Personal tax allowances are dying.
Tax credits are the future.
That seems to be the message from Gordon Brown, the chancellor, and the thrust of the government's argument over welfare state reform. It is a route which looks poised to make the welfare state considerably more redistributive, shifting resources from the better off to the less well off. But it will come at the price of hundreds of thousands and probably millions of people facing higher marginal tax rates as benefits are withdrawn and as taxes are paid.