Good for Ben Gummer, the MP who first floated the idea of personalised tax breakdowns for everyone in the UK, which was turned into a budget winner by the Chancellor today. These breakdowns will show how much an individual has spent in income tax over the year, and will demonstrate exactly where that money has been spent, from the NHS to education to defence. Mooted in the pre-budget last year, these plans look set to become a reality next year and should be very much welcomed.
As George Osborne said himself: “It is quite right that people know how much tax they pay and what it is spent on”. Hopefully Gummer’s initiative will address some of the inertia and mis-understanding that your average man on the street suffers when confronted by anything to do with tax.
As with all politically initiated plans there may be a more crude reason for our Chancellor to push this through. Many sceptics feel it is the Conservatives’ way of preparing the public for as much as £10bn further cuts in welfare spending (or social security as some people know it by) which will be a significant chunk of any tax bill.
So pretty clever really as it could and should work across two counts; improving Government transparency and accountability and therefore engaging and educating the consumer AND mitigating any potential negativity around tax cuts.
My question to George however is, will this work in reality? HMRC are hardly reknowned for their 100% accuracy when it comes to tax records. Also, what will the cost be of implementing this ambitious plan (which in the end the tax payer will pick up)? So, all in all, a good initiative, but one that may not be so easy to progress in reality! Proof will be in the HMRC pudding.