Budget, fudget

After Gordon Brown’s botched budget last week, many Labour MPs and activists were mustard-keen to point out that poorer people - those earning less than £18.5k - would be better off in the round, once tax credits were taken into account.*

So I was interested to read this snippet in today’s Financial Times, reporting the evidence given by Treasury officials to MPs on the Treasury committee examining the 2007 budget:

Officials were also willing to concede … that 5.3m families would lose from the budget changes; that government spending plans did not forsee the take-up rate of working tax credit rising from its current dismal 25 per cent; and that there would be no money in the autumn comprehensive spending review dedicated to fighting child poverty.

* There were two small problems with this argument: (i) it isn’t true, and (ii) not everyone is eligible for tax credits, as pointed out by Ming Campbell at PMQs yesterday.

Labour, party of social justice: RIP

Talk about a double whammy.

First, Labour’s Lyons Review flunks the prospect of wholesale reform of Council Tax, instead opting to tinker round the edges with bands that will make no difference to the vast majority of income-poor residents who suffer under the current system.

Then, Gordon Brown decides to double the starting rate of income tax, ensuring anyone who earns under £15,000 pa will be worse off. As Will Howells notes, this is some U-turn from the Chancellor who once proclaimed the importance of the 10p rate for the poorest in our society.

Badly done, Gordon, badly done.

My head hurts

Tonight, and not before time, I’ve completed my tax return. Happily, and for the first time, it appears the Inland Revenue is in my debt.

As I’d girded my loins against the usual demand for a few hundred quid this makes me happy. It also makes me worried, since I’m now convinced I’ve made a mistake in my adding up. (Heck, I’m only the guy in charge of Oxford city’s finances.)

And credit where it’s due. The online self-assessment forms are well-designed and in plain language - indeed, plain to the point of sarcasm. For example, I was amused - and when I say amused, bear in mind this was during an evening devoted to my tax return - to see this snippy aside in the guidance on whether home-workers’ water bills are tax-deductible:

The amount of water used in actually performing office related duties is likely to be nil. We accept that the room(s) have to be kept clean, but the costs of doing so are likely to be small. The cost of an occasional bucket of water for cleaning purposes will not change that.

Much more of that kind of no-nonsense sarkiness, and I could start warming to the Inland Revenue.