The Conservative party and the Taxpayers’ Alliance have always had a very close relationship. The appointment of Isaby as Political Director, apparently responsible for ‘building links with Ministers, MPs and MEPs’, means the partnership will become cosier still.

This appointment brings to mind an occasion in 2006 when I visited Conservative Central Office at its former residence in Victoria Street. During the meeting, our group were informed by Mark Clarke, who was then the pompous Chairman of Conservative Future, and Ian Oakley, at the time a Conservative candidate in Watford, that the newly formed Taxpayers’ Alliance were simply a front organisation set up by the Tories to attack Labour on tax.

The ‘brilliant idea’, so we were told, was to create a separate organisation that could attack Blair and Brown on economic issues, meaning the Labour party, BBC and print media couldn’t just dismiss the complaints as being irrelevant because they had come from the Conservatives.

I even recall mention of how the organisation was to be funded by existing donors to the Tory party and indirectly, the Conservative party itself. At the time I wrote a blog entry on my website making note of a few of these remarks on the TPA, and criticised Mark Clarke and Ian Oakley for being slimy and insincere. Not long afterwards Clarke contacted me by email to ask that I withdraw the article, not, so he said, due to the personal criticism, but for revealing matters about the workings of the TPA at a private meeting in CCHQ. Naturally I refused, and that was the end of the matter as far as I saw it. Furthermore, in subsequent years my observations on the disgraceful Ian Oakley were rather vindicated by events.

Thus, from its inception, the Taxpayers’ Alliance existed as a Conservative sanctioned group used to indirectly assault the Labour administration over their economic incompetence, high tax policies and runaway spending habits. Of course, now that Labour are no longer in office and the Tories (and Lib Dims) have replaced them, the situation has somewhat changed.

In 2006 we had TPA reports on ‘The Real Cost of Gordon Brown’ and ‘Moving Britain Backwards’ – the latter claimed to ‘tear apart Gordon Brown’s economic record and shows how Britain’s economy has become less competitive and less able to meet the coming challenges’. Likewise, in 2008 we had ‘Gordon Brown’s Economic Failure’ and ‘Brown’s Borrowing Will Be Double The Debt Needed To Win World War One’, which, in Daily Mail-esque language, had William Norton stating:

British taxpayers enter this downturn like lions led by donkeys. Not only will full recovery take twice as long as the First World War lasted, but we are going to take on twice as much debt. Alistair Darling is sending the taxpayer over the top to face a financial Battle of the Somme.

However, since the general election the Taxpayers’ Alliance has been rather muted in their criticism of the Coalition – unsurprising given their origins. Under George Osborne the ‘official’ national debt has increased from £700bn to what Christopher Booker mockingly called ‘a much more manageable £900bn’. Where therefore are the regular TPA proclamations denouncing excessive Government debt as there were under Gordon Brown?

Likewise, where are the TPA talking heads on the BBC and Sky condemning the Prime Minister for increasing taxes and hiking governmental spending? It has all gone eerily quiet – particularly when you consider that the Coalition has increased taxes, increased the national debt and given away even more money to the IMF and EU than before.

Should the TPA ever overstep the mark and lose its special Tory stamp of approval, then it is unlikely the organisation could support itself for too long. At the moment it is a rather wealthy group, taking in over a million pounds in donations and managing to employ quite a few highly paid staff. It dare not bite the Tory hand which feeds it lest those generously charitable gifts dry up.

Similarly, the Conservative party to some small extent needs the Taxpayers’ Alliance. As one of its ‘approved’ partners, party donors and supporters may be encouraged to give money, resources and time to it, with Dave and company safe in the knowledge that it will be funnelled up a blind alley rather than spent on anything that may meaningfully change Britain.

This is not to say that the TPA is entirely useless in absolutely ever report it writes or campaign it runs. As Helen Szamuely remarked:

In the past my comments about the Taxpayers’ Alliance (TPA) have been mixed. Sometimes they do good work, sometimes it is a bit shoddy and their habit of not crediting anyone with previous research is annoying.

But, the point is that they are far too close to the Conservatives to be of any real, long-term worth – and the appointment of the likes Jonathan Isaby, who is seen as a ‘safe pair of hands’ by the Tories, confirms just that.

He noted that while rich individuals such as Bill Gates and Warren Buffett declare that the wealthy should pay more in tax, then they do not practice what they preach. Indeed, he says, Barack Obama falls into that category, earning considerably more than the average American:

If Obama is in earnest about wanting increased taxes on the wealthy, then he should send the United States Treasury $182,998. That’s the difference between his Form 1040 Line 60 (“This is your total tax”) and what he would have owed at the higher rate (plus limits on itemized deductions) he himself advocates.

