Tory tax pledges put paid to planned election

As you probably heard over the weekend, Gordon Brown decided not to call an election after all. He arrived at this decision after studying polling data that suggested a huge swing to the Conservative Party as a result of their promise to raise the inheritance tax threshold to £1m.

Wow. So tax cuts are popular, after all? Who's have thought it?

The Pre-Budget Report is being delivered tomorrow. Expect Gordon Brown to come up with a copycat inheritance tax cut. But expect it to be, in typical Brown style, stingy, complex and extremely difficult and wasteful to administer.

There might not be any detailed inheritance tax relief in the Pre-Budget Report, but listen out for a statement about wanting to ensure 'fairness' in the inheritance tax system.

But what does it matter if Brown nicks the Tory policy? If he does, everyone would know that that was what he did, and that can only be good for the Conservatives, and the taxpayers who will benefit. If, on the other hand, he introduces a less generous relief than that being promised by the Conservatives, everyone will see that, too.

Arguments about the Conservative Party's promise being 'uncosted' and 'unaffordable' won't work, either. Even if Brown manages to put out figures to claim that the expected tax from 'non-doms' won't be enough to pay for the Conservative tax promise, all the Conservative Party has to do is point to the almost £2bn mistakenly overpaid every year within the tax credits scheme. Those wasted funds should go a long way to paying for the inheritance tax promise. Somehow I doubt that Brown would much welcome attention being drawn to the annual £2bn tax credits overpayments, seeing as he was the Chancellor who presided over the whole shambles.