It seems the UK Independence Party has decided to lure blue-collar workers away from Labour and the Conservatives by promising to push their faces even more firmly into the dirt.
The party’s tax policies, unveiled at UKIP’s conference today (Friday) offer huge benefits to top earners while threatening fewer services to those at the bottom.
At the moment, UK citizens don’t pay tax unless they earn more than £10,000 per year, then they pay a basic rate of 20 per cent on earnings up to £41,865. From £41,866 to £150,000, 40 per cent is payable, and an ‘additional rate’ of 45 per cent is paid on anything over £150,000.
UKIP would raise the tax-free personal allowance to £13,500, with the basic rate being increased to cover earnings up to £44,000. Then the 40p rate would be cut to 35p for people earning between £44,000 and £55,000, and those earning more would pay 40p, with the ‘additional rate’ scrapped.
Huge benefits for the obscenely rich, moderate benefits for the modestly well-off, and what do the poor get?
They get a tax-receipt black hole of at least £12 billion every year.
UKIP reckons this won’t matter, because the loss would be wiped out by savings made from leaving the EU, cutting the foreign aid budget by 85 per cent and cancelling the HS2 rail link.
The trouble is, some experts reckon the changes would cost £20 billion, meaning deeper spending cuts that would impact most strongly on services for the poorest in society.
Not only that, but there is no way of knowing what effect leaving the EU will have on the economy. The European Union is the UK’s main trading partner, with contracts worth more than £400 billion a year. How many of those will remain? And what about the UK citizens currently living in the EU? There are around two million of them, if memory serves correctly. Will they lose their jobs and be sent back here? Will those who have retired be told they can’t stay any more, as they aren’t EU citizens?
What will that do to the UK?
It seems that former Treasury official James Meadway, now senior economist at the New Economics Foundation, has the right idea. He said the proposals would be a “social catastrophe” if implemented.
“What they’re proposing is a hugely expensive means to make the tax system even more unfair. The ‘blue-collar’ stuff is just so much windbaggery and spin – this is a tax proposal that will benefit the richest most, whilst slashing the amount of money available for the public services we all need,” he said.
What a good thing it’s not going to happen, as Nigel Farage and his chums are only contesting around 12 seats.
Follow me on Twitter: @MidWalesMike
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