Unusually for this election campaign, the day started with some actual policy. Ed Miliband would abolish non-dom tax status, various newspapers reported.
On the face of it, this was a savvy political move along the lines of the 50p income tax rate. Regardless of the economics (or indeed the truth), Labour were hoping to identify themselves with soaking the rich, and to force the Conservatives onto the uncomfortable ground of being seen to oppose doing so. The initial headlines saw the story land broadly as Miliband would have hoped.
The first Tory response, issued shortly before midnight, took a familiar tack – namely that it’s a bit rich for Labour to demand action on something which they failed to tackle when they had the chance:
“Ed Miliband did nothing about aggressive tax avoidance and evasion for 13 years – the number of non doms exploded under Labour. We’ve increased the non dom levy and cracked down on wealthy foreigners who avoid tax by ensuring they now pay stamp duty on their properties.”
It was a blocking blow, intended to allow the Conservatives to avoid falling into the trap by comparing Coalition action to Labour rhetoric and inaction.
But then the story started to change. Poring over the detail, it emerged that the proposal wasn’t to abolish non-doms outright at all. Ah-ha, CCHQ cried. They’re claiming something they aren’t actually promising:
Small print of Labour’s policy shows they’re not actually abolishing non-dom status- only consulting on how long ppl can be non-dom for
— Patrick McLoughlin (@Patrick4Dales) April 8, 2015
Now the Conservatives had a riposte. Not only did Labour fail to abolish non-doms, or address aggressive tax avoidance or evasion for their 13 years in power, they aren’t even promising to do it now. (Nor are the Conservatives, but that was presumably intended to be a footnote). Labour are full of empty threats and hot air.
And then, having morphed once, the story proceeded to do so again. A reporter from BBC Leeds tweeted about an interview he did with Balls in January: “#Labour say they will abolish #nondom tax status. @edballsmp told me in Dewsbury he would keep it!” Ah-ha, ah-ha, CCHQ cried. Now we definitely don’t have to be the people running the risk of looking like we’re defending the rich – Ed Balls will do it for us. In fact, there’s a video:
Kapow! Wham! The press team weighed in behind it like Batman and friends into the Joker’s stooges.
Suddenly, Labour’s own Shadow Chancellor had said abolishing non-doms altogether would lose, not gain, money for the Exchequer. The tables appeared to have turned. So, Labour did likewise. Ed Balls published a hasty blogpost:
“The Tories have edited my words from January in an attempt to deliberately mislead people because they can’t defend their own refusal to act on tax avoidance. They have dropped the part of my interview where on non-domicile rules I say “I think we can be tougher and we should be and we will”. That is exactly what we have proposed.”
Are you still following this? Having started the day spinning that they were going to abolish non-doms, by mid-morning Labour were claiming they absolutely weren’t going to abolish non-doms after all, they were just going to tighten the rules. That’s despite the fact Ed Balls said in the clearest possible terms this morning that Labour would “abolish” the non-doms. Even more confusingly, that new defensive line from Labour is the same as the Conservatives’ attack line from the start of the morning.
Meanwhile, George Osborne piled in, just to complicate matters further:
— CCHQ Press Office (@CCHQPress) April 8, 2015
In short, by 11am the Chancellor was arguing that Labour were planning to go against Ed Balls’ advice from January and abolish non-doms, and at the same time arguing that Labour’s announcement was overhyped because the small print revealed they weren’t actually going to abolish non-doms after all. CCHQ fleshed the latter line out further by calculating that 60 per cent of non-doms would be unaffected by Labour’s rule change, even as they tweeted the clip of Balls to all and sundry. However, if that confusion gave Labour any brief sense that they might be getting free of the hole they had dug for themselves swiftly vanished as the comically inept Shabana Mahmood told Andrew Neil firstly that Ed Balls never said abolishing non-doms would cost money, and secondly that Labour were planning to abolish them after all:
Round and round the two sides wheeled, thrashing like tennis players with their shoelaces tied together. In the full detail, Labour’s proposal came a cropper, while the eventual Conservative response ended up almost as confusing. I suspect, though, that while Labour’s spinners can’t possibly claim to be happy with it all they will rest on the expectation that most voters will simply hear “Labour plan to tax the rich”, if they hear anything of the story at all. And that might well be enough for them.