A Graduate Tax is a Bad Idea

But not because of the argument Iain Dale makes here:

Just a thought on the graduate tax. We already have a graduate tax. It’s called income tax at 40 per cent.

This is an off-hand comment, sure, but it would also be a better argument if it were true. There are about 31.7 million taxpayers in Britain; only 3.8 million of them pay any tax at 40%. I’m all for widening tax bands to take some people out of higher tax rates but there are millions of graduates who don’t earn enough to pay higher rates of tax.

Nevertheless, the belief that everyone pays tax at 40% is a constant feature of press and metropolitan opinion. Hence too the sound and fury generated by Inheritance tax or Vince Cable’s so-called “Mansion Tax” which receive extraordinary amounts of attention even though they only pertain to a (relatively) small number of people.