The Coalition planned to raise an extra £11,500 from the average family of four by 2014-15, compared to 2009-10. (June 2010 budget)
They needed all this extra tax to cut the deficit, as Labour had been spending so much more than it collected in revenue.The country cannot carry on living on a rising overdraft for ever. They also had to pay for the extra £6000 of current public spending for every family of four that the Coalition itself planned. Even allowing for the cuts in capital spending, the Coalition needed a big tax rise.
The Coalition decided to live with Labour’s proposed rise from 40% to 50% on higher incomes. They increased Capital Gains Tax from Labour’s sensible 18% to 28%. They increased Stamp Duty on property. They raised VAT to 20%.
The only one of these tax rises that produced some of the extra revenue they sought was the increase in VAT. The higher rate of Income Tax accelerated the departure and the decline of high end incomes in the UK, and revenue fell sharply. The new CGT rate is forecast to yield lower receipts this year. The high end Stamp Duty has led to a big slowdown in sales of expensive flats and houses around the £2m plus mark in Central London, hitting revenues and mobility compared to estimate.
The government has stuck to its current spending plans. The going gets tougher on these next year, when there are smaller increases than in the first three years. It is trying to buttress its falling tax revenue compared to forecast by exhortation and loophole closing. It is seeking the elusive extra billions from rich people and companies that all hard up governments seek.
On Friday I was reminded by Andrew Neil on the BBC Politics programme just how far and fast the UK Tax Code has expanded under this government. As smart accountants, lawyers, tax advisers and Finance Directors find new legal ways round the tax code, so the Treasury hits back with yet more loophole closing measures.
If you want to collect more tax there is a simple motto you need to follow – fewer breaks and lower rates. Higher rates and more breaks is never going to bring in enough revenue for this high spending state. It is merely going to produce an ever bigger and more complex tax code. It creates more division and bitterness within the society,as groups squabble over whether everyone is paying enough tax. The richest are the ones who can afford to leave altogether, or who can rearrange their affairs to avoid tax legally whatever the regime.
February 3, 2013
“Fewer breaks and lower rates” is clearly the answer as you rightly say. But why on earth were Cameron, Osborne and all the government “experts” all so stupid as to ever think otherwise? The government have over taxed, regulated, burdened with high energy costs and lack of sensible bank lending the private sector with the entirely expected results.
This while wasting money hand over fist in the largely parasitic state sector and going ahead with lunacy like HS2. Furthermore paying the state sector with pensions about 150% more than the private sector.
The parasitic sector also includes much of the private sector. Many lawyers, accountants, tax planners, employment and health and safely people all encouraged and augmented by idiotic laws and regulations such as Cameron’s gender insurance lunacy.
Meanwhile they think that HS2 (which will blight countless buildings and areas for 20 years before even a train runs) is being pushed through. I see he came up with an argument for it while sitting on a train – “other countries have them so we should”. Clearly all that Eton and Oxford PPE was not wasted on him. Just a shame he cannot add up. In the short term (20 years +) it is clearly worse than paying people to dig holes and fill them all in again (as that would not blight countless homes and businesses).
Just put the numbers on a spreadsheet and in 20 minutes anyone numerate and logical can see it is madness. Worth perhaps 10% of its cost to build.
Anyway I left a the UK a few years ago and will not be returning, other than on short business trips perhaps if I must. It is a good place for rich nondoms, black market people and benefit claimants mainly. Worse still Miliband to come soon for 10-15 years.
February 3, 2013
I pray that Cameron’s argument for his new train set is more detailed than you say.
However, I thought I would just mention that the insuance policy gender stuff came from our good friends in Brussels, not Cameron.
February 3, 2013
Well Cameron accepted, and has not complained, about the gender insurance insanity has he? So one assumes he likes it.
February 3, 2013
If you are referring to the Test-Achats case then the decision came from our good friends in Luxembourg; the location of the Court of Justice of the European Union.
February 3, 2013
Lifelogic: You took the words out of my mouth… What a lack of numeracy these clowns seem to have. Apart from PPE, did they ever succeed at Mathematics?
The only way out of this morass is to give SMEs a break (reduction in the dreaded red tape, bonfire of the quangos) and let the country start producing again. More production = more profits = more tax take… Simple.
But no. HS2 and the bloody windmills will be our downfall. For those of us who live near the latter, they are a blot on the landscape without paying their way. No wind/too much wind = no power generated/burnt out turbines…
And, to Mike Stallard below, I tell you, you are right.
February 4, 2013
A blot on the landscape might be justified for some vital development but HS2 and wind power are clearly pointless economically on any rational analysis.
Some one sensible in a committee, asked Cable about the lack of warming for 15 years and how many years lack of warming it would take before he saw sense and stopped this pointless waste.
Needless to say answer came their none. He droned on, with a childish grin, about Mrs Thatcher being convinced by the science some years ago, what on earth has that go to do the matter? How many year will it tax before these people let go of their silly religion?
The BBC (on Andrew Marr) still pushing Al Gore at us yesterday after flogging his tv business for some oil and gas wealth. Also Tony Bliar on the new war in Mali. Do they ever look at people’s record of being right, before inviting them on? I heard real no questioning of Blair and his disastrous and totally counter productive wars, wars we are still trying to escape from.
February 4, 2013
And now they are going to cover hundreds of acres of prime farmland on Romney Marsh with solar panels – also with huge government subsidies.
February 5, 2013
Complete insanity, if we are investing in PV at least put them somewhere sunny. Mind you it is far cheaper than putting them on roofs which is really daft. Just kill the state subsidy and the problem with vanish.
February 3, 2013
Is there a parasitic private sector? Simple question that requires a simple answer. Good point that it is a place for rich Non Doms and benefit claimants though. A democracy shaped by the interests Non Doms leading to benefit claimants. Ram it.
