Nick Clegg's proposal to push ahead "further and faster" with plans to raise the income tax threshold may bear all the hallmarks of political choreography. And it may not be the difference between recession and recovery. But it is no less important for all that.
Given that the £10,000 threshold was the centrepiece of Mr Clegg's speech on taxation yesterday, it is fair to assume that the scheme is all but signed off by the Treasury . But while the Liberal Democrats may be able to turn the sliding economy to their advantage in making the case, it would still be a mistake to expect too much direct economic impact. Even were it to be put in place in full, a £10,000 threshold translates into only around £700 per year taken off the average tax bill – not nothing, of course, but hardly sufficient by itself to re-energise consumer confidence.
Even so, the move is far from irrelevant. Not only would several million people on low incomes pulled out of tax be a significant step along the road to making work pay. In political terms, the policy also helps Mr Clegg pull his party out of the smothering embrace of its Tory partner. And as debates about ethical capitalism gather momentum, constructive efforts to ensure all are paying their share cannot but find favour.
The key question is how an increased personal allowance can be paid for without either raising government borrowing levels or unduly punishing success. Mr Clegg used yesterday's speech to repeat his call for a "mansion tax" on houses worth more than £2m. Although proposals to raise levies on wealth, rather than income, have much to recommend them, the mansion tax has next to no chance of finding favour with a Conservative Chancellor.
The Deputy Prime Minister does have other less eye-catching ideas, such as closing loopholes favouring the wealthy and clamping down on stamp duty avoidance. In this, he is right; an overhaul of the reliefs and allowances at the top end would more than pay for tweaks at the bottom. Mr Clegg says his party keeps the Coalition "anchored in the middle ground". It is quite a claim. A fairer tax system would help prove it.Reuse content