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FactCheck: Has Brown raised stealth tax 99 times?

By Channel 4 News

Updated on 21 March 2007

The Conservatives's claim has a familiar ring to it - but does it check out?

The claim

"In 10 years Gordon Brown has stealthily raised taxes 99 times. On past form we will see stealth tax rise number 100 in the Budget on Wednesday."
Conservative Party website, 19 March 2007

Background

Afficonados, and people with long memories, will see that this has a familiar ring to it. The Conservatives trumpeted a similar claim at the 2005 general election, although the other way round - 66 tax rises, instead of 99.

There's a picturesque demonstration outside the Commons on the day of the budget, with 99 red balloons and activists in Gordon Brown masks.

The essential claim behind this stunt is that Gordon Brown has put taxes up by stealth, imposing subtle changes to the tax code that people don't immediately notice in their pay packets, but which costs them money.

The word 'stealth tax' is one you'll hear again and again. But does the claim itself stack up?

Analysis

At the last election, we learned that the 66 tax rises claim was pretty arbitrary.

The Conservatives were good enough to provide us with a list of those 66 alleged tax rises. Some were corporation taxes and other measures which only affect average citizens very indirectly, some were very small. A rise in the duty on 'minor oils' was the most obscure example.

And some were green taxes, not unlike the green taxes David Cameron as been advocating this past year.

At the time, however, the Institute of Fiscal Studies calculated a list of their own. And the number of tax rises they came out with was actually far larger than the number the Tories came out with: 157. That was in 2005. Two budgets later, that number would be closer to 200.

Labour's rebuttal was that while they had put in place numerous tax rises, they had actually put lots of tax cuts in place too. The IFS counted 215 in 2005, and that number will have gone up too.

So the figure itself is more than a little arbitrary. It's not impossible that the Tories may have started with their idea for a demonstration, picked Nena and her 99 Red Balloons, and worked backwards from there.


IFS research suggests the tax system is more progressive than it was in 1997.

In any case, surely what matters most is not the number of tax rises or falls, but the overall size of them. So how has the tax burden risen under Gordon Brown?

Tax revenues were 37.3 per cent of national income in 1996-7, and that which has risen to 39.3 per cent in 2006-7. That's something of a rise overall, but it doesn't fall evenly across the population. And some of it has been handed back to poorer citizens in the form of benefits.

The latest analysis from the IFS suggests that the tax system has become rather more progressive than it was in 1997. So while richer people are paying more in tax, the poor are paying less. The Tories' claim that the average tax payer has lost out to the tune of £1300 per year.

FactCheck rating: 4

How ratings work

Every time a FactCheck article is published we'll give it a rating from zero to five.

The lower end of the scale indicates that the claim in question largerly checks out, while the upper end of the scale suggests misrepresentation, exaggeration, a massaging of statistics and/or language.

In the unlikely event that we award a 5 out of 5, our FactCheckers have concluded that the claim under examination has absolutely no basis in fact.

Verdict

The Tories 99 tax rises chart is a neat claim. It makes for a nice photo call, and refers back to the 66 tax rises claim of two years ago.

But like the earlier claim, it doesn't have very much to do with the actual facts of the case. Nor does it make much of a useful commentary on what is actually happening in the economy.

The tax burden has gone up, and some of those rises have been through indirect taxes which don't make the same impact as a change in the headline rate of income tax. But spending has gone up too, and so have benefits.

Sources

FactCheck, 2 Feb 2007: Has Brown put tax up
George Osborne: Gordon Brown's 99 stealth tax rises
Institute of Fiscal Studies, Green Budget 2005, Chapter 6 (pdf)



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