February 3, 2013
Yes lots of parasitic jobs in the private sector due to absurd regulations and absurdly complex tax laws and the litigation culture the government has encouraged.
February 3, 2013
Baz
Simple answer to your simple question
There is no parasitic private sector
All money that the State spends comes from the private sector, or the real world as I prefer to call it.
Apart from the billions they borrow every year of course.
There is no money tree, sadly Marx was having a fantasy.
February 4, 2013
No parasitic private sector? Banking for a start and a whole host of parasitic corporations leeching cash from the government undermining democracy by withholding information due to commercial secrets and often providing low cost by low quality of goods and services in a monopoly that rewards an elite and pays poverty wages subsidised by the state, subsidies for many other things, tax breaks included, and then on top of that avoids tax on the profits ripping off the state and often the customers. The money tree for these corporations is very much alive, even the banks who crashed were still given bonuses by the government. You really are dreamers and a fantasists.
February 4, 2013
Baz
Why waste your time asking the question in the first place if your mind is already closed to anyone’s views other than you own?
You complain when nobody can be bothered to reply to your demands for a response and then complain when someone does.
If you want people to just post as follows
“sorry baz you are right as always” then just let everybody know and we can all save ourselves some time.
February 5, 2013
Bazman: “Banking for a start and a whole host of parasitic corporations leeching cash from the government undermining democracy by .. ”
Welcome to our fascist (which is the same as Socialist) command economy. It is not a ‘free market’, the thing you always hold up to ridicule, it is the very economy you tell us we should all aspire to, one run by the state.
Be careful for what you wish for, it looks like you have got it.
February 5, 2013
It was a rhetorical question Edward, though I would appreciate you beginning any answer or at least signing off with “Sorry Baz you are right as always,” You don’t have to. What was your views on there being no parasitic companies? I’m glad to have helped you become more informed. I do what I can. Spreading seeds and so on. Pearls to swine. Strawberrys to donkeys as it may be.
February 3, 2013
“If you want to collect more tax there is a simple motto you need to follow – fewer breaks and lower rates. ”
OK so if you know that and I know that, why aren’t they doing it?
Answer = because they want to win the next election and are afraid to touch “the third rail”.
A very simple sum:
We are between £1,000 and 11,000 billion pounds in debt.
That means that we are paying out some £10 billion pounds per annum if the rate is just 1%.
If the rate were to be 5%, we would be paying £50 billion pounds which compares with the defence budget.
(At 10% it would be somewhere up there with Education, Foreign Aid and moving towards Welfare.)
We are wasting a lot of money just to service the debt.
Tell me I am wrong.
February 3, 2013
Sorry – £1,000 and 1,100!
February 3, 2013
Who on earth are their advisers, Balls & Milliband?
February 4, 2013
François Hollande perhaps too?
February 3, 2013
The government has never managed to raise much more than 40% of GDP in tax now that people are more mobile with the internet and flights this is even harder to do. Even the daft Dennis Healey (now 95 I see) did not make it with his 83%, and even 98% was it, income tax rates. A double first in Greats but rather lacking in common sense it seems.
Government should be aiming to spend less than 30% of GDP. People spend and invest money far more efficiently than governments in general anyway as can clearly be shown.
February 3, 2013
LL,
Your last point agreed – I sometimes reflect on the effect of splitting the NHS Budget on a per head basis and giving people Health vouchers.
What are the figures ? £100 bn budget divided by 60 m souls?
Say £1600 per person per year-that’s a lot of insurance when you’re young and learning how money and the markets work ,that experience would come in useful for your old age.
Bet the insurance industry and privaye health care would come up with solutions a country mile better than Stafford Hospital.
February 3, 2013
Almost anything would be better than Stafford Hospital it seems. I see the Daily Mail has some interesting details on the odd expenses paid to top NHS staff too – the other day.
February 3, 2013
I do not know why vouchers are politically impossible. But they are. A lot of influential Public School people would really to introduce them into education. Free Schoolers (like me) would then be freed up to open free schools to everyone and see what happened.
Health vouchers (OK with differences) seem to work very well in Singapore.
February 3, 2013
scary thought that you would only have £1600 of treatment per year to come if you ended up in a wheelchair after being the innocent victim of a drink or drugged idiot in a stolen car – – or would the rich be able to buy “top-up” vouchers?
February 3, 2013
Dear Neil,
Your not too big in the thinking department are you, why not just buy health INSURANCE with your vouchers? It costs a lot less than £1600 pp too.
February 3, 2013
yea but an insurance company wouldnt take on someone already seriously ill before they entered the country as a work visa holder or one of their family like the NHS does would it? crazy nonsense like this is what needs fixing to stop the finances crumbling
the NHS model is badly broken and it does need turning into a state backed insurance company, where patients decide where to take the payouts, only with buying power in the hands of patients will it iteratively optimise over time
February 3, 2013
Perhaps better still if people paid as needed as they pay for food and haircuts with perhaps some help/safely net for those hit by some dreadful long term disease.
February 4, 2013
The British health system would in effect be run like the dental service. You think that is any way to look after the nations health? We deserve better than that. Another one of you third world ideas. I see the clean up bill for Sellafield will reach more than £67 billion paid to private companies by the taxpayer. Bradwell will be cleared in 2083 it is claimed. It shut in 2002! How much will that have cost then? Makes the high speed rail look like a bargain. Little to say about nuclear subsides have you? But plenty to say about the user paying for everything else except housing. Strange.
February 5, 2013
Bazman: “We deserve better than that.”
Just out of curiosity and a straightforward question. Why do you deserve better?
By the way, I’m a national health patient in my local dental practice – I don’t mind paying the fairly reasonable surcharges.
