THE main UK parties have "plucked from thin air" multi-billion pound targets for tackling tax avoidance and evasion simply to make their economic plans add up, the Institute for Fiscal Studies has claimed.

 

In a second damning report about the parties' election pledges - this time on tax and benefits - the respected economic think-tank accused the Conservatives, Labour and the Liberal Democrats of expressing a desire to raise more tax revenue in "vaguely-defined, opaque and apparently painless ways".

On tax avoidance, the Tories wanted to raise £5bn, Labour £7bn and the Lib Dems £10bn, figures, which James Browne, a senior research analyst at the IFS, said had been "plucked from thin air to make their plans add up".

In terms of proposed benefit cuts, the think-tank upbraided the Tories for not specifying where the £12bn worth of planned reductions would largely fall, complained that the Lib Dem proposals were vague and noted how Labour's policies were trivially small compared to the scale of rhetoric it had used.

It explained how there were large differences between the Conservatives, Labour and the Liberal Democrats in how to reduce the deficit further.

"But," the IFS stressed, "they share a lack of willingness to be clear about the details and an inability to resist the urge for piecemeal changes, which would make the overall system less efficient and coherent."

The think-tank concluded, given there was still a significant process of deficit reduction still to come, that households across Britain could expect the tax and benefit plans of any of the main parties to lead to a cut in average incomes.

The IFS said that because of time and resources it had not examined the SNP pledges but noted how some of them crossed over with those of the main Westminster parties.

On Conservative policy on benefits, it said there remained a £10bn gap, which would be "neither painless nor easy" to fill, noting how, given pensioner benefits were being protected, it was hard to see savings being made without sharp cuts to one or more of child benefit, disability benefits, housing benefits and tax credits.

It also noted that even with the Conservative policy of raising the threshold for the higher 40p rate of income tax to £50,000, a further 300,000 would be drawn into paying it, meaning by 2020 there would be five million people paying it.

The promise from both the Tories and Lib Dems to increase the personal allowance to £12,500 was, it noted, of "most value to those in the middle and and upper-middle of the income distribution" given that 44 per cent of adults already earned too little to pay income tax.

The IFS argued Labour's tough rhetoric on spending cuts was not matched by its announcements.

For example, its proposal to cut the winter fuel allowance for higher rate taxpayers was "fiscally irrelevant" and its plan for a one per cent cap on child benefit increases would raise "literally nothing" because of low inflation.