News from the New Party

Labour's tax rebellion

Dizzy thinks that the whole furore over Labour's rebellion on the abolition of the 10p income tax band does not show our elected representatives (or at least the Labour ones) in a very good light.  Dizzy has a point.

For a start, while it is fair enough for Labour MPs to complain that they were not elected in order to increase the burden on people on lower incomes, it is equally clear that few people join the Labour Party (let alone seek election as Labour MPs) under the impression that they are joining a low tax party. 

Furthermore, the abolition of the 10p tax band did not come completely out of the blue.  This move has been on the agenda for a while, and Labour MPs were not in open rebellion at the time it was announced.  The politics of the situation has changed.  This is no principled opposition to increasing the tax burden on the poorer sections of society - it is simply another stick with which an increasingly disillusioned and disaffected parliamentary party can beat Gordon Brown.

There is, in reality, no reason why those on the lowest incomes should be paying income tax at all.  We have always supported a much simpler tax system, with a single flat rate, but a high personal tax allowance.  Most of those adversely affected by the disappearance of the 10p tax band, i.e. those on incomes between £5,000 and £18,000, should not be paying tax at all - and those who are should be paying very much less.  Tax reform is, and should be, more for the benefit of the poor than the rich.