Wednesday, March 23, 2011

Some (pre)Budget thoughts

  • The devil will be in the detail. Do not think that just because Brown et al have gone that the reality and critique of that Osborne announces today won't unravel in the next few days and cause much more debate.
  • Don't expect the immediate abolition of National Insurance and its merging with Income Tax. A consultation and an aspiration is far more likely, after all, if he did it, tomorrows headlines would be "base rate income tax rises to X%". an NI and Income Tax merger can't be done overnight and would require a lengthy public discourse to soften the feeling that people were paying more than the already are.
  • Heavily trailed already this morning is the rise in the tax-free threshold at the bottom calling it a tax cut. Don't be fooled to much. With inflation running at above 4%, and the likelihood of pay freezes in the private sector, any gain will be swallowed up by the time the change actually comes in.
  • Fuel duty is more than likely going to remain static and will be billed as "helping" motorists. It is, naturally, bullshit to claim that not implementing a rise on an already overtaxed product whose price is rising constantly because of external factors is an example of the Government doing us a favour (more on what ought to happen with fuel tax in the next post).
  • Finally we have the "big surprise rabbit out of the hat"... not sure what that might be but it could be that there is no surprise to make him distinguish himself as a politician that cares about the economy and not political positioning, handily positioning himself in the process!

Will try to live blog later, work permitting.

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