(UK) A chancellor in his pomp: emboldened George Osborne eyes budget day

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http://www.theguardian.com/politics/2015/jun/25/a-chancellor-in-his-pomp-emboldened-george-osborne-eyes-budget-day



It may be the seventh Osborne budget, but Treasury insiders are already calling it his first Conservative one – with a £12bn welfare cut at the top of the list

A chancellor in his pomp: emboldened George Osborne eyes budget day
Heather Stewart
Thursday 25 June 2015 14.08 EDT

George Osborne will stand up to deliver his budget on 8 July as a chancellor in his pomp: freed of those pesky Liberal Democrats; emboldened by the Tories’ decisive victory at the ballot box; and invigorated by the prospect of a job vacancy at No 10. It may be the seventh Osborne budget, but Treasury insiders are already calling it his first Conservative one.

We can be all but certain that he will spell out a long-promised £12bn cut in the social security bill. He should also make good on a series of manifesto promises. Those include an increase in the personal allowance and an extra inheritance tax allowance for property, so that families can pass on estates worth up to £1m, tax free. There is also an aspiration to increase the higher-rate income tax threshold to £50,000.

Stripped bare, this already looks not just fiscally conservative, but highly regressive. The pain of £12bn welfare cuts is likely to fall predominantly on those at the bottom of the income scale, while the winners from the tax cuts are at the top.

Even the continued increase in the personal allowance, originally a Lib Dem policy, now mainly benefits middle and upper earners. As the Institute for Fiscal Studies pointed out during the election campaign, more than 40% of workers already earn too little to pay tax.