February 4, 2013
What happens to someone with a medical condition that requires more than £1,600 per year to treat, such as cystic fibrosis? Are they denied treatment after they spend £1,600 on medicine?
February 6, 2013
Natural selection applies to economics to many on the extreme right, but not in the natural world.
February 3, 2013
Greats does not = mathematics!
February 3, 2013
Just some basic sums would do.
Mathematics if perhaps expecting too much.
February 4, 2013
“is” sorry.
February 3, 2013
“Even the daft Dennis Healey (now 95 I see) did not make it with his 83%, and even 98% was it, income tax rates. A double first in Greats but rather lacking in common sense it seems.”
Those rates were simply window dressing as at the same time bank loans and City lunches were tax deductible. Enoch Powell under the tutelage of AE Houseman won a double starred First in Latin and Greek at Cambridge. It was recorded that ” in one Greek prose examination lasting three hours, he was asked to translate a passage into Greek. Powell walked out after one and a half hours, having produced translations in the styles of Plato and Thucydides. “
February 4, 2013
He clearly had enough spare time to get his economics straight too. Unlike Ted Heath with his by prices and incomes (political control of) policy.
I note Cameron has already “taken leave of his senses” and is trying to fix insurance premiums politically and lecturing on the morality of legally avoiding paying too much tax – just to see him waste it on HS2, transfers to the feckless, PIGIS loans, misdirected aid, new wars and “renewables”.
February 3, 2013
“Fewer breaks and lower taxes”. Yes, indeed, and I would add less public spending. Whatever happened to the idea of a simple flat tax mooted by Mr Osborne a few years ago? That seems an idea whose time has come.
February 3, 2013
I have always ‘mooted’ a flat tax. It’s fairer on everybody, would be much lower than the current ‘theft’ and would most likely raise much more in total tax.
Osborne ‘moots’ like Cameron gives cast iron promises.
February 4, 2013
A flat tax is only “fair” for the wealthy because it results in them having a tax cut. For everyone else it means they pay the same amount of tax or more.
February 3, 2013
“They needed all this extra tax to cut the deficit”
OR they needed to cut spending more.
Instead we have a Prime Minister who showers borrowed money on his pet projects: The EU; International Welfare and any country which holds out the begging bowl; Middle-East wars; immigrants; the climate change scam.
Lowering income taxes on the right, whilst loading taxes on the expenditure of lower and middle income families isn’t clever politics OR clever economics.
Unless you are already living on the breadline and only buying real essentials, it’s very easy to cut down your expenditure – I’ve done it. Not because I can’t afford to go where I want and buy what I want but because I REFUSE to pay the extortionate levels of VAT and fuel duty which our avaricious Government demands in order to play Madame Bountiful to everyone but the hardworking taxpayers in the UK.
The sooner Cameron is kicked out and finds a job more suited to his abilities leading the PR Division of a Charity Quango, the better for the country. The sooner Osborne is removed and replaced by someone who has at least some understanding of the real world and a background in economics, the better. The writer of this blog comes to mind, but there are others.
February 3, 2013
Boudicca: Hear hear. Couldn’t have written it better.
February 3, 2013
like
February 3, 2013
Worse still the government even use tax payers money to indoctrinate the public. With nonsense like the enforced “equality” agenda and the gross warming exaggerations. Even using subsidy to encourage the public to spend their ovn money on daft things like the ugly PV and wind house bling which usually devalues and makes their homes much uglier.
February 3, 2013
And, what about gay marriage?
February 3, 2013
Gay marriage has nothing to do with equality and everything to do with trashing an ancient and respected institution that has so far stood the test of time. In other words “If I can never have what you have then I will destroy it”.
February 4, 2013
Not trashing it for me, so why is it trashing it for you? Have some sort of personal interest in gay marriage have we? You cannot come out with a statement like this and not back it up with credible argument. Your usual walking off or haughty self righteousness and indignation will not work on the net nor should it. You will be questioned and a reply is expected no reply confirms your bigotry. ( external reference left out-ed)Ram it.
February 5, 2013
Where would you like me to “ram it” this time?
February 5, 2013
One of the problems with Dave’s gay marriage is that, under the law as proposed, it will be impossible for gays to divorce for adultery. The homosexual sex act is not defined as a part of the deal. (etc ed)
February 4, 2013
Roman records indicated that gay marriage did occur in the Roman Empire until Christianity became widespread. Though gay marriage continued in the eastern Roman empire (Byzantine empire) and eastern Europe for far longer.
So gay marriage isn’t “trashing an ancient and respected institution” but restoring it to its pre-Christian form.
February 5, 2013
Something lost in translation over the millenia perhaps. The word “gay” has changed meaning in only 40 years or so.
February 3, 2013
I have no real problem with Gay Marriages but clearly we should also have civil partnerships for non gays too. But it is a strange priority (diversion) for Cameron, even by his standards.
February 3, 2013
Obsorne’s Granny tax was one of the most despicable and unforgivable – something we would have expected from Brown but not a Conservative Chancellor. Wealthier pensioners never benefitted from the age related personal allowance nor did those on benefits who pay no tax but it did benefit those in the middle ‘who’ve done the right thing’ and saved for their old age and now typically are the ones to be clobbered. People like my 67 years old neighbour who worked all his life and when he retired a couple of years ago like most people in the private sector his private pension had taken a hammering and so to get the best of a bad deal, he took a non-index linked pension which means it will never go up whilst everyhing will. Unlike the under 65′ s who have seen their personal tax allowance rise dramatically in the last couple of years, his tax allowance has been frozen. From his combined state and private pension of £12,000 he still has to pay over £2,000 council tax as well as income tax. He is left with £800 a month for him and his wife to live on whereas someone who has never bothered to provide for their old age receives £946 a month in pension credit on which they pay neither income tax or council tax. He is now wondering why he bothered.
