One of the biggest tax swindles on ordinary taxpayers has been perpetrated by the Government itself

The coalition government love a good bandwagon and its latest target is tax dodgers. We see a lot of crocodile tears being shed over honest taxpayers being swindled out of millions by big business and dodgy accounting and it is clear that a lot more needs to be done to close these so called ‘loopholes’. But don’t be fooled. One of the biggest tax swindles on ordinary taxpayers has been perpetrated by the Government itself.

Cutting the top rate tax from 50p to 45p in April this year would make little difference to the Treasury’s coffers said George Osborne. Announcing the reduction, the Budget Book 2013 1.184 says ‘ The Government believes it is neither efficient nor fair to maintain a tax rate that is not effective at raising revenue from high earners…………….’ The Chancellor said that cutting the rate from top earners would cost £50m in 2013/14 rising to £110m by 2016/17 – but the latest government statistics show that he got it wrong – very wrong.

It is not the first time that the Chancellor’s figures don’t add up and I am sure it won’t be the last, but Osborne has really excelled himself with this one. If you only count those people earning more than £1m – and the Government’s own statistics show that this is set to rise to 18,000 in 2013/14 (we are clearly not all in this together) – the cost to the taxpayer is £2.255bn. That is 45 times bigger than the £50m shown in the 2012 Budget.

If you add in all those taxpayers earning more than £150,000 that figure goes up dramatically again. The new figure for revenue lost to the Treasury is more than £4bn. These figures show the Chancellor diverting a massive amount of money into the pockets of the very rich, at the same time as the Government is making massive cuts to welfare and public services – it is immoral.

All that money could have been used to stop the cuts and inject some life into our failing economy. It would have gone a long way towards providing decent long term care for the elderly; help end the scandal of 15 min homecare slots; the Government could scrap the bedroom tax and restore help to some of the poorest in our society. The money raised could have been spent on helping the millions of people desperate to find work and our young people facing such an uncertain future.

But I am clearly getting carried away – we have a government that is complicit with big business interests. The savage cuts to public services are not felt by those at the top – they are directly hitting those at the bottom. The UK is the 7^th richest country in the world and yet we have half a million people queuing up at food banks just to feed their families. We have 200,000 people on zero hours contracts, masking the real scale of the hardship of unemployment.

There is an alternative – the Government could have made a fairer choice. But then again – it is a Tory government.

Dave Prentis is the General Secretary of Unison. This piece forms part of our coverage of Unison conference, which is taking place in Liverpool this week