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The Madness of George: Mr Osborne’s latest attack is on the smaller businesses and sole traders who prop up the UK’s economy. Does he understand nothing at all about his job?

It seems George Osborne wants to focus his next attack on the small businesses of the UK – the firms that form the vast majority of the nation’s business base.

Lunacy, you might say. Craziness. You may ask why he would want to do such a thing, and what evidence I have to suggest it.

Well, let’s start with the letters going out to 1,500 people suspected of taking part in a tax avoidance scheme – which is currently legal, although the BBC report suggests its legality will be challenged. These people are suspected of depriving the Treasury of £10 billion per year.

The National Audit Office said HM Revenue and Customs was dealing with a backlog of 41,000 cases of aggressive tax avoidance involving individuals and small companies.

That’s all very interesting. Why not write to the shareholders of the Thames, Anglian and Yorkshire Water companies, whose tax avoidance history received an airing in the press and on this blog very recently? The evidence suggested they were removing a combined total of £1 billion per year to tax havens offshore and, to me, it seems far simpler to write letters to three companies, and investigate them, than to 150 individuals.

Could it be because the water companies were exploiting tax loopholes that had been created especially for them, and other large businesses, by Mr Osborne himself in 2011?

Could it be that shareholders in those large concerns might also be donating money to the Conservative Party? Attacking them would be the political equivalent of self-harming, if that were the case.

So the focus of attack goes down to the smaller business or sole trader.

Were you aware that Mr Osborne is considering changing road tax rules, to introduce a new two-tier system?

It seems he wants to create a class system for the roads, in which second-class citizens will be licensed to use the smaller roads, while first-class citizens will be able to pay for the extra tax disc, entitling them to use the motorways.

I see that as an attack – on the private driver, yes, but also on the small businessperson. Think about it. Small businesses can spend a lot of time on the roads, zipping around between jobs. An extra expense on the balance sheet could be the difference between being a profitable concern and going under.

At a time when the UK is relying on small and start-up businesses to re-ignite the economy, this is nothing short of madness.

But then, when’s the last time anyone ever suggested George Osborne had sense?