Cameron and Osborne are proving they haven’t got a clue how the other half live or they would never have allowed this punitive measure on our elderly whilst at the same time continuing to give billions of our money way in aid and benefits.
February 3, 2013
What I would like to know is if either of them asked the fundamental question for their actions – “What if…” No, I thought not.
February 3, 2013
Julie
Agreed
February 3, 2013
the only thing that surprises me about your letter is that no one has gone in to throw them compulsorily into a home – just so their house can be sold.
I have argued the same point on pensions as you – I have worked all my life – -people who havent will end up with same as or more – -for contributing NOTHING – -so I have paid for their pensions as well !!- -yet the government sees this as ok ????
and we are shortly to “import” thousands more -who presumably will be entitled to housing, money, schooling for the children and NHS treatment – and of course a pension or benefits to equal it when old enough. – -all for contributing absolutely ZILCH – -which means a choice of 2 things – or probably BOTH – -tax increases and cutbacks in services.
we have all read of immigrant freeloaders on £OOO’s – -I have worked for 45 years – -now injured and off work – after this length of time contributing I was awarded £22.17p a week – -yes £22.17p – -it has gone up slightly since but it shows the difference nationality can make .
BUT YIPPEE – -maybe before I die I can go a few miles from my home and see a train go past with EITHER – -rich people going past and looking at the penniless oiks that paid for it – -OR – -all the east europeans being transported to their new houses that will shortly be built for them.
February 5, 2013
My position is similar, except that my private pension is under £1000 pa and my OAP is less than the new one proposed for new pensioners. Fortunately, investment income tops me up to around the national average. This year when filing my tax return online, there was a higher figure given of ‘tax due now’, owing to a raised income of about £2k and a demand for an advance payment for this year. This figure did not appear on the final page and print off version. Why there is an advance payment every year, when presumably it was also paid the previous year is difficult to understand. Possibly many taxpayers will be facing fines, having missed the advance demand and only paid the amount showing on the final page and print off. Overall, my tax this year more than doubled. I have cancelled the planned holiday owing to this unexpected increase. I wish it was only randchildren that the ‘grannytaxed’ had to contribute to. Many of us still have to fork out for our children at university.
February 3, 2013
I watched the programme and your logic was predictably faultless. It is no wonder that there appears to be momentum to get rid of the dynamic duo before 2015 as even Conservative MPs, particularly those with majorities below 5000, are showing signs of agreeing with the deluge of comments albeit in the Mail and Telegraph rubbishing them on a regular basis. Elections and potential unemployment are great political motivators.
February 3, 2013
A. Sedgwick: “It is no wonder that there appears to be momentum to get rid of the dynamic duo before 2015…”
NOW would not be too soon.
February 5, 2013
Nicol Sinclair: “NOW would not be too soon.”
They cannot, as soon as a move is made to take the Tory party establishment back to something more attune to its supporters, the likes of Ken Clarke would cause a civil war that would destroy the party.
The Tory party is paralyzed, it cannot do anything the status quo suits the EUrophiles and that is why it looks like a placid lake, but there is a volcano waiting to erupt beneath the surface.
February 3, 2013
You remind us yet again that this Conservative led coalition is as much tax and spend as Labour. You have confirmed for us that there is no difference in economic mismanagement amongst the three main parties in Westminster. Whatever happened to Osborne’s statement that he would reduce the structural deficit by 80% spending cuts and 20% tax increases? The mendacity and incompetence of your party leaders is appalling. You know what needs to be done but your views are ignored whilst the debt has now risen from £616.9 billion at the end of the tax year 2009/10 to stand at £1.14 trillion today and rising. The plan was to double the debt in just 5 years – a target they will not only meet but easily surpass. Why does Cameron keep saying that ‘you cannot cure a debt crisis by borrowing’ when that is what he is doing and always planned to do from day one in Downing Street? He then tells us that he is paying down the debt. The man can’t be so ignorant but he has a first class grasp of mendacity. He certainly is the heir to Blair – the one statement he has delivered on.
February 3, 2013
Worse than “tax and spend” it is “tax, borrow and waste”.
February 4, 2013
Agreed!
February 3, 2013
Too little, too late.
No real attempt to control spending or costs.
When its not your money it seems that “who cares” is the attitude to more spending.
Until Government gets a grip, a real grip we will continue to drift towards the rapids.
February 3, 2013
John
Why is Mr Cameron pledging a 40% increase in foreign aid ?
From 0.5% of GDP to 0.7%
Surely we have had enough lessons of most of this money being abused in the past.
The British public are very generous when it comes to giving, for direct aid, why not just leave it at that.
Or is aid just used as a bribe, in the hope of something in return.
February 3, 2013
I could go further.
Why should the government run Social Services? Or help the NGOs? Or put any money into Charity?
Actually, being like that, I would go on to question the sacred cows of Education and Health too.
The new Archbishop is completely right. The Churches (including the mosques, the gurdwaras and the synagogues) understand this stuff much better than the soulless government which deals in numbers of votes, not people as people.
February 3, 2013
The coalition is running a misguided and ineffective tax policy that is not working the way they predicted. It is time to change that policy. But that change will not come while Cameron, Clegg and Osborne argue between themselves. Nor is it likely to come from a Miliband led government. In such circumstances the outcome is predictable; it will mean more devaluation, higher inflation, more destruction of savings and the savings culture, lower standards of living and public services. It will be a slow motion replay of the declines we already see in Greece and Spain.
February 3, 2013
like
February 3, 2013
Damm right.
