Move over, St Patrick, we need your day for the Blessed Prudence, virgin and martyr
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he Spectator is a broad church, so an issue devoted to faith and reason may surely reflect on the Budget. I propose that March 17, hitherto St Patrick's Day, should commemorate the Blessed Prudence, virgin and martyr. The Golden Legend tells of her chaste association with a zealot, whom she sought to lead in the paths of fiscal righteousness. He made a show of their friendship but cruelly used her to divert attention from his backslidings. At last, betrayed and discarded, she wasted away: ()but 17 March 2004. Revisionist hagiographers, having cast doubt on St George and St Christopher, will ask themselves whether the Blessed Prudence ever existed. There was only one late, fleeting, nostalgic wave to her memory in the zealot's latest Budget. Though it came in his usual bludgeoning tones, was filled out with his usual fiddling initiatives, and left us, as usual, to pick the bad news out of the small print, this might have been a Budget from an earlier era, relying on a dash for growth, with a general election at the winning-post. Borrowing, he now asserts, is part of a healthy economic diet, keeping us going through the lean years and, apparently, the fat ones, too. Public spending will drive the economy forward, leaving the risks and the bills to be carried over to another day, and faced, perhaps, by another Chancellor. Sooner or later, the spending binge has to end, the public finances must be brought back into order, and there will be no painless way to do that. All the same, it would have Prudence's blessing.
Overloaded taxmen
Already the Inland Revenue is buckling under the Chancellor's burdens. Although its payroll has swollen by 40 per cent, the weight of his annual Finance Acts has increased even faster. It has to administer his cherished tax credits, and admits to having got them spectacularly wrong. Now he wants to make it a part of his power-hungry Treasury, and move it into his palace on the corner of Parliament Square, so that he can keep watch on it. There, it will form part of his vast new tax-extracting machine, to be constructed by merging the Inland Revenue with the Customs and Excise. This tidyminded marriage has been made in Whitehall, not in heaven. A tetchier union of opposites — the cerebral inspectors of taxes and the smuggler-busting excisemen — would be hard to propose. Taxpayers, however, may look on the bright side. By the time the merger and move are all over, any number of files will have been lost for ever, and the Chancellor will continue to wonder what has happened to his revenues. Perhaps Russian lessons are the answer.
The Putm touch
We can all see what happens to oligarchs who fall foul of President Putin. They are charged with tax evasion and slung into prison for leisurely questioning. This helps with the revenue, and does not seem to have done Mr Putin any harm with the electorate. If only, his pupil must murmur. If only all of his prospective taxpayers would simply pay up and look happy, how much happier he, too, would be. Why, his sums might even work out. The law seems to get in the way, though, and the more elaborate he makes it, the more scope the tax experts seem to find for argument. How he yearns to fix them. How about telling them that the advice they gave about handing down family houses, although right at the time, is wrong now — so that their clients must brace themselves for a sizzling brown envelope? He has backed halfway down on this scandalous proposal, but will still require the experts to register all their schemes, in advance, with the Inland Revenue, just in case it runs short of work. Mr Putin could take lessons.
Romer's Law
To the tax lawyers, every Budget presents a new challenge. They remind each other of the mighty dictum of Lord Justice Romer: 'If a man so conducts his affairs that he places himself outside the operation of an Act of Parliament, he cannot be said to be either evading it, or defeating it.' Lord Clyde said that we are not obliged to let the taxman put the biggest possible shovel into our stores. That is still the law, just about. When some later Law Lords ruled that a scheme could not succeed unless it served a genuine commercial purpose, the lawyers went into action, writing genuine commercial purposes into all their schemes. Will they now seek to bring the Inland Revenue under judicial review? The struggle continues.
Scratch that itch
By this time, most chancellors might have wearied of the struggle and be showing the symptoms of Chancellor's Itch. This syndrome, which I was the first to diagnose, causes them to fly away to ministerial meetings, where they can ride around in large black cars, have pleasant meals, be addressed as cher collegue and put their cares aside. When Gordon Brown first took office, he went out to the International Monetary Fund's meeting in Hong Kong, travelling via Luxembourg, Mauritius and Bangkok and attending subsidiary meetings. The experience seems to have immunised him, for good. Nowadays he can't wait to get home, even when he can be bothered to go. Hapless ladies on his ministerial team are sent off to represent him in Europe. The idea that he would fly away to Washington and run the IMF was just a tease for his Downing Street neighbour. As for the euro, snubbed once again in this Budget, it is his chers collegues' pet project and he thinks he knows better than they do. On this, at least, he may be right.
Just like old times
Describing itself as a think-tank. the New Economics Forum (new to me, anyhow) says that 1976 saw the quality of life in Britain at its zenith. Just as well, because if you tried to leave the country and were carrying more than £50, you would have been arrested. A dash for growth had run into the buffers, the top rate of tax was 98 per cent, inflation had just passed its peak of 26,9 per cent, the government's chief economic adviser said that Britain was doomed to decline, and the Chancellor of the day threw in his hand, inviting the IMF to bail us out. It all sounds rather like the Old Economics to me, but I am sure that the Chancellor of today, given time, could get us back there.
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