This year the word ‘budget’ struck fear into the hearts of members of the Conservative Party because of the increases they believe are necessary but foresaw the rest of the country resenting. For Conservatives, this week has been one of persistent confusion, ever since the 2012 budget people here have been discussing pasties and static caravans extensively (being from the West Country where tourism is a lifeline) and Mr Osborne’s announcements last week were gratefully received, but should we be concerned about the amount of U-turns the Conservative Party are having to make?
In last year’s budget, George Osborne offered a cut in inheritance tax if people donated to charitable causes, a move aimed at stimulating the floundering idea of the Big Society; the move meant if you qualify to pay inheritance tax but you give 10% of your estate to charity, the rate of that tax is reduced from 40% to 36%.
Fast-forward a year to Osborne’s 2012 budget, in which it was announced that tax relief on charitable donations will be capped at 25% of one’s income or £50,000, whichever is higher. How are the two policies consistent? One encourages charitable donations with the promise of a reduced inheritance tax bill whilst the other is specifically aimed at warning individuals that such donations should not allow them to avoid paying tax. In keeping with most of the government’s fiscal measures, it’s a mess. Read the rest of this entry
Ed Miliband this morning made a bold intervention over funding for political parties, claiming that donations should be capped at £5,000 – a figure that is one tenth of the cap of £50,000 that David Cameron has previously put forward. The really headline-grabbing move though, is that Miliband signalled that trade unions will also be subjected to this cap, a move that he claims could deprive the Labour party of millions of pounds. Read the rest of this entry