The Tories will be desperately tempted to vigorously oppose the new 45p top rate for those earning more than £175,000. But this is just what Brown wants them to do–as Fraser pointed out this measure has far more to do with politics than raising revenue. Brown is hoping to create a situation in which the perception is that he is trying to save the economy while the Tories are just trying to protect their rich friends. Yes such a narrative is rubbish, but it could be politically potent. Falling that, Brown is trying to provoke a Tory split; hoping that Tory backbenchers will demand that the leadership oppose it at all costs. Brown knows that there are still few things the press likes more than a Tory splits story.
It would be much better for the Tories to concentrate their fire elsewhere. The strategic leaking of this news tonight—whatever happened to Brown’s promise that announcements would be made first to Parliament not the media?—suggests that there are far more sweeping deferred tax increases to come in the PBR tomorrow. Opposition to the dangerous level of debt and to these should form the centerpiece of Osborne’s response.
The Tories mustn’t let Brown box them in to a position where they can be caricatured as defenders of the privileged rich. Already there is a danger that if the Tories oppose Labour’s plan to cut VAT, Labour will respond by claiming—disingenuously—that the only tax the Tories want to cut is inheritance tax. The Tories should merely say that they’re minded to oppose it, and that the need for it is an indictment of Labour’s fiscal incompetence and incontinence, but they can’t tell you whether they’ll need to create a new top rate yet as they haven’t seen how much damage Brown will have inflicted on the public finances by 2010.
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