Paying Taxes

John Redwood’s proposals on cutting red tape have already come in for a lot of criticism. But his core convictions are right. People need to take back control of their own lives, and make decisions for themselves. Businesses need to reduce their running costs to drive sustainable growth. The government needs to step back from micro-managing and codifying every aspect of our behaviour, our society and our lives.

When Labour bays about ‘Tory cuts’ we should remember just how far the tax burden has risen in the last ten years. There needs to be a serious debate about what we as a society expect the state to do and what we are prepared to do ourselves. But that cannot happen unless we as citizens are able to see exactly how much tax we actually pay, and we can’t do that under the current tax system.

I think I’m fairly money-savvy but I have absolutely no idea what my marginal tax rate is, and for me, one pre-requisite of an open and transparent government is that it’s easy to find out how much I hand over to it in tax. In return for my taxes I expect a certain level of public services. I liked George Osborne’s idea of a government website detailing all government spending over a certain level. I think it’s a good start in the direction of straightforward government.

At the moment, there is a (fairly unthinking) consensus on what the government provides with taxpayers’ money (and let’s call a spade a spade – it’s not ‘investment’, it’s spending). That consensus could only be challenged if we could all see what we’re handing over each year, so we could judge the value for money that we as a society receive. We could also make the decision on whether we want to continue funding some of the things the government currently does. The automatic reflex at the moment is to ask the government for money. In the end all that money comes from us – it’s not the government’s. But until we have transparency, we can’t really have a mature debate on tax.

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