13 February 2012

No reprieve for the middle classes

Middle-class families face a battering in next month’s Budget after the Chancellor ruled out major changes to his plans to slash child benefit payments to higher earners. The Conservatives and Lib Dems will hold crunch talks this evening on a Budget that is expected to pave the way for tax raids on the better-off that will continue until 2015.

George Osborne is set to ignore Conservative calls to axe the 50p top rate of tax, and has angered Tory traditionalists by making clear he will not introduce tax breaks for married couples in his speech. The expected assault on the middle classes has provoked claims from Tory MPs that ‘the Liberal Democrats are writing the Budget’.

The Conservatives’ coalition partners are also calling for pension tax relief to be slashed from 40p in the pound to 20p for those earning £100,000 or more – a move that could raise £3.7billion. In addition, they are expected to demand new green taxes to help speed up the increase of the minimum tax threshold to £10,000. The Chancellor already plans to strip more than £1,000 a year in child benefit payments from every family that has one earner paying the 40p higher rate of tax. (Daily Mail, 13 February 2011)

As we have observed before, the unspoken principle underlying tax and benefit policy is that resources should be transferred from populations with higher average IQs to those with lower average IQs.

The population which pays higher-rate tax because it has higher earned income (so-called ‘earned’ ‘taxable’ income is income which is not derived from benefits nor from the moonlight economy) has a higher average IQ than the population of those who do not pay tax at this level. So it is obviously considered correct procedure to cut ‘benefits’ received by the higher-IQ population. This increases the proportion of ‘benefits’ received by a population with a lower average IQ, and will encourage the proportionate growth of the low-IQ population.

Even quite a small percentage increase in the relative growth of one population vis-à-vis another population, continued over time, soon has a perceptible, and perhaps dramatic, effect on the relative proportions of the two populations.