Death and taxes

How will Labour respond to the coalition’s VAT rise?

Two things in life are inevitable, said Benjamin Franklin, death and taxes. The Conservatives campaigned against "Labour's death tax" and against "Labour's jobs tax". But Labour left it to the Lib Dems to campaign against the Tory VAT tax bombshell.

So how will Labour characterise the VAT rise that will bring an end to the New Year sales? They've got a little time to work it out, but it's likely that "death" will play a central role, as the tax rise is felt by everyone and Labour argues that the change is going to kill the recovery.

Ed Balls has a video on his website where he basically says, "I told you so." Last week he urged people to sign up to his campaign to stop the VAT tax rise -- a clever way to capture contact details for party members that he perhaps copied from Ed Miliband's campaign for a living wage and David Miliband's Movement for Change.

Apparently Balls argued that Labour should rule out a VAT increase before the last election, another argument he lost with Gordon Brown and Alistair Darling, who didn't want to box themselves in. Balls has certainly made the most of it and, positioning himself well as an active and effective opponent of the coalition.

But if Balls didn't wanted to rule out a VAT increase, which taxes did he want a Labour government to raise? The official Labour position is that the deficit should be cut using a 2:1 ratio of spending cuts and tax rises -- that's 67 per cent cuts and 33 per cent tax rises.

In opposition, the Tories talked about using an 80:20 ratio and came clean in the Budget about how the 20 per cent of taxes are going to be raised. We have to wait for the spending review, after the conclusion of Labour's leadership election, to find out about the 80 per cent spending cuts.

There is, of course, zero political incentive for an opposition to spell out the alternative tax rises that it would have implemented. However, calculations by Demos show how that the government could have used a 67:33 ratio and raised the necessary £17bn without raising VAT.

Think tanks don't have to get elected, but the package of increases in income tax, CGT on primary residences and taxing carbon is a reasonable, realistic and realpolitik alternative.

Despite being the self-proclaimed "turn-the-page candidate", Diane Abbott has so far had nothing to say about the opportunity to reform and restructure our tax system. If not now, when? Andy Burham says Labour got intoxicated by big business but hasn't developed that into a policy position on tax. What does he think of the cut in corporation tax, for example?

David Miliband's conversion to the Lib Dem mansion tax on houses worth £2m and Ed Miliband's moral argument for keeping the 50p top rate of income tax for good are the only tangible interventions that any of the candidates have made into tax-rise territory. But, if the five are to preserve their own credibility and the integrity of Labour's debate, these are unlikely to be the last.

Richard Darlington is head of the Open Left project at Demos.

Richard Darlington is Head of News at IPPR. Follow him on Twitter @RDarlo.

Getty
Show Hide image

Theresa May’s stage-managed election campaign keeps the public at bay

Jeremy Corbyn’s approach may be chaotic, but at least it’s more authentic.

The worst part about running an election campaign for a politician? Having to meet the general public. Those ordinary folk can be a tricky lot, with their lack of regard for being on-message, and their pesky real-life concerns.

But it looks like Theresa May has decided to avoid this inconvenience altogether during this snap general election campaign, as it turns out her visit to Leeds last night was so stage-managed that she barely had to face the public.

Accusations have been whizzing around online that at a campaign event at the Shine building in Leeds, the Prime Minister spoke to a room full of guests invited by the party, rather than local people or people who work in the building’s office space.

The Telegraph’s Chris Hope tweeted a picture of the room in which May was addressing her audience yesterday evening a little before 7pm. He pointed out that, being in Leeds, she was in “Labour territory”:

But a few locals who spied this picture online claimed that the audience did not look like who you’d expect to see congregated at Shine – a grade II-listed Victorian school that has been renovated into a community project housing office space and meeting rooms.

“Ask why she didn’t meet any of the people at the business who work in that beautiful building. Everyone there was an invite-only Tory,” tweeted Rik Kendell, a Leeds-based developer and designer who says he works in the Shine building. “She didn’t arrive until we’d all left for the day. Everyone in the building past 6pm was invite-only . . . They seemed to seek out the most clinical corner for their PR photos. Such a beautiful building to work in.”

Other tweeters also found the snapshot jarring:

Shine’s founders have pointed out that they didn’t host or invite Theresa May – rather the party hired out the space for a private event: “All visitors pay for meeting space in Shine and we do not seek out, bid for, or otherwise host any political parties,” wrote managing director Dawn O'Keefe. The guestlist was not down to Shine, but to the Tory party.

The audience consisted of journalists and around 150 Tory activists, according to the Guardian. This was instead of employees from the 16 offices housed in the building. I have asked the Conservative Party for clarification of who was in the audience and whether it was invite-only and am awaiting its response.

Jeremy Corbyn accused May of “hiding from the public”, and local Labour MP Richard Burgon commented that, “like a medieval monarch, she simply briefly relocated her travelling court of admirers to town and then moved on without so much as a nod to the people she considers to be her lowly subjects”.

But it doesn’t look like the Tories’ painstaking stage-management is a fool-proof plan. Having uniform audiences of the party faithful on the campaign trail seems to be confusing the Prime Minister somewhat. During a visit to a (rather sparsely populated) factory in Clay Cross, Derbyshire, yesterday, she appeared to forget where exactly on the campaign trail she was:

The management of Corbyn’s campaign has also resulted in gaffes – but for opposite reasons. A slightly more chaotic approach has led to him facing the wrong way, with his back to the cameras.

Corbyn’s blunder is born out of his instinct to address the crowd rather than the cameras – May’s problem is the other way round. Both, however, seem far more comfortable talking to the party faithful, even if they are venturing out of safe seat territory.

Anoosh Chakelian is senior writer at the New Statesman.

0800 7318496