I am an estate agent and I have witnessed the link between the increases in stamp dutt and the lowering of sales volume. Obviously this woukd lead to less revenue.
Stamp duty needs to be no more than 1% across the board if you want the housing marker back on it’s feet and if the government wants to generate all of the revenues that come from people moving. Its about time somone did the maths on this.
Well said.
February 3, 2013
Turnover taxes over about 1% are daft at up to 15% insane.
February 3, 2013
Stamp duty is prohibitive at just above average house values. No wonder people could otherwise afford to aren’t bothering to trade up.
February 3, 2013
As long as the average age of first time buyers is 38 cutting stamp duty to 1% is unlikely to help the housing market. Only reduced prices will help the housing market.
February 4, 2013
Here in London even if we could get an 800k mortgage we couldn’t find a family home in a good area. We could just about buy a 3-bedroom apartment in a good area.
The stamp duty for that is 32k. Don’t know about you, but it takes us about 2 years of saving every penny to get that kind of cash.
Otherwise said, for two years we’d have to work for subsistence alone, with EVERYTHING else being taken by the state. Effective tax rate of 80%+. For the privilege of buying a mangy 3-bedroom flat.
February 4, 2013
You need to get on your bike.
February 5, 2013
Bazman: “You need to get on your bike.”
London, he/she already did!
February 3, 2013
“They needed all this extra tax to cut the deficit, as Labour had been spending so much more than it collected in revenue.”
Of course the reason for this ‘spending’ is not mentioned, was it to fund single mother and baby day-care, or perhaps it was spent on new council housing scheme, or was it spent on bailing out (to protect the ordinary person and business in the high street) the reckless banking and financial sectors whose house had finally come tumbling down after 20 years of deregulation or light touch regulation?…
February 3, 2013
The defecit is not rocket science. You are spending more than you are receiving. Simple answer stop spending, something you have either not grasped or lack the political courage to face.
Second point is that the more you tax the less you receive. Removing money in excess from the enterprising encourages them to avoid the process or get out altogether. Net result, you increase the defecit even more.
Conservatives should not be surprised because this is not a conservative government led by a conservative prime minister. They are collectively metro socialists, detatched from reality by their own wealth. Remember, socialists spend other peoples money until it runs out. This is just what they are doing and ensuring the demise of GB in the process. Those conservative MPs who sit on their hands saying nothing can be done will go down the pan in 2015 just like their so called leadership.
February 3, 2013
Second point is that the more you tax the less you receive.
If that was true the optimal tax rate would be 1%. Actual economists have shown that raising taxes always generate more money as long as you have effective ways to prevent tax avoidance and evasion.
February 3, 2013
‘Actual economists’ have ‘shown’ no such thing. The key point is that raising rates encourages avoidance and incentivises individuals and businesses either to re-locate, or not to bother maximising income. There is so much evidence to support JR’s statement that lower rates and fewer breaks maximises revenues it is barely worth the debate. The Left should be more honest. High tax rates arn’t about maximising revenues, they are about equality and increasing the power of the state.
February 4, 2013
If there’s so much evidence why didn’t you provide any in your post? Surely you should be able to find the research of one economist who agrees with you.
February 6, 2013
Laffer, Mises, Hayek, Rothbard, Friedman. They’re all excellent reading (even if you dont agree with them). Put that down in your diary for a wet weekend one day this spring.
February 3, 2013
Check out Laffer Curve
February 4, 2013
Even the Laffer Curve shows that if taxes are too low you won’t get the maximum amount of taxation. The Laffer Curve has never stated that cutting taxes always leads to more money.
February 3, 2013
The point is it is a curve! You get nothing at 0% and virtually nothing at 100% somewhere in between at about 35%% you get maximum tax revenue. But for the best good for the most people, on average, you want something rather more like 20-25%.
February 4, 2013
That was exactly the point I was making.Up the percentage beyond the figure you suggest and people start avoiding and the lower the tax take.
February 4, 2013
Care to provide any evidence that shows why 35% is the best level. Research by Fullerton has shown that a 70% tax rate produces the maximum tax revenue.
http://www.dictionaryofeconomics.com/article?id=pde2008_L000015
February 3, 2013
So a tax rate of 100% is the optimal rate, is that what you are claiming?
February 4, 2013
Seems like you had little to say about the Laffer curve in this post when me and richard1 where discussing it.
http://johnredwoodsdiary.com/2013/01/23/how-a-higher-tax-rate-led-to-less-tax-revenue/#comments
But now feel free to wheel out your fantasies during a love in. Any reason?
February 4, 2013
I never claimed that and I have no idea why you would think that I did.
February 4, 2013
Just following the logic of your statement that raising taxes always produces more revenue Uni.
Either you believe this or as you stated in other posts that there is an optimal rate to maximise revenues.
You can’t have it both ways.
February 3, 2013
Look at that headline plastered over some of yesterdays papers that the chancellor is going to give a tax break to married couples .
Whether people agree with it or not , it is a political decision (if their is truth in the rumour) .
Does anyone in Westminster even considered whether actions like this simplify or complicate the tax system or is “fairness” the only criteria ?
February 3, 2013
Mr Redwood they won’t put you in the Cabinet as your views are fare too sensible and cut to the very heart of the issues. Your leaders like fudge so they can pretend they care or are doing something.
If we left the EU and stopped foreign aid that would save £22 billion net annually. There would also be additional unknown but significant billions of savings of 3 million peoples health, housing, education, benefits, and other public services provision. Fishing and CAP reforms. The Country is in a deep mess due to the policies of our current and previous political leaders. We need radical reform of our political system and administration as Westminster is the cause of these problems NOT the solution. We hear constantly how other public servants are needing or being reformed but NOT our politicians! We desperately need change as 3-4 people can decide policy without true national accountability. Lords Reform, AV votes, gay marriage, green policy etc.
