Iain Duncan Smith is underrated, and was shamefully deposed in a putsch, conducted almost entirely on television, by economically neoliberal and socially liberal foreign policy hawks whose position could not be less conservative on all three points.
IDS has had a significant interest in poverty-related issues for a long time, and is to be congratulated for once again drawing attention to that debate. He has also stated publicly that he doesn't care which party does something about it, so long as it gets done.
Here is a key part of what should be done. All income below national median earnings for full-time work should be tax-free, with a flat rate of income tax thereafter, with no exemptions whatever beyond that personal allowance of national median earnings, and with a unified system called and delivering Social Security in the form of a universal income of half national median earnings.
Subscribe to:
Post Comments (Atom)
Does this add up?
ReplyDeleteAdd up to what? It would save a fortune in administrative costs.
ReplyDeleteWould you get this universal income off the state if you were working?
ReplyDeleteWell, no, not if your earnings already covered it. But no one would have an income below half national median earnings, and no income below twice that guaranteed minimum would be taxed.
ReplyDeleteBut all income above it would be?
ReplyDeleteYes. No more rich people paying nothing so that the shortfall is passed on to the middle and working classes as a sort of feudal tribute. Based on past form, watch out for them on this thread.
ReplyDeleteI though you were in favour of bringing back the tax allowance for fathers.
ReplyDeleteFo so long as Child Benefit is being paid to mothers.
ReplyDeleteActually, and I write as a crusty old bachelor with no vested interest, I'd rather like to see those two survive. They are unique.
Just interested in how much this would cost, how much it would save in administrative costs, and the net cost/saving. I don't know, but I assume you've thought this through. It's absolutely key to whether your argument holds up, for obvious reasons.
ReplyDeleteIt would save the difference between administering one benefit (maybe two if we kept Child Benefit, since that is feeding another mouth which has no other entitlement, whereas carers and the adults for whom they care are separately entitled) and administering heaven knows how many. IDS has done the maths in detail, so it's no doubt set out on his think tank's website.
ReplyDeleteAnd it would save the difference between administering one tax allowance (maybe two if we restored the tax allowance for fathers, for the same reason as Child Benefit, which cannot be kept without it) and administering heaven knows how many.
Add in that they all have different thresholds and what have you, all of which this would abolish, and ... well, you can work out the nuts and bolts for yourself, if you really see the need at this stage.
Never mind the nuts and bolts - what would the flat rate be?
ReplyDeleteYou should write about this in your next Telegraph column. Its gold.
ReplyDeleteSasha, I already have a long enough queue of pieces for that.
ReplyDeleteTrobe, it would depend what the government of the day wanted to do. The point here is the principle.
Excatly, it's the principle. The specific rate is variable.
ReplyDeleteThis depends on letting the market decide the median wage. They other side should be pleased.
ReplyDeleteWell, only up to a point.
ReplyDeleteI'm also in favour of a minimum wage of half national median earnings per hour, with each company's corporation tax allowance set at the cost of paying the minimum wage to every employee for all contactual hours.
And I'm also in favour of banning any company from paying any employee more than ten times what it pays any other employee, with the public sector functioning as a single entity for this purpose, its median wage pegged at that in the private sector.