by Christopher Hounslow

Created on: April 11, 2009   Last Updated: April 18, 2009

The tax laws of the United Kingdom have developed over time organically, rather than being a single piece of legislation. This has a distinct advantage for politicians; they can tinker with parts of the tax system without having to overhaul the whole policy. Therefore, when the governing party sees an opportunity to enhance its standing with the electorate by changing a tax policy, it takes full advantage.

Let's take the current tax on flights as an example. The current flight tax or Air Passenger Duty' is 10GBP for a flight from the UK to an EU destination country. Now, if you are a family of four heading out to Spain for your annual fortnight's holiday, an extra 40GBP is probably not going to stop you from making the trip. Yet when introduced, the tax was heralded as a green tax'; it was going to cut down carbon emissions, and hence help save the planet. With the current environment of voters' interest in all things green, it can be seen why a tax like this may be popular and thus further the likelihood of a government being re-elected. But does this tax enhance the public good? The answer is most likely no. For the majority of people who don't go abroad very often, the tax will make little or no difference to their lives, and as previously mentioned, the level of tax is not enough to make regular air travellers stop and think, let alone change their travel plans. The only way that such a tax would really enhance the public good would be to make it so punitive that people would seriously consider other options to flying. But a government that taxed foreign holidays out of the affordability range of the average citizen would face a huge political backlash, not least from the airline industries.

A similar case can be made for the taxes on tobacco. In the 2006/07 financial year the government raised approximately 10 billion GBP in tax from tobacco sales. The government constantly tell us that smoking is bad for us and that we should stop, which is true. Yet do they really want to lose that volume of revenue? I would suggest not. It would be for the public good if smoking were to be made illegal (I am a smoker and I still believe this) yet the political outcry from banning smoking, or taxing it so heavily that only the very wealthy could afford it would be devastating. So the tax on cigarettes is increased in small increments, so keeping smokers, manufacturers and retailers on the governments' side.

Can political self-preservation and the public good be reconciled in terms of tax policy? I believe it can, but it would need a radical solution. Repeal all current tax laws and replace them with a single, unified policy, and hence law, that doesn't penalise pensioners, the less well off, or those aspiring to better themselves among the community. Ensure that tax spending can be seen to be spent on the things that matter to the ordinary citizen, and not on bureaucracy and red tape. It would take an extraordinarily brave government to do such a thing, but they may just find that when the electorate really sees that their hard earned taxes are being spent on the things that really matter to them, they may also find that their political self-preservation is also enhanced beyond measure.

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