Labour’s official facebook page just shared the following devastating ‘fact’:
As the contorted wording perhaps suggests, Labour’s social media spinners are not being entirely straightforward. As much as they are trying to give the impression that taxes for the rich have been cut, they can’t because they haven’t been. The policies the Conservatives were originally proposing, might indeed have done that. However, the policies the Coalition have enacted have been rather different. As Stephen Tall explains:
Many…still attack the Lib Dems for being part of a Coalition government that cut the top-rate of tax from 50p to 45p for those earning more than £150k. Yet they ignore the fact that, in the same 2012 budget, wealth taxes were increased: stamp duty was increased to 7% for multi-million pound homes, and there was a new 15% tax on companies buying property over £2m.
The net result of the Coalition’s tax and benefit changes has seen the income of the richest 10% fall most sharply since 2010, as this IFS graph shows:
The other key point to remember is that for all the debate around this policy change, the best guess is that it, probably reduced the government’s revenue by around £100 million. Which in the context of the overall government budget is not a great deal. It would, for example, cover just a fraction of the cost of reversing the bedroom tax.
Labour are not wrong on this issue: the tax probably should be reversed. However, their focus on this side issue does feel rather like an admission that they’ve failed to devise anything more than tweaks to the Coalition’s policies.