So why doesn’t he tax himself more? The Form 1040, after all, only stipulates the minimum tax an American must pay. More is always welcome. Obama should write a check to the United States Treasury for $182,998.

This very much reminds me of a local debate that I attended just before the General Election. During questions from the audience, a local Methodist Minister stood up and declared that he had earned £18,500 for the previous financial year. He was happy to declare this he said, and had even brought his documents so he could tell us exactly how much tax he had paid, which he then duly listed.

Later, when he eventually got to the point (funny isn’t it how during questions from the audience, more often than not, those who raise their hand seem to feel the incredible urge to give us their long winded opinion rather than actually ask a question?), he said that he was very happy to pay that tax and he got good value for it. He went on to say that he wished he paid even more tax and would be happy to pay it for such excellent public services, etc…

That was his opinion and while I do not share it I did not have a problem with him expressing it in the public forum. My immediate verbal suggestion to him was that he make a voluntary donation to the Treasury. No doubt it would be well spent on some worthy cause I told him. This he did not like.

Furthermore, what he rather failed to mention to the audience was that he lived largely rent and bill free in accommodation at the expense of the Methodist Church. Therefore, his supposedly ‘low salary’ as he said, was not quite all it seemed. How convenient.

Our Methodist friend, Barack Obama and much of the Left are made in the same mould. When they say that they would like to pay more taxes, what they really mean is that everyone else – or usually and more specifically those wealthier than themselves – should pay more tax. In a speech in April, Obama said:

Some will argue we should not even consider ever, ever, raising taxes, even if only on the wealthiest Americans. It’s just an article of faith to them. I say that at a time when the tax burden on the wealthy is at its lowest level in half a century, the most fortunate among us can afford to pay a little more. I don’t need another tax cut. Warren Buffett doesn’t need another tax cut. Not if we have to pay for it by making seniors pay more for Medicare. Or by cutting kids from Head Start. Or by taking away college scholarships that I wouldn’t be here without and that some of you would not be here without.

Thus, in reality it all boils down to the size of the state – one of the real divides between Left and Right, socialist and conservative, or however else you wish to define those opposites. It is not so much an issue of tax, but of how many people the state should employ and the functions it should perform. Tax becomes the battleground, rather than the issue itself.

When Obama says that it’s ‘an article of faith’ to those who wish to keep taxes low, then the same could be said of the Left not wishing to reduce the size and scope of the state. The vast debts most Western economies have incurred have been borrowed precisely to facilitate massive increases in the state’s reach into all aspects of our lives. The state has, and always will be the means by which the Left attempt to reshape society.

Friedrich Hayek, wrong about much, was correct when he suggested that state socialism leads to totalitarianism. Even in the face of this mountainous national debts, the Left in most countries are loathe to reduce public expenditure, instead favouring increases in taxation to use the crisis to further the advance of the state.

By holding out against tax rises, and pushing for tax reform the Republicans in the United States are therefore actually doing what oppositions are meant to do, which is oppose the Government – unlike the Conservative Party before the previous set of elections or currently the Labour Party. Such opposition is necessary, even if it means running the risk of a U.S. default – which seems increasingly likely regardless of Republican actions.

The BBC is reporting that the Liberal Democrats are going to drop their pledge to cut the overall level of tax at the next election. This, I think, is significant because it now means that none of three major political parties in Britain will be promising to reduce the increasingly crushing burden of taxation placed upon the British electorate at the election next year.

Our political class from all parties have conspired to remove any semblance of electoral choice over this highly important issue. If you believe that the tax burden should be cut, as millions of British voters do, then you are now left completely unrepresented by any political party that has a chance of forming a Government.

Furthermore, the usual excuses that party spokesman predictably parrot about how cuts in taxation are somehow ‘implausible’ or ‘irrational’ during the current economic climate are left completely uncontested. They never explain why such high levels of taxation are ‘rational’ or why it is right that the Government and state should waste so much of our income on frivolous pursuits and egotistical political projects.

The real reason why none of our political class will advocate any other alternative to what already appears to be the status quo is that they either genuinely support ever higher levels of stifling taxation, or that they have become so intellectually lazy that they have chosen not to make the case for a less expensive state.

When politics has been reduced by the political and media class to being about personalities rather than policies, should we really expect any different? Once again we have been given no choice.

This obvious reluctance is why so much ambiguity surrounds the issue and why the party leadership will not, if they can help it, be pinned down on the matter.

