(Original post by JPKC)
Okay, this is far more reasonable than I expected (though that's not saying much), one or two provisions it contains strike me as sensible. Others... well... I'm in the Socialist Party, what else can I say? Firstly, I agree with Paddy that it just looks silly to spout off about how the budget deficit is down to the previous Labour government; it's 2012 and each party have now experienced office during this period of economic depression so perhaps we can falsely stop attributing it to each other? (Well, that said, I do believe that the austerity drive has severely retarded efforts to shore up economic growth. As you mentioned, the construction industry, one part of the economy responsible for employing a large chunk of the workforce, could have been easily stimulated by reintroducing the Building Schools for the Future programme and putting into place other Keynesian projects.)
Now onto a certain point you make in the preamble to your proposals. " Unfortunately, I will not be able to balance this budget, though I doubt anyone was expecting me to do so." I can't say that I was expecting you to do so, what I can say is that were this a Socialist budget there would be no deficit. We proposed a financial transactions tax earlier this term that would have closed the gap. An economically sensible policy, it would have relieved the country of the current defificit and in years to come provided funds for improving living standards in Britain. Though that's history. The other measure open to you would have been to finally take action against the offshore tax havens that conceal (at a conservative estimate) twenty-one trillion dollars of the world's wealth. We could have also seen more robust action against domestic tax avoidance, and in particular the brand of cronyism that sees companies like Vodafone get off scot-free from paying the billions of pounds worth of tax that they owe the country.
Instead we see a Budget Report professing to value "simple taxes" presiding over the biggest, most complicated, labyrinthine web of local income tax - a policy that sees areas with higher service costs having to charge their often poorer denizens for running the public services that they are reliant on. The local authorities with the lowest wealth are those that have to charge their people most under this system, and all those on the left resent that. It makes tax avoidance incredibly simple as changing one's domicile to skip paying for services can be done on a county-by-county basis rather than on the international scale that we see in the real world.
For instance, the people that make their money out of London are more than likely to live in neighbouring local authorities to those of the city. The leafy home counties, the commuter belt. These suburbans will use the transport network to enter the economic activity zone, and then make their money from working there. And yet the people paying for the services needed to maintain the conditions for high activity are those stuck in the innercity themselves without benefiting from it. Local levies are unfair and this Budget only increases reliance on them through the dropping of transport to the local level.
Its nice to see that you managed to sneak in a flat tax. As you could probably guess, I don't think it's right to have a situation where your local shop pays the same percentage of Corporation Tax as a massive conglomerate. It's anti-small business and a regression from the current system, which is already very flawed.
The income tax proposal for a tax on the rich is an improvement on the current set of rates but still far from what I would consider ideal as, well, it perpetuates the local income tax which as I've said is likely incredibly unfair. Locally-set taxes have been shown to be perceptible to a number of problems that nation-wide taxes aren't. You only need to look at the situation with the public finances in California to see this. I don't believe that councils that are often elected on turnouts of 30% should hold any powers over taxation, nor do I believe giving them such a power would boost turnout amongst any people other than those that would benefit from cutting taxes. We need to see a return to a national income tax.
I don't at all agree with the idea that fuel duty should be cut. The Carbon Tax Act raised it by fifteen percent and I completely believe this figure should be made to increase steadily rather than face gradual snips to appease the short-term interests of a consumer's bank balance.
Abolishing VAT is a good move and it'll have my support provided you don't mash the proposal in with the other nefarious intentions.
Finally, I disagree with the massive cuts to the bureaucracy. They will just serve to make the government even less effective at handling all of the responsibilities it is committed to; were they feasible I sincerely believe that real-life governments would have acted on them. That sentiment deals with most of the cuts, to the ones specifically made in the Home Department I believe that they are perhaps partially justifiable (though it should be noted that I vehemently oppose the Narcotics Act) - what I would say is that there are plenty of useful things law-enforcement agencies could be getting to grips with, eliminating one of these problems doesn't mean the others disappear as well. Drug-related crime may have evaporated but I'm damn certain rape is still as prevalent and ill-handled as ever. The cuts to Government go too far and this Budget, I feel, doesn't adequately inform MPs of the many functions that will be lost.
The Budget Report as a whole is very well done, and (although I'm sorely disappointed by the lack of pie charts) I commend the Chancellor for his efforts. One thing I'm confused about is the projected increase in RI payments - how will this come about?