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Brown signals tax cuts to help the hardest hit
Paul Waugh, Deputy Political Editor10.11.08
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GORDON BROWN today gave the strongest hint yet that he will unveil emergency tax cuts to help families cope with the recession.
When asked if he was considering tax relief moves, Mr Brown said he would “make announcements very soon”.
Buoyed by his success in the Glenrothes by-election, Mr Brown is determined to use this month's pre-Budget report to outflank the Tories by offering tax cuts funded by extra borrowing.
But the Tories — due to announce their tax-cut plans tomorrow — say they oppose any borrowing plans, preferring instead for the funding to come from savings in government spending.
Mr Brown fuelled expectation of a tax cut last week by saying there was an “emerging consensus” on the need to revive the economy.
Today he told GMTV: “We will make announcements very soon. Of course we will look at everything, but that's a matter for the Budget and pre-Budget report”.
Mr Brown stressed that he had already cut income tax and families were getting an extra £120 in their pay packets this month and next.
The Prime Minister added: “What I am determined to do is to get all countries around the world trying to get their economies moving again and one way you can do that is by putting more money into the economy by tax cuts or by public spending rises. That's something that we've got to look at in the next few weeks.”
In a Mansion House speech tonight Mr Brown is set to underline his belief that countries around the world could fight recession by using “fiscal stimulus” packages of fast-tracked public works and targeted tax cuts.
Chancellor Alistair Darling is expected to announce measures to help families in the pre-Budget report, but Downing Street and the Treasury were keen to play down speculation that taxes could be slashed by £15 billion.
The Treasury is working on a string of options, including possible rises in working tax credits — a move that would help Labour reach child poverty targets. There could be possible cuts in VAT, fuel duty and a new stamp duty “holiday”.
The Bank of England will give the Tories further ammunition this week as it prepares to ditch its growth forecasts and confirm that Britain is entering a recession.
David Cameron put fears of unemployment at the heart of the Tories' election message today by declaring his party would not “stand by and do nothing” while joblessness rises.
Signalling that he will unveil tax cuts to help businesses keep people in work, the Conservative leader said that politicians had a “moral obligation” to help those whose jobs were threatened or lost through no fault of their own.
In a speech to a Conservative women's conference at Westminster, Mr Cameron said that the return of mass unemployment was a “recipe for social disaster”, which threatened to deepen the problems of Mr Brown's “broken society”.
New figures due this week are expected to show that the jobless total has soared above 1.8 million. Mr Cameron warned that prospects for jobs next year were also “grim”.
Writing in the Evening Standard today, shadow chancellor George Osborne made clear he would oppose any “unfunded” government tax cuts paid for by soaring borrowing.
Tory sources suggested that the party will redraft the public finances to fund tax cuts. In one plan, they hope to “bank” savings from lower unemployment benefit in future years by using the cash now for tax relief.
Other plans could include national insurance holidays for firms and measures to make it easier to hire and retain staff.
Mr Cameron said: “The Conservative Party will not allow unemployment to ruin lives on a massive scale. We will not walk on by while people lose their jobs.”
Despite signs of a Brown bounce in the Glenrothes vote, a new poll indicates that the Tories have held a 13-point lead. ICM put the Conservatives on 43, Labour on 30 and Liberal Democrats on 18.
Reader views (30)
I have a better and more efective solution to give for Mr Brown:
1. Stop immigration legal, illegal and asylum. More jobs will be released to British if work permits are scrapped(every knowledgeable person knows that there are skilled people here and companies are playing games by importing these and schools and hospital expenses for them outweigh their tax contribution as they bring in large families) Illegal and asylum seekers are burden to the society and savings can be made by cutting the admin costs by blocking them alltogether.
2. Stop outsourcing to India including IT work and call centres. Force companies to employ local labour and force the companies bosses to forego bonuses as they are the reasons cheap labour is sought in India to maximise profits. Companes can have smaller profits by employing British labour.
3. Wind up the ministry for overseas aid, headed by Brown's crony Alexander and which has a budget of over £5 billions and which is frittered away in Africa. Charity should begin at home. We have British needy
and they should get help not Africa or any other developing country.
All the above will transfer wealth to us the citizens.
