Liberal Tax Cuts don't Add Up
Tuesday, 12 May 2009
I listened to Danny Alexander on Radio 4's Question Time last Friday and had to admit that we both seem to share some pretty similar political values. Having read his regular column in the Courier last week, however, I find myself concerned.
In his comment on Labour's budget, his main argument was that we should be reducing income tax for low and middle income households in order to offset the worst effects of the recession. This echoed the Lib Dem proposal during this year's Scottish Parliament Budget discussions to cut income tax by 2p.
What he totally fails to say, however, is where the inevitable cuts in government spending that would result will need to be in order to fund such tax cuts.
Labour has made a deliberate choice to invest in jobs and services as the way of driving ourselves out of the recession. Just as President Roosevelt did with the New Deal in the US in the 1930s. It worked then and I believe it will work for us now. You can't deliver such investment - least of all during a during a recession - and make broad tax cuts (Labour increased marginal tax rates on those earning more than £150k).
Are the Liberals just saying what they think people want to hear (who does not want a tax cut) rather than being serious about investing our way out of this crisis? Or are they really planning for cuts in services?
