Don't fall for the Tories' spin over the 45p rate

Why the increase in tax revenues doesn't prove that the coalition was right to scrap the 50p rate.

The Treasury is busy spinning the latest income tax receipt figures as proof that it was right to abolish the 50p rate. Last month the new top rate of 45p raised £11.5bn, £1.3bn more than its predecessor. So, has Art Laffer (of the eponymous "curve") been vindicated? Do lower rates, as the right has long claimed, produce higher revenues? Not quite. The spike in tax receipts is most likely due to the income shifted from last year to this year in order to benefit from the lower rate. As the Institute for Fiscal Studies notes: "Receipts in April will have been boosted by high income individuals shifting income such as bonuses and special dividends from 2012–13 to 2013–14 in anticipation of the fall in the top rate of income tax from 50 per cent to 45 per cent". 

This, of course, is a trick the rich can only play once (unless the rate is reduced again), just as, in the opposite direction, they shifted £16bn into the previous tax year when the rate was still 40p (the real reason that the 50p rate raised less than forecast, although a £1bn isn't to be sniffed at). There was never a "normal" year of the 50p rate. This, of course, was precisely Osborne's intention. Having falsely claimed that the (anomalous) first year of the 50p rate proved that it was ineffective, he will now use the (anomalous) first year of the 45p rate to argue that he was right to scrap it. How much would the 50p rate have raised? We'll never know; Osborne cancelled the experiment at birth. 

The 45p rate may well raise more in the months ahead but we'll have no means of detaching this from any concurrent increase in growth. But don't expect that to stop Osborne declaring victory in the 2014 Budget.

George Osborne arrives to attend a press conference at the conclusion of the IMF UK mission. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Who will take responsibility for the rise in far-right terrorism?

Muslims are asked to condemn Islamist terrorism – should the mainstream right do the same when the attackers are white?

Following the attack on a Finsbury Park mosque, both Theresa May and Amber Rudd have issued statements and delivered speeches adopting hard lines against Islamophobia and right-wing extremism. May has gone so far as stating that Islamophobia itself is a form of extremism.

These pronouncements have drawn positive responses from prominent members of the Muslim community such as Miqdaad Versi of the Muslim Council of Britain. But it is important to question whether or not this change in rhetoric signifies a genuine change in government policy.

On the face of it, there are reasons for tentative optimism. The seriousness with which politicians took the Finsbury Park attack is a significant change. On this, the government is ahead of the media. While other terrorism attacks have been condemned as unjustifiable violence, some newspapers framed the Finsbury Park attack as a "revenge".

In fact, radicalisation is not a one-off event, but takes place in a web of institutional, social and ideological conditions. Furthermore this ignores a much longer story about the drip, drip, drip of Islamophobic or anti-Muslim discourse which permeates British society. 

The government has played a part in legitimising this anti-Muslim sentiment. Let’s not forget that Prevent has, since its inception, disproportionately targeted Muslims. The impression of an "us and them" mentality is only underlined by its secrecy. Moreover, the Prevent agenda has conflated a variety of other social policy concerns relating to gender equality, sexual violence, and unemployment as "extremism" issues. For example, Amber Rudd herself suggested that Islamophobia would decline if grooming stopped, which can not only be seen as victim-blaming, but further contributes to stereotyping Muslims as the enemy within.

So are promises to get serious about Islamophobia more empty words from the Prime Minister?

Think about timing. Far-right extremism has been deadly. Mohammad Saleem was brutally murdered in 2013 in Birmingham by a far right extremist. Mushin Ahmed was killed in 2015 (and was notably called a "groomer" by his attacker as his head was stamped on).

Jo Cox was murdered by a far-right extremist this time last year. This is not even mentioning individuals such as Ryan McGee, who made a nail bomb and was intent on murdering immigrants.

Just twelve days ago, the Prime Minister claimed that Britain was too tolerant of extremism, and she was right. Just not in the way she meant it.

Britain has indeed been too tolerant of extremism of the far right kind. This is a rising problem, not just in the UK, but also in Europe.

According to the defence and security think-tank RUSI, far right extremists make up 33 per cent of the threat, with Islamic extremism slightly more at 38 per cent. Furthermore, one in four referrals to Channel, the UK deradicalisation programme, are from the far right.

We cannot forget the government itself peddles the tropes of far right hate. Think of David Cameron referring to migrants as "swarms", May’s hostile environment policy, complete with "go home vans" driving around in multicultural areas, and the uncritical embrace of Donald Trump’s presidency by the Prime Minister. 

The Muslim community has been told many times to fight terrorism from within, but will there be a similar response to far right extremism? The ongoing rhetorical attacks on multiculturalism, and the longstanding association of Islamist radicalisation with a lack of integration, rather than religiously inspired political violence, make it difficult to see how real change will happen.

This would require deep soul-searching, followed by serious changes in public debates about policies relating to both immigration and extremism. Until that happens, May’s words on Islamophobia will be nothing more than political PR.

But this PR also has a more sinister element. Although no specific new counter-terrorism legislation was announced in the Queen’s Speech, there was a promise that the government would review existing counter-terrorism laws, with a spokesman stressing that new legislation would be brought forward if needed.

May continues to lobby for increased executive powers to fight terrorism, which she has done since her time as home secretary. The policy on right-wing extremism is likely to follow that of Islamic extremism: it will focus only on ideology and it will ignore the wider context of structural racism and white privilege.

Ask yourselves, will white men ever be stopped and searched to the same extent as brown men? Will white women be seen as easy targets for violent attacks as Muslim women disproportionately are? Will far right extremists fear for their citizenship status?

And does the solution to extremism, in any form, truly lie in further oppressive legislation and more government power? We also need to be aware that powers extended to address extremism are likely to continue to have a disproportionate effect on minorities.

As long as there is no change in government policy, the status quo will continue to reinforce the same divisive narrative which is the bread and butter of every extremist group. After the Queen’s Speech, we continue to see no evidence of any serious attempt to reform policy and seriously address far right extremism. May’s empty words after the Finsbury Park attack represent nothing more than an opportunistic political move from a weakened Prime Minister who is desperate for approval – and for power.

Dr Maria Norris is a political scientist researching terrorism and national security. She is a Fellow at the  London School of Economics and Political Science. She tweets as @MariaWNorris.

Dr Naaz Rashid is a Research Fellow at the School of Law, Politics and Sociology at the University of Sussex and is author of Veiled Threats: Representing the Muslim Woman in Public Policy Discourse (Policy Press 2016) about the UK government's engagement with Muslim women as part of its Prevent agenda. She can be followed on Twitter @naazrashid.

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