Ladies and gentlemen, should you be up and around at this late hour on a Sunday night, I would like to point out that the UK Libertarian Party's policy will be appearing here at one minute past midnight. You'll like it, we hope...
UPDATE: here it is.
The UK Libertarian Party has started the new year with a call to scrap personal income tax.
Party Leader, Patrick Vessey, said,"Income Tax raised £143 billion in 2006/07, about one quarter of the £534 billion spent by government last year.
"But savings on unnecessary spending could easily be found: for example, current annual spending on Britain's hundreds of unaccountable QUANGOs—including such patent time-wasters as the British Potato Council, the Milk Development Council and the Wine Standards Board—is running at around £175 billion.
"The Libertarian Party believes that the tax burden should be substantially reduced, and that those taxes that remain should be levied on spending, not on income. This policy will reward those—especially the poorest—who spend within their means and who save for their future."
The Party's Director of Communications, Chris Mounsey, added,"This may seem like pie-in-the-sky but, in 2001/02, the government spent £378 billion. Were we to return to those spending levels, we could abolish personal income tax and still have £13 billion left over—sufficient also to abolish, at current revenue levels, Inheritance Tax, Capital Gains Tax, and duty on beer and wine.
"The people of Britain are beginning to understand that simply throwing money at public services doesn't work. The Libertarian Party is dedicated to allowing every person in this country to choose how their hard-earned money is spent – and the best way in which to do that is not to steal it from them in the first place."
The Libertarian Party's pledge to scrap personal income tax is the first policy to emerge from the new party's discussions, and will form part of a radical manifesto to be released later in the year.
Notes for editors
- The Libertarian Party was founded on 21 November 2007 and officially launched on 1 January 2008. The party has to date concentrated on building support amongst UK political bloggers; this is the party's first foray into the wider world. The party's website can be found here, and fuller details of this proposal are available here.
- Libertarianism is a political philosophy based on support for individual liberty.
- Libertarianism is a broad church, but the UK Libertarian Party is broadly minarchist in outlook.
- Government spending figures can be found here [Excel file].
- Income Tax was first introduced in 1799, at a starting rate of less than 1%, by William Pitt the Younger, in order to buy weapons and materiel to fight the Napoleonic Wars. A brief history of the tax can be found at HMRC.
- The QUANGO database
- The Essential Guide to British QUANGOs 2005.
EDIT: There is an article detailing more of the thinking behind this policy—once income tax has been abolished, wouldn't it be a very brave government that reintroduced it?—and a general manifesto too. The first newsletter can be found here.
There have already been murmurings that this policy might lead to us being painted as crazy people but the point that we are trying to make is that people should be thinking radically. And nor should this policy be thought of in isolation: let's face it, we are going to have a long time to plan and fine tune our policies...!
Income Tax seems like a fixture—something that has been around since the dawn of time—but the truth is that it has not. It was introduced in order to raise money to fight a major war and even then was only levied on the very rich (it started at 0.83% on those earning over £60 a year: a considerable sum in 1799).
Over the decades, governments have forced more and more people into the embrace of Income Tax, mainly by not raising the Personal Tax Allowance. Even in the 1950s, the average worker didn't pay Income Tax; it is only as the state's ambitions have got bigger and more all-embracing that Income Tax has come to affect nearly 100% of the working population.
And you want to reward those who work, and encourage others to do so? Fine: don't tax people for doing what you advocate (unless, of course, you are a big state socialist and the only interest that you have in getting people into work is so that you can tax their earnings).
Think about it: why the hell should the state intrude on your privacy in this way? Why should you have to tell the state how much you earn? And why, in the name of all that's unholy, are we taxing those on the minimum wage? In fact, why the hell are we still taxing those who work part-time on the minimum wage?*
According to the aphorism, there are only two certainties in life: death and taxes. OK, there's not a lot we can do about the former, but let's think about how we can substantially reduce the latter.
* Standard working week is 40 hours, and so I am taking part-time as 20 hours a week. The minimum wage is £5.52 an hour. 52 x (20 x 5.52) = £5,740.80, which is above the Personal Tax Allowance of about £5,350. OK, the tax is a negligible amount but, then, it's a derisory income. And think how many resources are consumed in order to collect the £78 or so income tax on that wage. Do you reckon that it is higher than the tax collected?
UPDATE: both Bishop Hill and Bag seem to like this policy.