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National politics

TUC – wallies or liars?

Today the TUC have published a report looking at banking profits and claiming, essentially, that the banks have diddled the public out of £19 billion. It is all total nonsense of course. They are complaining about companies being able to offset losses in one year against profits in another year to lower their corporation tax burden. This is the way corporation tax has worked for decades and without it you would tax companies for profit they did not make.

In their background the TUC talk about the £850 billion bank bailout. Again this is nonsense designed to baffle the unwary. In his last budget (Box C4, page 213) Alistair Darling’s own estimate of the total loss to the UK taxpayer as a result of the bank bailout was £6 billion. He said then:

At current market prices the cost of the financial sector interventions net of fees and other income would total £6 billion …

At today’s market prices the UK government is well into profit on the transaction I would think. The £850 billion figure made the assumption that everything would go wrong and nothing would go right. Luckily life is rarely like that and the bailout was well handled.

In their press release TUC General Secretary Brendan Barber said:

Banks caused the global financial crash and triggered the recession that produced the deficit. Yet not only did they take almost a trillion pounds from taxpayers to bail them out, they are now using the losses caused by their irresponsibility to cut their tax bills for years to come.

I think that makes him bare-faced liar.