Monday, 12 October 2009

Are the Tories are anti equality?

We all know that the Tories proclaim themselves to be the party of traditional values, but does this mean they are interested in only making retrograde steps when it comes to issues such as gender equality and class divides? A quick look at their proposals regarding tax-breaks for married couples and their views on VAT reveals a shockingly poor understanding of equality issues and makes a mockery of their claims that they will look after the poorest among us.

On tax-breaks for married couples, the Tories are proposing transferable personal tax allowances. This means that where one half of a couple is working, the working half can use the spouses unused tax allowance, thereby increasing take-home pay. This is all fine until the second spouse wants to go to work. If this spouse starts a job earning say £10K, the could find that their take home from this ranges from £5K to as little as £4K, equating to a possible tax of about 60%. In modelling the effects of such changes the Institute for Fiscal Studies (IFS) has shown, unsurprisingly, that this is likely to lead to women being disincentivised from joining the workforce resulting in more women staying at home. Why would anyone be rushing to start a job if the thought they could be taking home only 40% of their pay?

The IFS goes on to show that these changes would be most favourable to wealthy, child-free couples while hitting hardest poorer married couples with children. Not forgetting of course that unmarried couples are indirectly penalised.

As ever, the Tories are reluctant to increase income tax (although not ruling it out). Instead they are planning to increase VAT to around 20%. Of course, this equates to a flat tax and who do flat taxes affect most? That's right, the poor. To be fair, flat-tax systems are known to increase economic output, but the downside is that inequalities are amplified.

So, if you've been thinking, "hey, the Tories aren't so bad" or "that Dave Cameron really does care about the poor", then think again. Even while being cagey about many of their policies the Tories have still managed to publicise the above, which reek of inequality; imagine what they'll do when they get into power and no longer have to worry about scaring the voters.

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