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October 4, 2014 / politicsbitesize

Tax cuts for all

TaxCutsThe Conservative Party Conference this week gave rise to some headline grabbing election pledges: ‘Osborne to save £3bn a year with cuts to welfare’; ‘Cameron promises to cut taxes in the next parliament’; and ‘Tories pledge to pour millions into the NHS’. But it is the subtle message behind these statements that is a cause for real concern.

David Cameron’s speech on the final day of the conference held in Birmingham laid claim to reducing taxes for 30 million people if his party returned to power in May 2015. He stated that he would raise the tax free allowance to £12,500 and raise the threshold of the 40p income tax rate from £41,900 to £50,000. The Prime Minister was delighted to say that under a Conservative-led government a person working a 30-hour week on the minimum wage would pay no income tax.

Although his proposals would see one million working people paying ‘Nothing, zero, zilch’ in tax per year, it is astounding to think that, in the UK in 2014, there is still such a large number of people who are paid up to £12,500pa. What is really needed is a government that will tackle poverty wages and work with businesses to secure a living wage for all.

As Owen Jones has rightly identified, a living wage would reduce the welfare bill by billions. In his ‘Agenda for Hope’, the author and activist highlighted the fact that paying a decent wage would be the best way of reducing people’s reliance on in-work benefits, which in effect subsidies low paying bosses. If a living wage were to be introduced then George Osborne’s pledge to cut £12bn from the welfare budget would actually be an empty promise, rather than simply the electioneering tactic that it is.

In order to reduce the deficit (that was caused by the banks and not government spending), the Conservatives have tightened the belts of numerous Whitehall departments and slashed benefits for those most in need. It seems that the current government think that more cuts are needed, and the Labour Party has voiced its concern that the NHS and education will be next up for budget reductions.

The Prime Minister has assured the electorate that NHS funding is ring fenced and went as far as to say that a future Conservative government would increase spending on the NHS. But the reality is that soon the NHS, and eventually our schools, won’t require as much public funding as in the past thanks to the Health and Social Care Act.

Entire hospitals, such as Hinchingbrooke in Cambridge, are currently being operated by private ‘partners’ and a myriad of services are being put out for private tender. The NHS might remain ‘free at the point of use’ but it won’t be free from the rampant marketization of our public services.

All the Conservative Party Conference has shown us is that the neoliberal agenda is alive and kicking. The pledge to lift millions of working people out of tax normalises the ideological notion that tax avoidance, in one form or another, is perfectly acceptable. Furthermore, it stands to diminish the responsibility of big businesses to pay their fair share of taxes, which in the end will undermine the public sector as a whole.

Without taxes there will be no treasury to pay for vital public services and therefore no publically funded NHS or education. The result of this marketisation of universal services is a return to a feudal society wherein only those with money have access to education and healthcare. What a crying shame it would be if we were to repeal all that our ancestors fought so hard to obtain.

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