Tax busting

Back in June 2008, when Gordon Brown's government was young but already so weak it looked like it might not last, James Foryth wrote about one positive legacy it might leave. The Union Flag all around Whitehall on the top of public buildings. Whether you saw that cynically as an attempt by a Scotsman to win over sceptical English voters, or as a genuine attempt to support a sense of British identity, James was right and those flags are still flying.

We can all debate over what the great legacy of this Government should be or will be, and only time will tell which of its most important initiatives will prove most enduring: free schools, welfare reform, the fiscal adjustment or something else. But there is one achievement that I think has already achieved the almost irreversible status that James saw the raising of the flag attaining. There would simply be too much risk of negative publicity, it would jar too much in an age where data moves increasingly easily, for spending transparency to be reversed. While a vital first step came under Labour with the Freedom of Information Act, the Government have made the transparency agenda their own with gusto and taxpayers now know far more than ever before about how their money is spent.

If they want to build on that achievement then there is an obvious next step: tax transparency. Taxes are increasingly buried in the cost of our purchases or reductions in our earnings. How many people know that corporate taxes are depressing their wages? How many people know just how much of the money they spend on everything from petrol to cigarettes is going to the Treasury? I was debating the "Robin Hood" Tax with Bill Nighy on Channel 4 News last night and he was, along with its other proponents, pretending it was a tax on the banks. It is actually a tax on savers in the short term - who will see the value of their investments fall - and then over time workers as well - as it depresses investment and reduces wages.

Making the tax system simpler and more honest will take time. But in the short term the TPA is here to help. We've released a new app today that allows you to work out both how taxes increase the price of goods you buy, and also how they depress your earnings, meaning you have to work harder in order to earn the money. You can download it to your iPhone on the App Store, or access a web version for your desktop or other phones here. Find out how tax can really be very taxing indeed.

Matthew Sinclair is director of the TaxPayers' Alliance.