According to the 17th century French finance minister Jean Baptiste Colbert, “the art of taxation consists of so plucking the goose to obtain the largest amount of feathers with the least amount of hissing”. Little wonder that Britain’s Chancellor is “often complimented on his skill at this art”, said Eamonn Butler in The Business. Gordon Brown has proved adept at keeping headline tax rates down, while cheekily deploying less obvious “stealth taxes”. But he can’t avoid the truth of Tax Freedom Day – the moment in the calendar year when the average citizen has in effect worked long enough to pay their taxes and “can at last start working for themselves”. It is a deliberately “crude” measure of the total tax burden as a percentage (now at 42%) of net national income. This year, the big day fell last Sunday, 30 May, a full three days later than last year, and six days later than when Labour came to power in 1997. And if you add in all Brown’s extra borrowing (which is really just deferred taxation), tax freedom day is pushed to 11 June. Even the most cunning Chancellor cannot escape from the simple clarity of this statistic: we are paying more tax under Labour.
In America, things are going in the opposite direction, said Jeremy Warner in The Independent. Tax freedom came on 11 April, the earliest for 37 years. Granted, the Bush administration’s controversial tax cuts go hand in hand with a Budget deficit of “truly reckless proportions”. Yet low taxes are still a demonstrable driver of competitiveness, which is why the UK’s growing tax burden is so alarming. The effect of rising tax and regulation is cumulative: eventually, “there will be a tipping point in perceptions when Britain could quite quickly lose its current appeal as Europe’s most exciting business economy”. And a similar crunch is coming in terms of domestic politics. Up to now, people have been reasonably sanguine about Labour’s stealth-tax rises because we have benefited so much from low interest rates over the past few years. Now that rates are rising again, that will change.
The only other thing that might have kept voters sanguine was evidence that their hard-earned money was being well spent, said David Smith in The Sunday Times. But, despite massive investment in health and education, polls show we are sceptical about how extra cash is transforming these services. Some statistics give a picture the Government likes: the plethora of new hospitals and schools that have been built, a cut in doctors’ waiting lists and a rise in the number of pupils achieving five good-grade GCSEs. But other data tell a different story: a 20% rise in NHS funding has led to only a 2% increase in treatments. Worse still is productivity, which has fallen by 15% in both health and education since 1997.
And it is this lack of efficiency that has failed to change perceptions, said Eamonn Butler in The Business. Take Britain’s “flagship” National Health Service, whose budget has been boosted by 50% in real terms to an astronomical £60bn. The average waiting time is still 49 days – six days more than in 1999, before the extra money started pumping in. Yes, there are 16% more doctors than there were four years ago, but 45% more managers are “getting under their feet”. All in all, said The Daily Telegraph, given the minimal improvements in public services, this Labour Government has proved “rather bad value for money”. All those who can’t wait for Brown to be PM should remember just who is responsible for the biggest tax-and-spend spree “in peacetime history”.