Brown will not do it. Hence he should be kicked out in the next eletion. This man was the reason we are in troubl with the economy and are so over populated that we feel like we are living in a developing country like India. London as as congested as Mumbai. Brown tax cuts is a gimmick after he bumped up stealth taxes.
- Norman, LONDON
Val Daniels: Do you mean the government still pay a heating allowance to ex pat pensioners then? What a disgrace. You won't need it as your heating bill in Spain will be much lower, plus the decent weather helps of course. If Labour are so wonderful in your eyes what you are doing living in Spain, surely you would only move there if the Conservatives got in according to your comments!
- Sue, Orpington, Kent
When did Brown visit Damascus? 'cos he sure has been on the road to it?
This is the man who has by stealth increased taxes.
This is the man who increased the proportion of upper rate tax payers by keeping tax allowances below the growth in wages.
This is the man whose department spent 4 years dragging a small businessman through the courts for money he did not owe
This is a man who seems to have offered money to various people from Banks to all and sundry.
This is a man who has increased the debt this country owes and then moved a large chunk off the balance sheets
And he is going to give a reduction in tax
- Paul, London
I fail to see how giving out tax cuts is going to get NuLiebour elected again.
The only people who possibly could vote for them are on the dole and therefore do not pay tax and are uneffected by the recession. Everyone else in the real world has had enough.
- Jimbob, Kensington
To Val Daniels in Mijas Costa Spain. I say once again " If life is so wonderful under Gordon why don't you come back to live in The Wonderful Fantasy world Of Nulabour ?" is it because you know how crap it is ? Your constant rants in Browns favour make me laugh !just like the hypocrit ministers under him .Its all "do as I say" and not "do as I do" and unfortunately your postings are the same.
- Michael, London
@Val Daniels, Spain.
The Tories didn't sell Abbey National. It was a building society and it was sold by it members. Your correct, gold was at rock bottom, gordon announced to the world he was selling and this caused gold to fall even lower. As you said "Get your facts right before you write anything, your misinformed comments only serve to make you look stupid"
- Chris Smith, Rochester
Val from the delightful hillside town of Mijas: when are you going to stop sticking your nose in the UK's business?
- Nobby Clark, Perth, Scotland
He who made this mess the great Crash Gordon should resign and let the professionals take over. We need proper economists now not just state bureaucrats.
- Phil, Islington, London
At least if its in our pockets it is less likely to be wasted.
- Brian Edmonds, Farnham UK
"Val Daniels, Mijas Costa. Spain"
You accuse Keith Lonsdale of not changing the record, but perhaps you should look in the mirror? You seem content to prattle off the Labour line like a lovesick parrot, while simultaneously telling barefaced lies about Conservative policies. And the way Gordon Brown can afford to give pensioners £250 a year for fuel is by raiding their pensions in the first place. If Labour are so great why don't you come and live here and take advantage of all they have to offer?
- David, Kent, UK
It seems clear to most the UK has been and still is over-producing in terms of consumables and this has been fuelled by the Nu Labour policy of taking the brake off public borrowing. This has helped to keep unemployment at reasonable levels. However, the chasm between the rich and poor has never been wider and there is now a very strong argument for heavily taxing anyone earning more than £100k per year, to the extent of say 75%, increasing welfare payment levels, and thereby configuring unemployment figures to a sensible level, perhaps through public works programmes such as coastal defence work, targetting flood-risk areas, and expanding the British coal industry which has sufficient supplies to take us into the next century. The current Labour economic strategy is flawed and a very cold winter with power cuts and fuel shortages could destroy the government.
- Robert El-Cid,, Hull, East Yorks.,
"Keith Lonsdale, Doncaster"
When are you going to change the record? Why don't you write about how John Major sold BRs trains for £73m in 1996, and how they were sold on again later that year for £825m, and on again to Abbey for £1.4 billion. And now the banks (including Lloyds TSB) have just bought them for £2 billion. A 2,700 profit in 12 years, and all down to the Conservatives. I bet Central Office don't tell you those little nuggets, do they? For your further information, Gordon Brown exchanged some of the gold reserves, not all of them, for euros so our reserves would be more diverse, and we wouldn't have all our eggs in one basket. The price of gold was at rock bottom then. It happens, prices go up and they go down. Get your facts right before you write anything, your misinformed comments only serve to make you look stupid.
