Alistair and Gordon off the rails
Its not been a good couple of weeks
Politically there might be a reason to change the taxation regime but in policy terms there are very few reasons. Inheritance tax is one of the few entirely justified taxes that you can think of. It tends to promote social mobility, reducing the advantage given by the rich to their children through lucrative transfers of capitol. It is also one of the few taxes on capitol within the UK- most other taxation is either on consumption (VAT) or on income (Income Tax). Inheritance Tax is currently at a historical low level- inequality though is historically high and social mobility is also at a historical low. In policy terms reducing or abolishing inheritance tax isn't really an answer to any sensible question for the UK. Much of the British taxation system is inherently regressive and has moved that way over the last twenty five years, it would have been better to say abolish VAT on some essential goods, than to abolish a tax that only millionaires pay.
Despite that the Chancellor, Alistair Darling, felt he had to respond. He announced that inheritance tax would be reduced and its impact upon married couples would be diluted. The details of the policy are still being chewed over in the press, but the headline was reduction as opposed to the Tory abolition. This is still bad policy. Again Darling has reduced a tax which impacts most on those who can afford to pay tax and not looked at reducing tax on the poorest. Furthermore any change to inheritance tax supports social immobility. Ultimately Darling's policy is a lesser evil than the conservative policy but its still not a good policy.
Cutting taxes for Millionaires!
Not Socialism Mr Brown and definitely
He doesn't have anyone to blame though but himself. After-all Mr Brown could have followed his predecessor Mr Blair's strategy. Mr Blair as soon as the Conservatives announced a policy, would describe it as the next thing to National Socialism. Every MP and minister would go around the country repeating the exact form of words in the same way and pressure groups would be invited to write reports substantiating the charge. Then once the Conservatives had been humiliated, bashed into submission, Mr Blair would walk off with their policy if he thought it was a good election winning (sorry sensible and prudential) policy. He perfected the art, and Mr Brown had to do nothing else but follow the template. But he didn't. The Prime Minister panicked- he decided to follow the winds and grab the policy before the Tories had lost the advantage of first proposing it, now he merely looks stupid.
No wonder he didn't enjoy
Prime Minister's Questions!
It hasn't been a good week for him- especially given the election presentation disaster as well- there is no doubt that this is not enough to destroy Mr Brown's Premiership. He should still be in with a very good chance of winning the next election. But allowing his Chancellor to mishandle the Pre Budget report in such a catastrophic way indicates a weakness that his opponnets will savour!