I find myself rather bemused by David Cameron’s pledge to not increase key taxes for five years (report, 29/04/15).
The General Election is increasingly becoming a place where economic reality has been suspended. On one hand we have the SNP proposing that Scotland’s deficit, one of the largest in the western world, can be reduced via “Full Fiscal Autonomy” in a manner which involves no difficult decisions or pain for anyone. Now David Cameron tells us that the UK economy can be balanced without tax rises. Indeed, his commitment to raise the higher rate tax band is actually a tax cut for those lucky enough to be earning over £42,385.
Fortunately, the independent Institute of Fiscal Studies (IFS) has assessed both of these pain free economic models. They found that the approach used by both the SNP and the Tories can only result in huge cuts in public services or tax hikes. Now that David Cameron has ruled out tax rises, we know what the Tories plan for public services. However, real questions remain regarding how the SNP will balance the books.