As Brian pointed out recently, when the Tories proposed raising the threshold at which Britons pay inheritance tax on an estate to £1m from the current £300,000, it would be denounced by the usual suspects as grossly unjust, etc, and once the initial furore had died down, the Labour government would copy it, up to a point.
So it has.
This proves a general sort of point that David Cameron, the Tory leader, should now pursue with all due vigour (although I doubt many of us crusty cynics will be convinced that Cameron has suddenly turned into Nigel Lawson, not that Cameron gives a damn about what a blogger like me thinks). It will have proved a general point that arguing for tax cuts, even supposedly middle class ones, is smart election strategy and can force the government of the day to respond. Frankly, if a politician like the Chancellor, Alastair Darling, acts cynically but it means people do not have to go through contortions to avoid paying some tax, that is progress.The government’s financial plans come with costs: the government intends to get rid of some old reliefs for capital gains, which could hit private equity, but at least it has simplified the tax code somewhat, which has become one of the longest and most complex in the western world.
Real progress, of course, will come when inheritance tax, along with other taxes, are reduced or in some cases, hopefully eliminated. And the situation will really improve when the next stage comes along – a general shrinkage of the state and the vast payroll of people living on public funds. Well, we can all dream, can we not?
