Introduction
We have certainly been living in interesting times, to misquote
the old Chinese proverb, with the worst recession since the end of
World War II, a meltdown in the banking system and a huge hole in
public finances.
That sort of scenario would usually be expected to result in
immediate increases in the main taxes, but in the Pre-Budget Report
(PBR) in November 2008 the Chancellor announced an immediate
temporary reduction in VAT in an attempt to stimulate spending on
the high street. He did however warn of increased national
insurance contributions (NIC) and income tax rates, although these
would be delayed until April 2010 and April 2011 respectively.
During the period since November the economic news got worse and
the media speculated whether the planned tax and NIC increases
might be brought forward. Moreover, the usual scare stories about
the possible restriction of tax relief on pension contributions
seemed this year to be linked to official