February 3, 2013
@Timeaction
Maybe we should move towards a Swiss style system?
Major issues to be decided by plebiscite?
February 3, 2013
Oh we do not want to become a Greater Switzerland do we? For some Cameron yet to be specified reason.
February 3, 2013
What, a system that allows citizens to petition for and get a referendum as of right?
Obviously we don’t want that; we want our present system which enables the Prime Minister to SELL us a referendum, his price being our votes for his party at the next election.
🙂
February 3, 2013
Sounds good as long as only those who would have to pick up the tab get to vote.
February 3, 2013
I submitted a reply here, and it appeared as awaiting moderation, but now it has completely disappeared.
February 3, 2013
As a single person I’m happy to contribute some tax to help bring up other peoples children .
Clearly parents need tax breaks because the children are the nations future . Also I’m sick and tired of HM Govt using falling birth rates as an excuse for them importing more immigrants .
However , almost every budget for the last 30 years has seen a trend :-
– increased breaks for families and increased tax for single people
– increased access to benefits and entitlements (except for the entitlement of free university education)
– increased level of benefits
– an assumption that higher wages is the answer rather than lower cost of living
Doesn’t there come a time when the trends should stop ? i.e. when the tax system is sufficiently biased towards people with children and benefits become just the right level ?
No Government is trying to sort out the underlying problems like runaway accommodation costs . They are just using benefits to fan the flames .
These benefits don’t even benefit the poor , they benefit landowners and landlords .
February 3, 2013
Reported in the Sunday times today:- new figures show 14% of tax payers pay over 60% of all income tax.
Why on earth do these four million people not get better accountants or leave the country one wonders? Then the government might finally have to start doing what is needed. A halving of the state sector and the lowering of state sector pay and pension to private sector levels.
Clearly Cameron and Osborne are not going to do it by choice.
February 3, 2013
The main reason is that the personal allowance always skews the curve towards the wealthy because it effects lows salaries more than higher ones.
For example if the personal allowance is £10,000, the flat tax rate is 40%, person A earns £12,000, and person B earns £120,000 then they’ll pay the following amounts of tax.
Person A’s salary: £12,000
Person A’s salary – personal allowance: £2,000
Person A’s taxes (40%): £800
Person B’s salary: £120,000
Person B’s salary – personal allowance: £110,000
Person B’s taxes (40%): £44,000
So due to the effect of the personal allowance Person B pays 55 times more in taxes than Person A even though Person B only earns 10 times more than Person A.
If assume that there are ten people earning Person A’s salary and one person earning Person B’s salary then the total amount paid in taxes is £52,000, of which Person B pays 84.6%, even though one Person B is paid the same as ten Person A’s.
In conclusion just because the wealthy pay a higher proportion of the total income tax revenues doesn’t mean that they’re being abused in any way. Also the only way to reduce this is to reduce the difference in salaries between the highest paid and the lowest paid.
February 3, 2013
@uanime5
“the ‘only’ way to reduce this is to reduce the difference in salaries between the highest paid and the lowest paid”
You clearly lack much imagination, there are countless other ways that are far more sensible than that.
February 4, 2013
Lifelogic unless you want to remove personal allowances there’s no other way to reduce the percentage of tax paid by the wealthy. Even using a flat tax the wealthy will make a up a larger proportion of the tax take because the personal allowance is a smaller part of their salary.
Here’s the maths to prove this.
Person A’s salary: £12,000
Person A’s salary minus personal allowance: £2,000
Percentage of Person A’s salary not taxable due to the personal allowance: 83%
Person B’s salary: £120,000
Person B’s salary minus personal allowance: £110,000
Percentage of Person B’s salary not taxable due to the personal allowance: 8.3%
So it’s no surprise that Person A makes up such as small proportion of the tax revenues when only 17% of their salary is subject to income tax (unlike Person B where 91.7% of their salary is subject to income tax).
For comparison here’s how much tax Persons A and B would pay if there was no personal allowance.
Person A’s salary: £12,000
Person A’s taxes (40%): £4,800
Person B’s salary: £120,000
Person B’s taxes (40%): £48,000
So in this above example with no personal allowance Person B earns ten times more than Person A and pays 10 times more tax because the personal allowance isn’t making the majority of Person A’s salary untaxable. Though I doubt removing the personal allowance would be politically viable because it would cause major harm to the poorest and provide no benefit to the rich.
In conclusion the wealthy will always seem to be paying more in taxes as their personal allowances effects a smaller percentage of their salaries than the same personal allowances will effect someone on a lower salary. No amount of whining about how unfair this is will change this.
So lifelogic unless you have another solution to this that won’t result in a riot reducing the difference in salaries is the only way to reduce the percentage of taxes that the wealthy pay.
February 3, 2013
Are your figures for personal allowances meant to be accurate ?
Where do you get them from ?
February 4, 2013
In this example I simplified everything to make it easier to understand. That’s why someone earning over £100,000 still has a personal allowance and why a flat tax was used.
February 3, 2013
Nobody says they are being abused Uni, but it is a fact that a small number of very wealthy people pay a disproportionately large amount of income tax.
Therefore, we need more millionaires in the UK not less if we want more tax revenues and people on lower incomes paying no tax.
Don’t you agree?
February 4, 2013
I showed that the wealthy seem to be paying more because of the personal allowance skews the curve towards the wealthy. The amount they pay isn’t disproportionate even when taxed at the same rate as someone on a lower salary.
More millionaires isn’t the only way to increase tax revenues. If Person A was earning £24,000 instead of £12,000 then they would pay £5,600 in taxes; so Person B would be earning 5 times their salary and be paying 7.9 times the amount of taxes. Quite different from earning 10 times Person A’s salary and paying 55 times the amount of tax.
