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Coffee House

George Osborne readies his tax dividing line

16 March 2014

11:08 AM

16 March 2014

11:08 AM

George Osborne was on Andrew Marr this morning announcing support for a new garden city at Ebbsfleet in Kent and the extension of Help to Buy on new build homes until 2020. The Tories hope that these policies will show both that they are planning for the long term and that they are supporting aspiration.

But what struck me as most significant was Osborne’s response when told by Marr that he was sounding more like a Liberal Democrat than a Conservative. He instantly replied, ‘Conservatives believe in lower taxes, Liberal Democrats want to put taxes up.’ We already know that Osborne believes that the rest of the deficit can be cleared without any more tax increases and this reply suggests that the Tories will run in 2015 as the only party that won’t put up taxes.

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Strikingly, Osborne also talked about putting up the tax free allowance in a rather different way than he does normally. He was keen to emphasise how this policy helps people on £50,000 as well as those on low incomes. It remains to be seen if this will be enough to satisfy those Tories who are pushing for something to be done about just how many people are being dragged into the 40p tax band, another 1.4 million people just since this government came to power.

This week’s Budget will not be a classic pre-election Budget. Osborne still wants to emphasise the ‘difficult decisions’ ahead to show that the job is not yet done. But it will lay the groundwork for the election campaign to come. Osborne will be keen to make Labour vote both on a new set of fiscal rules and on the proposed welfare care. If they oppose either, he’ll attack them for not having learnt from their mistakes.

On the evening of Wednesday 19 March 2014, Fraser Nelson, James Forsyth and Andrew Neil will be discussing what George Osborne’s 2014 budget means. Click here to book tickets.

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