Richard Murphy approves of a piece of work pointing out that it's bollocks for DCam to claim he's investing £900m in HMRC when he's actually just reducing a £3,700m cut*.
Richard is quite right, if you take something away, and then give a bit of it back, then you're not really giving anybody anything. You're taking less away, and should present what you're doing honestly.
And isn't it for exactly that reason that it is exactly as bollocks to refer to tax relief on savings, pensions and investments as a subsidy?
* Of course, if the aim is to cut £3,700m of wasteful expenditure, and £900m is being given back to spend on useful things, then the claim has some merit.. but that's another issue.
Tax relief for savings is a subsidy of course. It does not benefit the savers at all - as it implies a higher tax rate on that remaining part of their income which they do not or cannot save, so that the government gets the same tax revenue but from a smaller base.
ReplyDeleteThe tax reliefs only benefit the usual suspects.
Glad to have cleared that up.