One of the many confrontations between the Liberal Democrat leadership and party activists this week in Glasgow is over tax. When conference debates its tax policy paper, ‘Fairer Taxes’, on Monday, it will vote on a motion that includes a reintroduction of the 50p rate of tax, should an independent review conclude that the cost of introducing it won’t exceed the amount it raises. It is this vote that the leadership expects to lose.
But I’ve been speaking to Tim Farron, the party’s president, who tells me that he is considering supporting the motion on 50p against the leadership’s wishes. He says:
‘I am sympathetic to the arguments in favour of the 50p rate. I will listen to the debate but at this stage I am minded to vote for it. We should say now that the issue is really that the rich pay the fairer share, even if that ends up being done through wealth taxes instead. I think we should have it in our manifesto as well.’
It was inevitable that the conference would debate the 50p rate: the committee deciding the motions added it in as an option for members to vote on because they knew members would table an amendment involving 50p anyway. But it is inconvenient for the leadership, not least because the row over the rate could have been dead and buried long ago if people weren’t so insistent on harking back to it. This is made all the more ridiculous by the fact that Labour only had the rate in place for about a month in 2010. At the time of the March 2010 Budget, commentators described it as ‘nakedly political’, with The Times publishing a memorable cartoon by Peter Brookes with Alistair Darling as Angela in American Beauty (below). But even Labour couldn’t have estimated the political difficulty that political move would still be causing three years later.
UPDATE Fraser has argued that cutting the 50p rate means the rich shoulder more of the burden than ever. Here’s the latest figures from HMRC:-