ICM Poll on Income Tax
ICM's website has a new poll on taxation, carried out on behalf of Reform. As part of a wider study looking at flat tax schemes they asked about taxation in general, and about where people think the tax bands should be drawn.
The first batch of questions concentrated on the top rate of income tax, and found that people were broadly receptive to economic arguments for lowering it. About 50% of people agreed that a lower top rate of taxation would lead to people working harder and earning more money (43% disagreed), asked if a low top rate of taxation would make the economy grow faster 51% agreed (35% disagreed) and asked if a low top rate of income tax would help keep British business competitive a large majority agreed (60% to 28%).
In all these question Conservative supporters were more likely to agree than supporters of other parties, but almost every case supporters of other parties also agreed with the statements (the exception was that a majority of Lib Dem voters didn't think that a lower top rate of tax would make people work harder).
ICM then asked at what point it was fair for people to start paying income tax. Only about 8% of people chose a figure below £5,000 (the current tax allowance is £4,895). The median answer was £10,000-£10,999 which, interestingly enough, is the level proposed by the various flat tax plans that think tanks have been toying with in recent months.
The median answer for the point when people thought it fair for people to pay the higher rate of taxation wasn't far off the actual level - the median answer was £40,000-£44,999, as compared to the actual level, which is presently £37,296. 29% of people said £35,000-£39,999 or lower.
So, while people would be perfectly happy with the increased personal allowance that flat tax plans include, and seem to be fairly receptive to the arguments in favour of a lower top rate of taxation, they also seem to be perfectly happy with a top rate of taxation at around the current point. The actual plans for flat tax that have been presented by groups like the Adam Smith Institute have included cuts in public expenditure which might be rather less easy to sell, although ICM did also ask if respondents thought it was possible to cut taxes while making public servives better through reforming public services (64% agreed).
While the survey danced around issues connected to flat tax, but never actually addressed it, Reform apparently also commissioned some focus groups which dealt directly with the question of flat tax, and found that people were either unaware of it or downright puzzled by the idea.