It would also mean that if five people earned Person A’s salary and one person earned Person B’s salary that the total tax revenues would be £72,000 and Person B would be contributing 61% of the tax revenues, rather than 84.6%.
So no we don’t need more millionaires, we need less low paid workers.
February 4, 2013
Uni,
You are talking about what might be, sometime in the future.
Your post is covered in the word if, if this were to happen, if that were to happen.
If you were to look at current actual figures you will see how much of the total income tax the richest few percent pay.
Its a fact.It is actually happening now.
Unlike your hoped for future.
February 6, 2013
What we need are lower total public sector payroll costs. Where the balance is struck between redundancies, a pay freeze (without automatic time serving payments), regional pay and less generous pensions I will leave to HM Government and your beloved unions.
February 4, 2013
I think that in your example person B is being abused.
Since they have the same access to public services, they should really pay the same amount of tax, e.g. 300 pounds.
February 4, 2013
In my example Person B pays the same rate of tax and gets the tax exceptions as Person A. Just because they have to pay more tax because they earn more doesn’t mean they’re being abused.
February 4, 2013
The simple answer is that we live in a democracy and the people who benefit the most should pay the most. Don’t start telling us the rich create jobs as they do not any more than squirrels invented evolution. Demand crates jobs and there can never be enough demand from rich individuals.
February 5, 2013
Baz,
If you want taxes to pay for a large and generous welfare state with no income tax for those on low incomes, then you need to encourage the wealthy to contribute and contribute even more.
It seems to me that therefore you need lots of them to feed off.
If you are talking about demand creation, then this is a different economic problem which is probably best solved by the majority having a high standard of living.
So the key political question is, how do we get to this wealthy promised land for all?
Your answer is perhaps via the promotion of equality of incomes.
Tax the rich into extinction and then spread the money around.
I would say tax the rich carefully. Seduce them to stay in theUK and set rates so they pay the maximum possible.
Equality isnt the answer. It ends with poverty for all.
February 3, 2013
A depressing picture which puts the Tories in the same light as labour we thought we had seen the back of…..
February 3, 2013
A Conservative led coalition government that spends more, taxes more, wastes more, cuts defense spending more (whilst starting more wars) than the previous appalling Labour government.
I wonder whether it’s just voters economic ignorance that allows these morons to get elected but it’s probably not, after all there is no real choice is offered by our “democracy”. One side wears red ties, the other blue, apart from that you’d be hard pressed to tell the difference.
February 3, 2013
There is no real choice because the ones pulling the strings are the same. I’m sure that you know who the string pullers are.
February 3, 2013
Apart from all else, which is saying a lot, given that the Government is run if that’s the word by a bunch of PR merchants, you would have thought they could have done a better job defending themselves but, No, as with much else they are perfectly useless, in particular why do they not robustly reject the “5% tax reduction” criticism so repetitively thrown at them by saying that the substance of what happened was that, against their better judgement, they allowed a rise (from 40% to 45%). Also their handling of whether there is or is not “austerity” beggars belief–allowing themselves no credit at either end of the argument. Amid all this all they can, suicidally, wax on about is homosexual non procreational “marriage” and other panderings to their away-with-the-fairies Coalition partners, inviting the further contempt of myriads of their former supporters.
February 3, 2013
Reported today, the PRM thought that tax breaks for married couples would be a way of buying off the anti gay marriage rebellion. This would not be too popular with unmarried couples with children, who would see their non procreating married gay friends being subsidised at their expense. Fortunately this appears to have been stopped.
February 3, 2013
I find it repugnant that the issue of gay marriage draws more interest than the issue of gay couples adopting children .
I know of one couple who have moved overseas in the hope to adopt a child because social services don’t consider heterosexual people with good jobs who try to do the right thing suitable parents for vulnerable children .
We see in France too that the “rights for gays to have children” is strongly supported in recent protests but that the rights of children don’t count .
Can I beg that the coalition sacks those social workers and councilors who are responsible for these (unhelpful views for -ed) children please ?
February 3, 2013
I have recently had some contact with local and national government offices though my work.
I was in a town hall where the offices were plush and staff were plentiful.
By contrast, walking outside the town hall I was met with plenty of boarded up shops/offices and some empty factories.
The town hall felt like a royal palace where the royal court did not understand that it was their extravagance that was partly responsible for the neglect around them.
Excessive wasteful public spending is killing us. Perpetuating and encouraging it with yet more tax is a recipe for ever more poverty.
What do I do about it? Nothing of course. We rely on public spending as so many businesses do nowadays.
I am on the gravy train as well. In that respect, I am as corrupt as the rest of them.
February 3, 2013
@Kenneth
“I am on the gravy train as well. In that respect, I am as corrupt as the rest of them.”
In other words State dependent?
February 3, 2013
Indeed, state dependant – or at least partially so.
With the state taking up half of the national income, it is little wonder why many of us rely so heavily on the state, and why so many business people keep their disgust very quiet and hide behind anonymous posts like my one.
February 3, 2013
While I agree with the general tone of this blog there does also need to be a concentration on reducing taxes where it will have the most effect. Thus for example a reduction in employers’ NI particularly for smaller companies will have major implications on their cash flow and the number of people that they can employ. This is a much more effective use of the tax reduction than reducing the corporation tax rate applied to the same companies.
There are also areas where a change to the tax regime that increases the tax take has advantages. An example here is the introduction of two higher bands of council tax and the restriction of the single person occupancy allowance to (a maximum of?) the rate applicable to band D. This would also give some relief in the lower bands
Looking at benefits rather than removing things like the winter fuel allowance, free bus passes etc. they should be made taxable. Every member of a household that receives the winter fuel allowance should be taxed on that allowance. It annoys me intensely that a local household that includes four working adults all on fairly high salaries claims because it also includes an elderly grandmother gets the winter fuel allowance. My scheme would actually make them pay 100% tax in total on that allowance.