- Val Daniels, Mijas Costa. Spain
John Smith, London, UK
Thanks to the Labour government, pensioners get £250 every November towards their heating costs. Under the Conservatives, they got nothing. Most retired people I know dread the Tories coming back because they know the heating allowance will be one of the first things to go.
- Val Daniels, Mijas Costa. Spain
Let's make it easy for him and refuse to pay any taxes.
- Neil, london uk, Airstrip ONE .
So Gordy, what tax cut are you going to give to pensioners on the minimum state pension who pay no tax?
Yet more hot air from ZanuLab!
- John Smith, London, UK
I agree with Mark from London - those of us without children need help too. Having opted out of having a family, I get a bit tired of having to donate to those who have.
- Deborah, London
"A reduction in gas and electricity prices can be achieved in one huge swoop by removing the ridiculous 5% VAT levy.."
Sorry William, but this is no longer possible under EU rules..
- John Smith, London, UK
the best help he can give is to call an election
- Kevin, london
Hey Gordon I have a good idea. Why not have a 10p starting tax-band for the first £2,000 or so of taxable earnings? You know like the one you scrapped not long ago.
- Joe, London, UK
I suspect the tax cuts will be funded through another bumper increase in council tax
- Chris Smith, Rochester
Here's an idea Gordon, how about a general tax cut? Not an emergency one, not a tax credit, not fiddling at the margins just a simple, cheap to administer cut in the main rate of income tax. Has the feel-good factor and anybody with a mortgage/borrowing which does include those of us wiithout children would be more likely to spend.
- Mark, London
I'll just keep an eye on his other hand. Brown doesn't know how to cut taxes on a net basis, it's not in his nature.
- Paul, London
A reduction in gas and electicity prices can be achieved in one huge swoop by removing the ridiculous 5% VAT levy. That would be popular and totally justified given the extortionate price increases imposed since last winter.
- William Grierson, Kimpton, UK
I expect people will fall for this con again as they always do, they're funding their own tax break via inflation and they think it's great. It's a shame that people invest so much in this personality politics,We have a globalist prime minister who's main goal is to end british soveriegnty, and a conservative leader who thinks that giving the parasites at the bank of england even more independence. and why do the the public refuse to understand that a privately owned, for profit central bank is not in our interest as a nation. I'm a capitalist but i challenge anyone to demonstrate to me that we have ever enjoyed a true un-manipulated free market economy because it's never happened and it will not so long as you have the bank of england printing fiat money and fractional reserve banking. ABOLISH THE BANK OF ENGLAND NOW! But there aren't any andrew jacksons, abraham lincolns or john kennedy's in british politics who are courageous enough to tell the truth about the central banks. they're all cowards!
- Simon Lomax, warrington
Increased handouts and tax credits for people on benefits does not constitute a tax cut. In fact, for those of us that pay tax, it is more gross misuse of our monthly money grab by the Treasury.
- Nobby Clark, Perth, Scotland
We HAD an emergency tax bracket - 10p - and I believe Crash abolished it. So please don't insult our intelligence by talking of future "emergency tax cuts".
- Marianne, SW France
I wouldn't believe a word about tax cuts from anyone in NuLiebour, unless it was a statement that there won't be any.
Gordon Clown cannot keep his hands off our money. This is the man that has stolen £225 BILLION from the UK's pension funds, has presided over the highest fuel taxes in Europe, flogged off half of our gold reserves at rock-bottom prices and, whilst "giving" with one hand has taken away with almost 100 stealth tax rises buried in his deliberately complicated budget statements (yes, I know he's not chancellor any more, but do you really think that Captain Darling speaks for himself? Dream on!).
We are on the rocks and breaking up rapidly, just like we were the last time this bunch of hopeless incompetents was given control of HMS Great Britain's helm.
- Keith Lonsdale, Doncaster
Poor old Gordon can't win can he? Give the guy a break for Gods sake! He's giving you back money and you are still complaining... God knows what horrible things the tories would be up to if they were making the decisions.
- Mc, London
Lets not forget as chancellor he was the architect of many stealth tax hikes, so this is just window dresssing with one eye to the election. I have not forgiven him for helping to kill off final salary pensions by removing tax breaks.
- Steve, Hereford
What a vote buyer from the smoke and mirrors man. I guess this will eventually come from the middle classes pockets AGAIN!
- Fly, london
