish) Chancellor Alastair Darling stole the Conservatives’ clothes and announced a bogus inheritance tax cut of their own.

It’s bogus because it applies to couples and most of those with estates worth £600,000-plus will have already arranged to make the use of two death duty allowances by leaving £300,000 to their heirs on the death of the first partner.

Still, that hasn’t stopped our Scottish leaders from stealing the Conservatives ideas, give them a re-spray and a new number plate and trying to flog them as their own.

Admittedly Darling has taken his revenge by targeting small businesses – whose owners are the very people likely to “benefit” from his inheritance tax “cut”.

Even so, the perception will remain that he has cut a major tax. And we want lower taxes - otherwise why did the polls reverse so dramatically and scare off our big brave Prime Minister?

Most of us are sick of seeing more and more of our money being taken by the Government – especially as much of it is then wasted.

The NHS, for instance, has swallowed up billions of pounds in the past decade. But most of that money has gone on paying the same people to do the same jobs. Unless it’s gone to pay GPs to do less work for more money.

All that money still doesn’t give us hospitals clean enough to protect us from dying as a result of a lack of basic hygiene on the wards.

If it were up to me, the first tax I would axe is the council tax. It is a wicked and pernicious charge which goes up and up without reference to the ability to pay, need or value for money.

Local authorities are merely outposts of Whitehall these days. They carry out the Government’s orders with less and less autonomy.

But if they need extra cash there is, at the moment, only one way to get it – by increasing the money they charge householders.

In the past ten years our household bills – after taking account of inflation – have risen by 53 per cent. That’s not all the Government’s fault.

The gas, electricity and water companies, for instance, have grabbed more than their fair share of our money. But council taxes have doubled.

In the next few years, thanks in part to the Chancellor’s latest spending plans, council taxes will rise by £200 per household for an average home in Band D.

That doesn’t include extra charges to dispose of more than one sack of rubbish a week – likely to cost us an extra £1 a week or so.

We’re being bled dry by the State. There’s plenty of sneaky ways for the Government to slip its hand into our pockets.

Think of all those things the State makes us pay for: holiday flights, passports, driving tests, TV licences, speeding, stamps (even if we can’t get our post delivered), car-parking at hospitals. The list goes on and on.

It’s no wonder finance experts now claim our disposable income – the money we have left after paying the bills, tax and rent – is lower than it was 10 years ago despite the country’s apparent economic prosperity.

In effect, it means that even though we’re getting richer, we are actually getting poorer because more of our money is taken up with paying taxes and boring bills.

When Tony Blair became Prime Minister, we had an average of 34.5 per cent of our money left over after we had paid tax and major household bills. Now it’s 32.6 per cent.

That doesn’t sound much until you do the sums and you realise that it works out that our bills and taxes have increased by £429.40 – virtually the value of a week’s income – every year.

The statistics are frightening. At the moment the average household income is £434.61 a week or £22,600 per year.

After taxes and bills, the amount we have left over in disposable income is, on average, just £7,367.60 a year or £141.68 a week. On that basis the loss of £429.40 a year is a lot of money – a week’s wages for a household.

We already spend half our lives working for the taxman.

An extra week spent earning enough money to keep the council, the BBC, and the Government enjoying above-inflation spending deals is just plain insulting.