"WHAT is he thinking?" In hushed huddles around Westminster, MPs, advisers and journalists are exchanging theories as to why George Osborne is even contemplating a reduction or abolition of the 50% top rate of income tax in Wednesday's budget.
Even those who would cheer such a move admit that it risks entrenching the Conservatives' image as the party of the rich. Since inaugurating the age of austerity in 2010, the chancellor of the exchequer has imposed a public sector pay freeze, signalled an end to universal child benefit and tightened spending across government. In these circumstances, a tax cut for high-rollers (the 50p rate kicks in when pay crosses a threshold of £150,000) would be provocative - and surprising from this most politically vigilant of chancellors. The rate was set as a trap by the outgoing Labour government, so why walk into it?
Read Full Article »