By Tim Montgomerie
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There are lots of things I liked in today's Budget. The movement towards lower corporation tax, in particular. Getting rid of 50p and replacing it with taxes on property is economically sensible and socially just. Labour is simply being dishonest when it says this was a budget that gave too much to the rich. I think the politics of raising the income tax threshold are obvious but I'd have preferred we went down the Lawson route and that everyone paid tax but at low rates. I would have introduced a 10p rate but that debate has gone. The tax statement for every citizen is a brilliant idea. Relaxation of Sunday trading laws for the Olympics period is also a neat idea as long as its temporary. Also welcome were announcements on roads and decentralised pay but the devil will be in the detail on those changes.
The overall Budget Day experience was slightly disappointing. Everything apart from the sting on pensioners was preannounced. It wasn't clever of George Osborne to disguise what may amount to a £3 billion raid on pensioners. Labour is suggesting the average pensioner will lose £75 from next April. There are very good arguments for asking the baby boomer generation to shoulder a bit more of the burden but George Osborne should have made them and made them transparently. The press pack are more excited at the 'Granny Tax' because they discovered it and I expect it will lead many of the the papers tomorrow. Gordon Brown buried things in the small print and it's a shame the Chancellor has done the same.
Strategically I can only agree with Paul Goodman. There has been far too little focus on the size of Britain's bloated state. Cuts have been too timid. Two weeks ago ConservativeHome ran a five part series which identified tens of billions of pounds of extra cuts. Some of the cuts were much more politically realistic than others but if a fraction of them had been pursued the Chancellor would not have had to introduce so many job-threatening revenue measures over the last two years. The reality is that Britain was over-taxed when the Coalition came to office and is more heavily-taxed now. 38% of deficit reduction in this coming year comes from higher taxes but Britain doesn't have a tax problem but a spending problem. For the last three years the state has accounted for half of national income. Brown and Blair came to office as New Labour but governed as Old. Because the Coalition has not set a radical enough change of direction British business travels the world bearing an unnecessarily high tax burden. As Simon Jenkins argued in today's Guardian, "Cameron and Osborne are big government men to their cores". So long as they are spending a bigger percentage of national income than Brown and Blair spent for the vast majority of their time in office it's hard to disagree with that judgment.
Finally what's the big story? Is it deficit reduction? Is it fairness? Is it growth? I have no idea. There were lots of individual announcements today but no great sense of direction.