Over to you Mr. Osborne
The big announcement in this morning speech from Ed Balls was that a Labour government would reintroduce the 50% tax rate which was reduced to 45% in George Osborne’s March 2012 budget.
This is probably the most significant policy move yet from Labour in the build up to GE2015 – now little more then 15 months away.
At the time of the change to 45% Osborne’s move didn’t poll very well and there’s little indication that public opinion has moved that much since.
A challenge for the Tories is that whilst there maybe an argument that lowering tax rates increases the overall tax take this is a hard one to get across. It is hard to see political slogans based on the “Laffer curve” resonating.
Labour’s clearly hoping that this both deals with the “where will you find the money” question as well as reinforcing their case that the Tories are the party of the rich governing for the rich. This is a view that is fairly deep-seated as has been seen in poll after poll.
The Osborne/Cameron strategy is to paint Labour as being the party that caused the problems in the first place and their key message will be to warn of the risks of changing with the economy now moving upwards.
The period when the Tories were most deeply in trouble during this parliament was in the aftermath of that March 2012 budget. Every little measure from the “grannytax” to the “pastytax” was contrasted with how the rich were being treated and the blues struggled for months.