It has emerged that the government’s proposed changes to Vehicle Excise Duty (VED) bands will leave 9.4 million motorists worse off by 2010. Approximately 8.4 million people will pay out around the same as at present, while only 1.4 million are set to benefit financially. This is a retroactive tax that will penalise some of the poorest people in this country.
In these tough times it is wrong for the government to increase the tax burden, especially for those worst off. This is especially grating because Prime Minister Brown promised that this tax will decrease the tax burden. The Shadow Chancellor, George Osborne, claims that Labour is walking into another ten pence tax fiasco; however, this will ultimately depend on how the leadeship and Labour MPs react to the news.
My suspicion is that the leadership – for fear of dithering – will not back down on any policy until the election. While Labour MPs – increasingly resigned to the fact that they can’t shake off Gordon Brown – will cower behind their embattled leader, biding their time until forced to crawl meekly into their 2010 valley of death.