Happy Budget Day!

A Budget is a lot like Christmas: you hang your stocking out the night before, waiting to see what the generous paternalistic figure will put in them, and then are invariably disappointed when the great day comes. Instead of receiving booze, you receive booze tax. Instead of a festive fiver from Aunt Marge, you get £178 billion of public borrowing.

Well, this Budget is unlikely to be ruined by high expectations. Even if Alistair Darling can cut £8 billion off the public borrowing, funded by better-than-thought tax revenues, it is cold comfort and will not lessen the across-the-board departmental cuts which are going to be made.

On the subject of these cuts, there is not a great chance Darling will spell them out lest the Tories start campaigning on themes like ‘Gordon’s going to make soldiers fight in cardboard uniforms’ or ‘Hospitals to make surgeons operate on two people at once’. This shouldn’t shake the markets, since they’ve already had their fill of prevarication and have taken it out on the pound for months now.

Like pointy shoulders, soaking the rich is back in fashion. The 50p top rate of tax for income over £150,000 is well-known, as are the methods for attempting to avoid it, but this was unlikely ever to raise that much money, given that capital gains tax is only 18p.

As already trailed, Darling will also be seeking to double the fine for those caught stashing cash in unco-operative tax havens to 200 per cent. This is a rather foolish move: unless HMRC *really* smartens up its act in catching evaders, Darling should remember you catch more flies with honey than vinegar. As Berlusconi (of all people) showed, a tax amnesty on favourable terms can repatriate plenty of money *and* destroy a small Swiss town.

The problem with the Budget is that while Darling’s speech winds up the media and commentators and lets them go, the most interesting aspects are often only found in the full document released straight afterwards. With that in mind, we will be liveblogging the Budget from just before 12.30 today, getting expert reaction straight afterwards, and following up tomorrow with those all-important announcements hidden in the small print.