MP warns Hunt and Johnson - don't be 'foolish' with tax cut promises
PUBLISHED: 12:34 04 July 2019
In his latest column, Sir Hugo Swire says he is 'decidedly uneasy' about tax reform promises being made by the prospective leaders of the Conservative Party.
The Tory leadership contest has, unwittingly perhaps, launched a serious debate about tax reform.
The two candidates have been making all kinds of promises.
Jeremy Hunt, after one week of campaigning, had racked up tax and spending pledges that the Institute of Fiscal Studies reckons could cost up to £46 billion a year.
These include cutting corporation tax and the interest rate on student loans. Boris is not much better; he wants to raise national insurance and higher-rate income tax thresholds whilst also rolling out full broadband.
All these promises make me decidedly uneasy; our party has a reputation for financial prudence and it would be foolish to blow it now especially with a possible no deal Brexit around the corner.
But the promises made by Conservatives are nothing compared to Labour's which is toying with radical plans including land tax, removing the capital gains exemptions for first homes and a tax raid on family homes, which will slash legacies for millions of children.
The Shadow Chancellor wants to ensure that 'wealth is more fairly distributed'. Inheritance tax has always been a thorny issue of course, but I suspect Mr McDonnell's plans are more to do with ideological Marxism than receipts, since statistics appear to back up the theory that it would actually bring in a small amount of money.
There is no doubt that we are ready for a debate on tax reform.
But that debate should be around simplifying a ridiculously complex system not making it worse.