On tax credits, I agree with Boris

Reducing the welfare budget is crucial and the public backs this endeavour. However, I agree in principle with the increasing concern being expressed in the party – by Boris and others – about the rapid withdrawal of tax credits.

One cannot take seriously the attempt to brand the Conservatives the “workers party” while they are deliberately making poor workers even poorer.

The IFS puts the average loss at around £750 a year; for those struggling on tight budgets this is a significant loss. David Cameron and George Osborne do themselves few favours by maintaining the discredited pretence that the “living wage” and increased personal allowance will make up for this, because they simply will not.

I am strongly in favour of easing the welfare dummy out of the suckling mouths of dependent Britons, for the betterment of our country. I firmly believe that people must take personal responsibility for how they live their lives and instil in themselves a stronger sense of self-reliance.

We cannot always expect to be bailed out or propped up by our fellow taxpayers. We need to become more financially responsible as a people (if this sounds preachy then know this; I am paying for my former irresponsibility with my very own personal household austerity programme!) The rolling back of the welfare state is an integral part of reforming and improving our national character and pulling Britain back from the brink.

I have long argued that the state must become financially sustainable and this simply cannot wait. Clearly, a £30 billion tax credit bill is ripe for the picking. So, what is my objection exactly?

Slashing tax credits without any accompanying compensatory policies is poor politics and unfair. As a method of administering welfare, topping up wages isn’t a bad idea in principle, tax credits are similar to a negative income tax and good way of aiding those earning a low wage.

Therein (finally) is my point. Let us remember that working tax credit is not doled out to idlers, or “scroungers”; it’s paid to people who work. It adds a little bit more onto their salary so they can afford, not just to provide for themselves and their family, but so they can pay the most demanding, greedy and spendthrift people of all; that’s right, the politicians, our government.

For money isn’t just for groceries and rent, it’s for income tax, National Insurance, VAT, fuel duty, council tax, green taxes, vehicle excise duty, insurance premium tax, stamp duty the BBC poll tax and… well, the list of individual taxes is enormous, one of the longest in the world. Feeling stressed and want to indulge in a sinful pleasure? Well there’s duty to pay on your alcohol and your tobacco too.

It is rather galling to hear Osborne and Cameron pronounce that they are converting our “high tax, high welfare” society into a “low tax, high wage society”, for where is this radical tax cutting agenda?

The cut in the top rate and in corporation tax were both great policies, but the miserly raising of the higher rate threshold and the personal allowance have been terribly disappointing.

The fat British state is greedy for its citizen’s money. The point being that we are a very long way from being a low tax society. If the Conservative Party wants to be the “workers party” it should allow the workers to keep a lot more of the money they earn.

The shrinking of the state is not just about balancing the books, it’s about changing the state’s relationship with its citizens. The government has long tried to do far too many things, and in the process it does many things badly and fails in its basic responsibilities.

It has been proven without a doubt that the state does not know how to spend our money better than we do, £1.5 trillion debt and a vast budget deficit evidence this.

So yes, the British people must change and welfare reliance has to be curbed, but in return the government needs to live without confiscating such vast amounts of our money.

If the Conservative Party really is planning for the next ten years, then it must think hard about how the state can live on far less, and how it can reward the people for bearing the brunt of austerity.

In the long term we should raise the National Insurance threshold, cut the higher and the top rate, lower VAT and abolish green taxes. Let the hard working people of all echelons of our society enjoy the fruits of their labour and watch the economy fly.

Allow the individual to keep more of their hard earned money and they will spend it more wisely than our profligate government ever could.


Ben is the Conservatives for Liberty web editor and a Brexit campaigner.  His political philosophy is an organic hybrid of classical liberalism and conservatism underpinned by a healthy instinctual scepticism. Follow him on Twitter:  @TheScepticIsle

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One Comment

  1. Sue Jameson says:

    Couldn’t agree more.

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