This weekend Ed Balls made it clear he wants to tax Britain more.It won’t stop at 50%, and it wont be confined to the highest earners over 150,000. In that sense low tax Comservatives have much to thank Ed Balls for as he really has set out clear blue water between Labour and the Conservatives for the next election.
Nevertheless, let’s not celebrate too quickly. Labour will know, and as Ed Balls all but acknowledged on the Marr show this weekend, that this tax commitment is little to do with economic policy and more to do with their own electoral strategy. A 50% top rate of income tax will raise little extra money if any at all. The HMRC calculates that at best 100 million, at worse it produced a negative effect on tax receipts. So why do it?
Simple.
Labour only need 35% share of the popular vote to win a majority, and appealing to a left wing sense of perverse morality by fleecing the high earners is a pretty good way to shore that vote up.
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