Let me predict the headline the Chancellor would like to see in tomorrow’s Daily Mail…

PERSONAL ALLOWANCES RAISED TO £10k A YEAR EARLY

It’s a measure which has the double attraction of keeping the LibDems happy and giving his own activists something to trumpet on the doorstep. What’s not to like. He can go down as the Chancellor who has taken millions out of income tax. Bear in mind that the personal allowance was £6,475 when the Coalition came to power. However, if this is the only tax cut in this budget it will be a travesty.

Politicians and pundits on all sides of the debate are in agreement that this, to coin a phrase, really does need to be a budget for growth, and if that is to be achieved three things needs to be done. There need to be immediate tax cuts – not just ones which filter through over a period of months and years. Government spending needs to be readjusted and redirected towards capital projects, and in addition total government spending needs to be cut further in order to give the markets confidence that the government is still committed to both deficit and debt reduction.

I think we can all confidently predict that the planned fuel duty rise will be cancelled yet again. If he were sensible, George Osborne would just cancel all planned future rises and have done with it, but the political gain from being able to stand up every budget and be the friend of the motorist will no doubt prove to irresistible.

I’d also like to see a commitment to simplifying the tax code. It now runs to 17,000 pages – longer even than when Gordon Brown was Chancellor. No wonder no one understands it. It’s the most complex tax code in the western world and it’s not too much to expect to ask a Conservative chancellor to live up to his manifesto commitment and simplify it.

Something which the Chancellor won’t do, but is long overdue is to extend the threshold of the 40p tax band. Its scope has more or less doubled in the last few years and it’s a scandal that someone earning more than £32,011 will be paying 40p in the pound from this April. It’s a stealth tax Gordon Brown would have been proud of but didn’t dream of implementing.. In his last year as PM the 40p band started at £37,400. Does anyone seriously think that the 40p tax rate shouldn’t start at somewhere north of £60k or £70k? Our tax bands are getting very out of kilter with earning realities.

Mark Littlewood of the IEA has suggested that the deficit can never be brought under control unless welfare spending is slashed. I agree. And this is where reform of the 40p tax band comes in. Why not increase this to, say £40,000 in the first instance and then have a blanket rule that anyone in that band is not entitled to a single welfare benefit? OK, the figures may have to be altered (I don’t have access to the Treasury forecasting model) but surely it is a good principle that people paying a higher rate of tax shouldn’t be entitled to welfare benefits. At least, in any normal tax system and in a society with normal moral values that ought to be the case. The trouble is we have built a society where even people on £50k a year think they have entitlements. I’ve always believed that welfare benefits should go to those who really need it. They should be a form of safety net rather than an automatic right. This is where Gordon Brown’s system of tax credits has been so insidious. It needs to be dismantled and the government should be quite open about the need to do it and do it quickly. Universal Credit goes some way towards achieving this aim, but not the whole way.

The trouble is, virtually none of this will happen. Political considerations will rule these measures out as too radical and ones which would frighten the electoral horses. And that’s why the years of austerity will last for so much longer than they really needed to.