Useless tax policy #1 and #2
The Conservative Party are heading for a hat trick of tax policies that completely miss the point.
At the end of last week, George Osborne wrote to the Chancellor declaring that he would cut corporation tax from 28% to 25% to stop companies leaving the UK. However, as the tax expert and obsessive blogger Richard Murphy keeps pointing out, this small handful of companies are not leaving because of the tax rate but because of other planned changes to the way foreign profits are taxed. Richard has recently provided a detailed post explaining all this.
And today we learn that the Conservative Party will announce that the £1 million threshold on inheritance tax promised at their 2007 conference will be effectively doubled by allowing the amount to be transferred to spouses. Who this helps other than extremely wealthy people is anyone’s guess. As an excellent Fabian Society pamphlet on the subject pointed out, inheritance tax only affects the wealthiest 6% of the population and is an important way of challenging in-built and unearned privilege. So, once again, if this is the Party that is now committed to fairness, it has missed the point.
I’ll keep an eye out for useless tax policy #3. It must be on the way.