Here’s an interesting thing: Number 10 has released a statement on Ed Miliband’s 10p tax rate pledge. The Downing Street press machine hasn’t been in the habit of doing this sort of official reactive spinning, although this may be in part because Miliband’s speeches thus far have been pretty light on anything you can actually react to. This is what a No 10 spokesman said:
‘This is a stunning admission of economic incompetence from Ed Miliband and Ed Balls – that their decision in Government to scrap the 10p tax rate hurt millions of working families. People will never trust Labour again. The low income working people who lost out the most from Labour’s 10p tax hike now pay no tax at all thanks to this Government’s record increases in the tax free personal allowance. Losers under Labour have become winners thanks to our tax changes.
‘Now Labour’s new homes tax would mean government snoopers in every home to revalue your house for council tax, meaning council tax rises for millions. Instead this Government has increased tax on the richest in every Budget, through higher stamp duty on expensive properties and taxes on the biggest multi million pound pension pots.’
Labour will like this, jeering that Miliband has clearly rattled Cameron’s cage (which, whether you agree with the policy or not, he has because the Prime Minister made a point of claiming the speech would have no new policies in it at PMQs yesterday, and because he referred to the 10p tax rate, too).
But while the second half of this statement makes an very good point about the way Miliband would fund this change by using a mansion tax, leading to the dreaded revaluation of properties (and Ryan Bourne has written an excellent post for us explaining these problems in more detail), there’s also something just a little bit amusing about Number 10 scolding someone else for changing tack on tax policy, given the number of U-turns that the Treasury had to execute after last year’s Budget.
However, even if admitting the mistakes made by your party when it was in government is a wise move, there’s still, as the No10 statement points out, the problem of whether voters will trust Labour again on the economy as a whole. And as our leading article this week says, Miliband is trying to say ‘trust me’ when voters don’t trust anyone.