There is a lot of outrage being expressed in the papers and on-line about the so-called 'granny tax'. The way it was announced wasn't George Osborne's finest hour, but I've been wondering: how does the anger about the changes in tax allowances square with the frequent criticism made of the generations of British people who spent more money than they were making and left future generations with an almost unmanageable debt burden?
The post 1945 generations left nothing but IOUs in the national piggy bank.
Not once since the Second World War has a British Government even begun to pay back the War Loan it took out to fund the First World War. My family still has some War Loan, and every year, every single tax payer in the country is making a small payment to us for the money our family lent the Government in 1917.
The post-War generations are the ones that spent wildly, who created and increased all kinds of state benefits and also gave themselves access to the highest quality further education for free.
Now their grandchildren (who of course don't get free university education like they did) will also have to pay for their pensions, their health care, and even for their free travel passes for up to forty years.
We are constantly hearing that the bankers screwed up the world economy, well what about the socialist (and many Tory) dreamers that believed they could carry on spending for ever without paying back the capital?
Surely it's not that unreasonable to ask those that benefited most from the debt-fuelled house boom to pay a bit more?
As I understand the proposals, the poorest pensioners are unaffected, and it is only the loss of a tax-free allowance that is at stake. It is not a new tax. The people affected are most likely those who bought houses in the 1960s or 1970s for tens of thousands of pounds, and they are are now worth many multiples of their original values. And if it is their main residence it remains exempt from Capital Gains Tax when you sell it - one hell of a benefit for some. I think that CGT exemption should remain, and with that in mind, can the Chief Executive of SAGA and others turn down the moaning just a touch?
It is the next three generations of British tax-payers that will be footing the bill for decades of profligate spending. To ask for a small contribution from the people that benefited most from the booms that got us here is not untimely, be they pensioners or bankers.
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