No decision on 50p tax this year, says Downing Street

Official figures show that the tax could raise nearly £13bn over five years, as PM says there will b

The 50p tax rate continues to cause tension within government, as Downing Street made it clear last night that there would be no decision on scrapping the rate this year.

A spokesman for the Prime Minister said it would be difficult to make a decision before 2012, when we will have the results of a review into the income tax rate for those earning over £150,000. Realistically, it would not be politically expedient to make a decision before 2013, when the public sector pay freeze ends. The tax is too charged with political symbolism about fairness to be scrapped without being seen to provide relief elsewhere, too.

Although Osborne has expressed doubt over how much money the tax raises, official figures released by the Treasury show that the 50p rate would raise £12.6bn over the next five years, a calculation which incorporates the chance that top earners might leave the country to avoid the tax. This would mean that by 2015-16, the 50p rate would raise £3.2bn more than if the top rate was 40p. It provides ammunition with those who disagree with a letter sent by 20 economist to the Financial Times, calling for the rate to be scrapped early.

Yet debate around the controversial tax rate rolls on. In an interview with the New Statesman's political correspondent, Rafael Behr, Danny Alexander makes clear his priorities on taxation. Here is an extract from the interview (available in this week's magazine, currently on the newsstands):

From the Treasury perspective, the main Lib Dem contribution to government has been the plan to raise the income-tax threshold to £10,000 by the end of the parliament. Alexander is very attached to this policy as a way of compensating people on low incomes for the cuts. "I think it's a direction that we will want to push further," he says. How much further? "I don't see why, in the next parliament, we shouldn't be trying to get to a situation where people in a full-time job on the minimum wage are paying no income tax at all. That, to me, is a higher priority than reducing the overall tax burden on the wealthy." I take this to mean that he rejects the aim, supported by many Conservatives and endorsed by a group of 20 economists in a public letter to the Financial Times, of abandoning the 50p top rate of income tax. "At a time when the whole country is facing serious financial challenges, the priority needs to be people on low and middle incomes."

Nick Clegg and Vince Cable have both made it clear that they have no ideological objection to scrapping the tax, as long as it is replaced by another measure to tax the rich. One measure they are looking at is a property tax. Tim Farron, the president of the Liberal Democrats, was more unequivocal:

What an outrage, in tough times like this, if the government was to give a tax cut to those who earn more than £150,000 a year and not give any more to those people who are struggling to get by, many of whom are paying the price for the profligacy and recklessness of very wealthy people that got us into this mess in the first place.

Meanwhile, Conservatives continue to be frustrated with the fact that the tax rate has not been dropped. Eric Pickles, the Communities Secretary, conceded that the tax could be dropped only "when the time is right", but added:

I think there is a strong and reasonable case to say, 'Come on, this is not actually contributing very much'. On balance, it's probably doing more damage than it's doing good.

This latest debate was triggered after 20 economists wrote to the FT to urge George Osborne to abandon the top rate in order to stimulate the faltering economy. As we at the Staggers have argued repeatedly, reversing their hike in VAT would do far more to stimulate the economy.

 

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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The dog at the end of the lead may be small, but in fact what I’m walking is a hound of love

There is a new, hairy face in the Hovel.

There is a new, hairy face in the Hovel. I seem to have become a temporary co-owner of an enthusiastic Chorkie. A Chorkie, in case you’re not quite up to speed with your canine crossbreeds, is a mixture of a chihuahua and a Yorkshire Terrier, and while my friend K— busies herself elsewhere I am looking after this hound.

This falls squarely into the category of Things I Never Thought I’d Do. I’m a cat person, taking my cue from their idleness, cruelty and beauty. Dogs, with their loyalty, their enthusiasm and their barking, are all a little too much for me, even after the first drink of the day. But the dog is here, and I am in loco parentis, and it is up to me to make sure that she is looked after and entertained, and that there is no repetition of the unfortunate accident that occurred outside my housemate’s room, and which needed several tissues and a little poo baggie to make good.

As it is, the dog thinks I am the bee’s knees. To give you an idea of how beeskneesian it finds me, it is licking my feet as I write. “All right,” I feel like saying to her, “you don’t have to go that far.”

But it’s quite nice to be worshipped like this, I have decided. She has also fallen in love with the Hovel, and literally writhes with delight at the stinky cushions on the sofa. Named after Trude Fleischmann, the lesbian erotic photographer of the Twenties, Thirties and Forties, she has decided, with admirable open-mindedness, that I am the Leader of the Pack. When I take the lead, K— gets a little vexed.

“She’s walking on a loose lead, with you,” K— says. “She never does that when I’m walking her.” I don’t even know what that means, until I have a think and work it out.

“She’s also walking to heel with you,” K— adds, and once again I have to join a couple of mental dots before the mists part. It would appear that when it comes to dogs, I have a natural competence and authority, qualities I had never, not even in my most deranged flights of self-love, considered myself to possess in any measurable quantity at all.

And golly, does having a dog change the relationship the British urban flâneur has with the rest of society. The British, especially those living south of Watford, and above all those in London, do not recognise other people’s existence unless they want to buy something off them or stop them standing on the left of the sodding escalator, you idiot. This all changes when you have a dog with you. You are now fair game for any dog-fancier to come up to you and ask the most personal questions about the dog’s history and genealogy. They don’t even have to have a dog of their own; but if you do, you are obliged by law to stop and exchange dog facts.

My knowledge of dog facts is scant, extending not much further beyond them having a leg at each corner and chasing squirrels, so I leave the talking to K—, who, being a friendly sort who could probably talk dog all day long if pressed, is quite happy to do that. I look meanwhile in a kind of blank wonder at whichever brand of dog we’ve just encountered, and marvel not only at the incredible diversity of dog that abounds in the world, but at a realisation that had hitherto escaped me: almost half of London seems to have one.

And here’s the really interesting thing. When I have the leash, the city looks at me another way. And, specifically, the young women of the city. Having reached the age when one ceases to be visible to any member of the opposite sex under 30, I find, all of a sudden, that I exist again. Women of improbable beauty look at Trude, who looks far more Yorkie than chihuahua, apart from when she does that thing with the ears, and then look at me, and smile unguardedly and unironically, signalling to me that they have decided I am a Good Thing and would, were their schedules not preventing them, like to chat and get to know me and the dog a bit better.

I wonder at first if I am imagining this. I mention it to K—.

“Oh yes,” she says, “it’s a thing. My friend P-J regularly borrows her when he wants to get laid. He reckons he’s had about 12 shags thanks to her in the last six months. The problems only arise when they come back again and notice the dog isn’t there.”

I do the maths. Twelve in six months! That’s one a fortnight. An idea begins to form in my mind. I suppose you don’t have to be a rocket scientist to work out what it is. But no. I couldn’t. Could I?

Nicholas Lezard is a literary critic for the Guardian and also writes for the Independent. He writes the Down and Out in London column for the New Statesman.

This article first appeared in the 28 April 2016 issue of the New Statesman, The new fascism