Tax betrayal of war veterans

It has taken on even greater importance following the Iraq war, and Britain's continuing military involvement in Afghanistan, as the

number of casualties mount by the day.

Yet, despite assurances by Ministers that they value the Armed Forces, they continue to be treated shamefully – whether it be inadequate equipment or the latest tax bungle that has left veterans fearing they will be taxed on the war pension. Until now, war pensions have been exempt from tax. Everyone knows this. Except, that is, Her Majesty's Revenue and Customs and the bureaucrats who programme its computers.

The result is nearly 200,000 letters have been sent out downgrading the tax status of veterans – and leaving them fraught with worry about their future financial arrangements.

Yet, rather than admitting to the error and taking immediate steps to rectify matters, it is, shamefully, being left to each and every veteran to take up the cudgels with the HMRC.

It should not be like this. If Gordon Brown and Bob Ainsworth, the Defence Secretary, are sincere when they talk about their debt of gratitude to the Armed Forces, they would be ordering HMRC to send out the correct documentation to those concerned.

However, this would require leadership – the very commodity that Ministers expect of all those tasked with fighting New Labour's wars. Yet all Britain's troops appear to get in return from this Government is cowardice over its failings, and shocking revelations about how it deceived the electorate over the legality, and wisdom, of the invasion of Iraq.

This shambles, which is on a par with the Rural Payments Agency's incompetence over farm subsidies, leaves one other lingering question: are the public finances so poor that the Government now intends to tax war pensions, but does not have the courage to be straight with the veterans concerned?