In late 2007 it became clear that Gordon Brown was readying the Labour party for a snap election. At the Conservative conference in Bournemouth there was an atmosphere of worriment and discontent. Opinion polls were consistently showing that the Conservatives were many points behind Labour when they needed to be quite a few points in front, and that as a result they were likely to lose any coming General Election.

Defeat would have condemned the Conservatives to another five years on the opposition benches and made it an unprecedented fourth election defeat in a row for a political party who were once considered the ‘natural party of government’ in Britain.

At that time the Cameron project was still very much a work in progress. In many ways it still is. However, before the party conference in 2007, David Cameron had seen little success in actually attracting the wider electorate to vote Tory. Despite all the hoodie-hugging speeches (okay, so he never actually said that) and pledges that marriage could, in his view, be between a man and a woman, a man and man, and a woman and a woman – the electorate were still not all that interested.

The liberal metropolitan elite whom the Cameron project had initially targeted with such vigour had merely shrugged their shoulders and continued supporting Labour or the Liberal Democrats. They no longer really hated the Conservatives under Dave (because the Conservatives no longer stood for conservatism), but this certainly didn’t mean they were going to vote for them either.

Meanwhile, those who were once considered to be the socially conservative ‘working class’ and who are now affected by the grinding drudgery of crime and increasing moral poverty were none too impressed that the Conservatives would try, like the Left, to ‘understand’ crime as if it were some sort of social disease, rather than treat it as what it actually is – an unpleasant measure taken by the greedy and selfish.

Therefore the Conservative party was not increasing its electoral base and the party’s independent polling was showing that what was considered to be the core Conservative vote were certainly not enthused by Mr Cameron’s socially liberal, ambiguously high tax, big-state approach to a future Conservative Government.

With Gordon Brown having just become Prime Minister in June of that year and gained a resulting polling bounce, the Conservatives were quickly learning that just because millions of voters had voted Conservative in the past didn’t mean they would do so again – especially if they were not given any incentive. In addition the party were not picking up many votes from electoral dissatisfaction with the Labour Government.

With defeat staring Cameron and his leadership team in the face, and in a desperate attempt to limit their election loses, he and his advisers rushed to introduce a policy at conference that they thought would prove popular with their core vote.

As predicted, the new policy on inheritance tax was popular with many Conservative voters. However, as it happened, after more than a decade of repressive levels of taxation under Labour, many non-Conservatives voters were also fed up with seemingly ever higher tax bills and they grabbed onto this policy fig leaf of raising the inheritance tax threshold in the hope that a Conservative Government would provide more tax relief.

It would be fair to say that that one policy saved David Cameron’s bacon and that as a consequence of the swell in support for the Conservatives in opinion polling, Gordon Brown called off the election that he had been planning to hold.

One might have thought that would be the end of it all. The pledge to raise the inheritance tax threshold had been made, and this would be carried out if the Conservatives managed to form a Government at the next election. Unfortunately this does not seem to be the case and David Cameron, with the help and support of Ken Clarke and his Shadow Cabinet, is trying to wriggle out of that seemingly solid commitment.

David Cameron and the Conservative party are now in a wholly different position. They are consistently ahead, by some distance, in the opinion polls (though I really can’t see them winning a General Election by the margins predicted) and as time has gone by Gordon Brown has become an increasingly unpopular Prime Minister. Furthermore, the economy is disappearing ever further into recession and millions of people find themselves out of work, often with very little prospect of employment in the short term.

The upper echelons of the Conservative party therefore feel that they can renege on the inheritance tax pledge which they had never wanted to give in the first place. They know from their independent polling that there will be a large anti Labour Government vote at the next election, and they believe that their core vote will be enthused enough by the prospect of removing Labour from office that they will come out and vote Conservative regardless of what policies the party are actually advocating.

On this basis they also know that they do not need to make any further concessions to actual conservatively inclined voters, and that they can now rather conveniently change the terms of their pledge on inheritance tax knowing all too well that the party will not electorally suffer for doing so in the polls.

David Cameron and those who currently control the Conservative party are not ideological. They are perfectly happy to copy New Labour’s taxation and spending habits (or be completely ambiguous and not have a policy at all) because they don’t have any plans or ideas of their own. Come the next election, if the Conservatives somehow manage to win a majority of seats in the Commons then there will be a change of faces but without a change of policies. These days in Britain, whoever you vote for, the Government always gets in.

Despite the fact that our Westminster Labour Administration would not be particularly favourable to such a plan – at face value it sounds like a good idea, doesn’t it? Well sadly it’s not – and here’s why, as Dr Richard North kindly explains:

There are, however, just one or two tiny little problems with this idea. VAT is, of course, an EU tax, implemented via the VAT 6th Directive. A payment holiday on VAT would amount to a de facto reduction in the rate of tax, which is not permissible without the unanimous approval of all 27 EU member states, following a proposal to that effect from the Commission – which it not required to deliver.

