New poll: keep the 50p rate but cut VAT

The public want the 50p tax rate to be made permanent, according to a New Statesman/ICD poll.

Barely a week goes by without George Osborne hinting that he will abolish the 50p tax rate in the near future. On Saturday he told the Today programme: "I don't see that as a lasting tax rate for Britain because it's very uncompetitive internationally, and people frankly can move."

However, an exclusive poll by ICD for the New Statesman shows that the public take a different view. Asked if the 50p rate should be made permanent, 34 per cent said yes and 30 per cent said no (see graph). But asked if the starting threshold for the top rate should be reduced from £150,000 to £100,000, something that Ed Balls has suggested remains a possibility, 44 per cent said no and 37 per cent said yes.

A

However, the poll found overwhelming support for Balls's proposal of a temporary cut in VAT. Asked if the government should adopt this policy, 68 per cent said yes and 20 per cent said no (see graph). There is also widespread support for a permanent cut in VAT, with 65 per cent in favour and 18 per cent opposed.

A

Osborne has persistently described the 50p rate as "temporary" and the VAT increase as "permanent". But the public, it seems, takes the reverse view.

This exclusive poll for the New Statesman was carried out by ICD Research, powered by ID Factor, from 6-7 August 2011 and is based on a sample of 1,000 responses

George Eaton is political editor of the New Statesman.

Getty
Show Hide image

How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

0800 7318496