Adam Smith and the Budget
25 Apr 2009
When I first started paying tax, Tax Freedom Day was April 24th. Tax Freedom Day is the totemic date in the Adam Smith Calendar, when the citizen stops working for the Government and begins working for himself. (The self-employed sadly cannot beat the system by only working from April 24th, nor can the tax exile escape by only coming here after that date, and leaving on December 31st.)
Before taking my seat to listen to this year’s Budget, I established that Tax Freedom Day last year was June 2nd – itself a comment on how the tentacles of the state have grown during my time as a taxpayer. After listening to the Chancellor for 45 minutes, I believe the Government is going to have to consult the Astronomer Royal about extending the Gregorian calendar. The Government won’t be going to the IMF in 2010 to borrow some money; it will be going to 2011 to borrow some time. I am going to have to work longer for the Government than there are days in the year, and the Adam Smith calendar will have to be redesigned.
I was encouraged by the variation on this theme from Al Murray who said “Not until about halfway through your pint do you stop drinking for the Government and start drinking for yourself.”
And so the ritual of the Budget is over for another year. Colleagues stopped turning up in morning suits with carnations in their button-holes some time ago, and the ladies have stopped wearing hats. It is a monochrome occasion, and this was not an exciting Budget. The Chancellor didn’t even pause to drink some whisky-coloured fluid before announcing the increase in duty on spirits – traditionally one of the lighter moments in the Budget speech.
During one of Nigel Lawson’s Budget, I was sitting next to one of the wealthier MP’s, who was keeping the score on his pocket calculator. As the personal allowances were increased, he would score a plus of the relevant sum; as the duty on alcohol increased, he would score a minus. When Child Benefit went up, he was up, and when petrol duty went up, he was down again. By the end of the Budget, he was marginally up on the proceedings and was about to put the calculator away.
Nigel then announced a reduction in the top rate of tax of 40%. My colleague tapped away, and then a look of bewilderment came over him. “What’s the matter?” I asked.
“There aren’t enough noughts on this machine to tell me the value of that change.”
Had I been sitting next to him last week, his calculator would have had the same problem.
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Copyright Sir George Young Bt. 2015