That, though, might be the least of Mr Cameron’s tiny little problems. Member states are required under EU law to collect VAT, a proportion of which goes to the EU coffers – known as the ‘own resource’. Collection procedures are also defined by EU law, requiring the imposition of penalties on late payment – typically one percent per month. Changing these procedures unilaterally, guess what, is not permissible without the unanimous approval of all 27 EU member states, following a proposal to that effect from the Commission – which it not required to deliver.

Under certain circumstances, member states are entitled to adopt a simplified procedure for charging VAT, under Directive 2006/69/EC, but that does not include any provision for delaying tax payments. To the contrary, the Directive allows special provisions to enable member states to “prevent distortion of competition,” which rather shows where EU priorities lie.

If these hurdles were somehow to be overcome, however, unilateral action by the UK in offering a tax holiday would certainly be considered a ‘distortion of competition’ under Single Market rules. At the very least, Commission permission would have to be given, which will not necessarily be forthcoming.

And, since Mr Cameron’s proposals affect only small and medium-sized businesses, larger firms might be moved to complain. A company like McDonalds, for instance, would have a just complaint. It regards itself as a ‘group of small businesses’ under one banner. Fighting as it does for market share in competition with other high street outlets, it could argue that different rules on payment would most certainly distort competition.

There is also the matter of state aid. Broad-brush aid – which includes tax-breaks of any form, directed at one sector rather than applied uniformly – would most likely be considered illegal. At the very least, Commission approval would be required, which might not be forthcoming.

Then there is one other tiny little detail. Numerous studies – not least this one – have drawn attention to the danger of deferred VAT payments, making the system even more vulnerable to fraud. This is already a massive problem. Would Mr Cameron want to add to that problem?

David Cameron is calling for something which is practically unachievable. I’m just passing on this important message in case anyone is reading…

The discussion related to the Conservatives’ economic competitiveness policy review headed by John Redwood, and the fact that, unsurprisingly, the Chancellor didn’t agree with the proposals.

In the interview, Alistair Darling suggested to listeners that if George Osborne was going to be a ‘responsible’ Shadow Chancellor, then ‘What you can’t do is sign up to a program which John Redwood has come up with today, which talks about over £21bn worth of cuts without actually saying how you’re going to pay for that’.

As the Chancellor well knows, neither George Osborne nor David Cameron have endorsed the proposals found in the Redwood report (I wish the party had, but the fact remains that they have not).

The Chancellor then went on to add, ‘Because, the only way you can pay for that sort of money coming out the system is by quite savage reductions on things like transport’. Again, as Alistair Darling knows, this is not the case – but to admit so would not suit his and the Labour party’s argument.

During the 1990’s, Labour and the progressives in the media effectively developed the idea within public consciousness that if you exponentially increase spending on public services, you will exponentially reap positive returns. Conversely, based upon this assumption, if you decrease Government spending, public services will suffer because, as this theory also (falsely) suggests, all money spent on public services is spent efficiently and without waste. Therefore, on the basis of these ideas, the logical conclusion appears to be that more public spending is better, and cuts, by whatever means, will lead to decline.

The Left managed to disseminate this idea widely during the late eighties and early nineties due in part to the Conservative party being in a state of political meltdown (from which it has not yet fully recovered) and unable to easily defend or put across their ideas under an almost constant barrage of negative press coverage.

Labour and the Left very much knew that to attack an individual or group is to directly undermine their ideas or indirectly challenge any belief with which that person or party associates itself. This was very pertinently illustrated last week during the BBC’s initial coverage of John Redwood’s Economic Competitiveness, in which embarrassing archive footage of him was broadcast from his time as Welsh secretary, mumbling along to the Welsh anthem. In mocking Mr Redwood, the BBC hoped that some viewers would draw the conclusion that a seemingly foolish man would have equally foolish ideas.

As we know, despite ten years of waste under Labour rule, the NHS, at which billions were throw vaguely in its unreformed and bureaucratic direction, has not noticeably improved. Neither has the postal service or local council rubbish collection, to name but another two. British infrastructure is crumbling and business is become gradually more and more uncompetitive to the extent that firms are moving abroad to find cheaper labour – with cuts in jobs being the main result of high tax and spend policies.

