Labour steps up its 50p tax attack with new "Tory Millionaire's Day" campaign

Ahead of the abolition of the 50p tax rate on 6 April, Labour looks again to paint the Tories as the party of the rich.

When I recently interviewed Conservative MP Robert Halfon, who first called for the reintroduction of the 10p tax rate, he lamented how Labour's "brilliant" campaign against the abolition of the 50p rate had defined the Tories as "a party only interested in cutting taxes for millionaires". More than any other single measure, the move retoxified the Conservative brand and confirmed the Tories' status as "the party of rich". Every time that David Cameron defends an unpopular tax rise or spending cut, Ed Miliband is able to remind voters that he has simultaneously chosen to reduce taxes by an average of £107,500 for 8,000 income-millionaires.  

With just over a month to go until the tax cut is introduced on 6 April, Labour is stepping up its campaign against the measure. The party has today launched a new ad featuring Cameron writing a cheque for £100,000 to "a millionaire" and a clock counting down to "Tory Millionaire's Day". In response, expect the coalition to point out that the new 45p rate is, as Danny Alexander recently noted, still higher than the 40p rate seen for 155 of the 156 months that Labour was in power. 

Alongside the new campaign, I'm told that Labour, encouraged by how Barack Obama forced Mitt Romney onto the defensive over his tax bill, will continue to challenge the PM to say whether he will benefit from the reduction in the top rate. Private polling by the party has previously shown that 62 per cent of voters, including 46 per cent of Conservative supporters, believe he should "come clean and tell people honestly whether he is personally benefiting". 

Unlike George Osborne, who said last year that he would not gain from the move, Cameron has so far refused to say whether he will. When challenged on this subject by Stephen Pound MP at PMQs earlier this month, the PM replied evasively that he would "pay his taxes". Under ever-greater pressure from Labour, the Tories will need to decide whether this strategy is sustainable.

Labour's new advert reminds voters that those earning a million pounds a year will gain more than £100,000 from the cut in the top rate of tax.

George Eaton is political editor of the New Statesman.

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In your 30s? You missed out on £26,000 and you're not even protesting

The 1980s kids seem resigned to their fate - for now. 

Imagine you’re in your thirties, and you’re renting in a shared house, on roughly the same pay you earned five years ago. Now imagine you have a friend, also in their thirties. This friend owns their own home, gets pay rises every year and has a more generous pension to beat. In fact, they are twice as rich as you. 

When you try to talk about how worried you are about your financial situation, the friend shrugs and says: “I was in that situation too.”

Un-friend, right? But this is, in fact, reality. A study from the Institute for Fiscal Studies found that Brits in their early thirties have a median wealth of £27,000. But ten years ago, a thirty something had £53,000. In other words, that unbearable friend is just someone exactly the same as you, who is now in their forties. 

Not only do Brits born in the early 1980s have half the wealth they would have had if they were born in the 1970s, but they are the first generation to be in this position since World War II.  According to the IFS study, each cohort has got progressively richer. But then, just as the 1980s kids were reaching adulthood, a couple of things happened at once.

House prices raced ahead of wages. Employers made pensions less generous. And, at the crucial point that the 1980s kids were finding their feet in the jobs market, the recession struck. The 1980s kids didn’t manage to buy homes in time to take advantage of low mortgage rates. Instead, they are stuck paying increasing amounts of rent. 

If the wealth distribution between someone in their 30s and someone in their 40s is stark, this is only the starting point in intergenerational inequality. The IFS expects pensioners’ incomes to race ahead of workers in the coming decade. 

So why, given this unprecedented reversal in fortunes, are Brits in their early thirties not marching in the streets? Why are they not burning tyres outside the Treasury while shouting: “Give us out £26k back?” 

The obvious fact that no one is going to be protesting their granny’s good fortune aside, it seems one reason for the 1980s kids’ resignation is they are still in denial. One thirty something wrote to The Staggers that the idea of being able to buy a house had become too abstract to worry about. Instead:

“You just try and get through this month and then worry about next month, which is probably self-defeating, but I think it's quite tough to get in the mindset that you're going to put something by so maybe in 10 years you can buy a shoebox a two-hour train ride from where you actually want to be.”

Another reflected that “people keep saying ‘something will turn up’”.

The Staggers turned to our resident thirty something, Yo Zushi, for his thoughts. He agreed with the IFS analysis that the recession mattered:

"We were spoiled by an artificially inflated balloon of cheap credit and growing up was something you did… later. Then the crash came in 2007-2008, and it became something we couldn’t afford to do. 

I would have got round to becoming comfortably off, I tell myself, had I been given another ten years of amoral capitalist boom to do so. Many of those who were born in the early 1970s drifted along, took a nap and woke up in possession of a house, all mod cons and a decent-paying job. But we slightly younger Gen X-ers followed in their slipstream and somehow fell off the edge. Oh well. "

Will the inertia of the1980s kids last? Perhaps – but Zushi sees in the support for Jeremy Corbyn, a swell of feeling at last. “Our lack of access to the life we were promised in our teens has woken many of us up to why things suck. That’s a good thing. 

“And now we have Corbyn to help sort it all out. That’s not meant sarcastically – I really think he’ll do it.”