People in Britain are currently crying out for a viable alternative party of Government. This was perfectly demonstrated only recently in the dying days of the Blair era, where once he was finally expelled from office, the public heaved a collective sigh of relief and embraced their new Prime Minister simply because he was not Mr Blair. However, when the public eventually realises (as they will) that while Gordon Brown is not Tony Blair, he is very similar; then that cry for an alternative will renew with increasing vigour.

Yet despite all Labour’s failings that we can point to, for quite sometime there has been no concerted public fight back against their wayward thinking – admittedly a problem when much of it is portrayed as fact by their media mouthpiece the BBC.

Part of the problem lies in the very fact that vast swathes of the Conservative party have not been interested in combating these ideas. There has been no desire to confront the progressive agenda pursued by Labour, and instead just meek capitulation to the seemingly inevitable has taken hold. Instead, the Conservative party has contented itself with trying to fight New Labour (when it has not been fighting itself) on their terms rather than ours. This will be, in my opinion, always destined for failure.

By allowing the Left and Labour to define the centre ground on where they are – which is, of course, on the Left – they will always attack any proposals the Conservative party puts forward as a ‘lurch to the Right’.

If we look to the past, major long-term incoming Governments; most recently and notably those of Thatcher and Blair, made active attempts and were successful in putting forward their ideas in the public arena. The next Conservative Government will be a mere flash in the pan if the populace are not persuaded of the merit of our ideas. In 2007, Britain has not yet undergone that crucial counter-revolution in thinking necessary for a change of government. Perhaps this is because those in charge do not wish to see any radical change in direction. We shall see.

While George Osborne and David Cameron have dug themselves into a hole on the issue of tax; one from which they have no immediate return – organisations such as the Taxpayer’s Alliance have attempted to take up the torch in their stead.

Sometimes, the Conservative party is not always the best vehicle to put forward ideas. It would appear that on the issue of taxation, the party has all but defaulted. Now, it is up to private and independent organisations such as the TPA help make the case for lower taxes, so in periods of electoral decline for the Conservative party (or any other potential conservative, lower tax parties that may exist in the future,) it is less likely that those monetary beliefs will be tarnished and become seemingly electorally untenable in the eyes of the public.

While currently it seems that the odds of outright victory at the next General Election are heavily stacked against the Conservatives; with the steady growth of tax-focused organisations, I am optimistic for the future.

Naturally Labour, with ample help from their colleagues at the BBC have heavily criticised these proposals as ‘a lurch to the right’ – but then they would, wouldn’t they.

The proposals in Mr Redwood’s report suggest that corporation tax should be cut to 25p, that taxes including capital gains should be reformed, and that many EU laws should be unilaterally dis-applied in the UK. The BBC license fee, which Mr Redwood described as an unnecessary ‘poll tax’, also came in for criticism.

The policy review report was broadly welcomed this morning by George Osborne, the Shadow Chancellor – but crucially not endorsed yet.

Much like the previous Iain Duncan Smith policy review on Social Justice, David Cameron does not have to endorse any of its findings or introduce them as party policy. Therefore, as seems to be the case, if the Conservative leadership are just going to ignore the vast majority of the proposals made by their own policy review groups, exactly what purpose do they serve?

The Government’s reasoning is that if they create a large number of very expensive youth centres, teenage thugs and ruffians will just suddenly stop causing trouble and enjoy using the new facilities instead.

Apparently many youths go out and cause ‘trouble’ (government speak for getting drunk, beating up other people, causing criminal damage to property, etc) because they have nothing to do. It’s not their fault you see. The fact that there are many other children who have ‘nothing’ to do and yet do not go around breaching the law does not seem to register as applicable to a government and a Labour party that just loves to waste your money on pointless and ineffective schemes.

But that is not really what this post is about. This post is about how the Government are attempting to legalise the theft of private money so that they can waste it on further unnecessary state projects, and unfortunately, this plan has been on the cards for sometime. With most British pension plans already pillaged and with government borrowing and taxation at unprecedented levels, Gordon Brown has been forced to pursue new ways of raising money for yet more unnecessary and wasteful government spending.

Currently the plan is to allow the Government to claim any money in any UK bank account, so long as it has remained dormant for fifteen years. Apparently there is £15bn of such money is stashed away in UK bank accounts. However, what individuals do with their own money is up to them. If they wish to keep money in an account for fifteen years or more, then that is their right. The Government should not be able to take an individual’s money whether they wish to make use of it or not. In the event that a person dies and leaves money in an account, then the bank should make efforts to trace the relatives of that person’s family and they should receive the money.

The government has plenty of other nasty ways of taking money which they have no right to – inheritance tax being a perfect example. Legalised theft from private accounts should not be another way.