February 3, 2013
I’ve always been bothered about hitting the wealth-creators too hard. The ones the Labour party constantly moan about (you know the mantra, giving tax breaks to millionaires, whilst to poor get poorer, or the ones than Denis Healey wanted to soak until the pips squeaked). Without entrepreneurial wealth-creation, we might as well switch the lights off now, because we have no future!
Britain needs a vibrant, fluid economy, where the money supply keeps on circulating. Labour would take us back to the dark satanic days of state ownership if they could, but I’m disappointed in the present administration. They haven’t done nearly enough to tip the balance in favour of the wealth-creator, in whom our collective futures all depend. They’ve been far too much like the administration they replaced.
The chief concern from those on the left seems to pivot around employment laws and the rights of an individual not to be exploited. They rightly resist anything which would take them back to the dark days of 100 years ago, and had I lived in those times, I too would have been a trades unionist, fighting for a more equitable and even social policy, but the world has moved on. Interesting though, that a certain high-ranking female figure on the opposition front bench, regards ALL work as a form of exploitation! That isn’t to champion the cause of the working man, that is to champion the cause of the looney bin! Without a society engaged in paid toil of some description, we’ve got nothing at all – zilch!
So without incentives for people to do better, and that includes those who would like to develop and grow their own businesses, it all falls down. But why should this government, of all governments, place a millstone around so many necks in the form of a higher tax burden that effectively makes so many investors think again?
Surely, if they want to reverse and even undo all the damage Labour did, they should move in a different low-tax direction. Labour, as we know (or at least, should know) borrowed massively, and lived on tick, to fund their social prospectus. It didn’t work, and now we’re all paying the price, including the less well off. But by incentivising wealth-creation at every level, and importantly, attracting inward investment, we can still have the important parts of it, paid for not by debt, but by a greater overall tax take, and one that is more broadly-based and more equal. A lower rate of corporation tax would be a good place to start.
Tad Davison
Cambridge
February 3, 2013
@Tad
Anyone with an ounce of sense knows that low tax would be the solution, even if borrowing increased over the short term, because it would kick start the economy and the resulting growth would very quickly convert the deficit into a surplus.
” I’m disappointed in the present administration…
They’ve been far too much like the administration they replaced.”
If voting changed anything, they’d abolish it.
Ken Livingstone
February 3, 2013
Really nothing strengthens the overall position of the working man more than the possibility of leaving an unsatisfactory employer and moving to another job where he’ll be treated better.
Which is why employers don’t like the domestic labour force to be fully employed and will always press for the right to import cheaper and more biddable workers from abroad as they see fit, with support for the unemployed to be provided by the state to which the employers will contribute as little as possible.
February 3, 2013
Exactly .
This is the price which has to be paid for our financial services industry to gain access to Indian markets .
The left still things you can have easy-hire and hard-fire .
If they were out of work they would know differently .
February 3, 2013
Firstly you’ve made the mistake of assuming that all entrepreneurial wealth-creater are wealthy; they’re not. Indeed many people who are wealthy don’t create wealth, such as a lot of the people who work in the City.
Secondly employees are still being abused by their employers and need legislation to protect them from discrimination, harassment, and dangerous workplaces.
Thirdly you assume that creating new businesses is the only way to improve the UK even though improving existing businesses is a viable alternative.
Fourthly at least when Labour was borrowing we had growth. By contrast the Coalition’s borrowing isn’t resulting in any growth.
Reply 2008-10 when Labour was at the peak of its borrowing we had the worst recession in post war history.
February 4, 2013
John I suspect that Labour had to borrow more after the recession to bail the banks out and to stimulate the economy until it recovered.
February 3, 2013
“The country cannot carry on living on a rising overdraft for ever.”
Well, to be perfectly clear about this, it’s the government of the country that is “living on a rising overdraft”, and that debt is directly owed to its creditors by the government and only indirectly owed by the country thanks to its incompetent government; but it seems that some people do think that the government can “carry on living on a rising overdraft for ever”, and some of them justify that by arguing that if necessary the government can carry on getting the Bank of England to create and indirectly lend it more new money for ever; and it’s really down to backbench MPs to assert the rights of the Commons on our behalf and insist that as the creation of these vast sums of new money is akin to taxation then like taxation it should be under the control of the Commons, not the Chancellor.
February 3, 2013
The clamour to tax the rich is nothing to do with raising revenue, it’s just pandering to envy politics, just like closing grammar schools did nothing to improve social mobility, quite the opposite in fact.
The Tories are dancing to Labour’s tune, so what is the point in voting for them?
February 3, 2013
Common sense – as usual – BUT why can’t the Treasury see it????
February 3, 2013
The question must be, why are you still in the Conservative party when DC and his cronies are doing just about everything wrong, and betraying just about every Conservative value.
February 3, 2013
I am not but JR is I assume because the Conservative Party has a brand that could still win elections. Just a shame it is being trashed by Cameron.
February 3, 2013
Dr. JR I’ve argued on your blog site before that our system of tax collection is far too complicated and that it should be scrapped in favour of a system of tax on purchases – if you spend you pay , if you don’t spend you don’t pay tax . You’ve agreed that VAT increase was the only method that resulted in more revenue ; carry this further to obtain the revenue goal required .
February 3, 2013
Not necessarily as simple and effective as you think. Within the last couple of hours I have updated some software on my computer, the software is written by an Australian company.
The financial transaction is handled by a German company. The 19% VAT I have paid will go to and remain with the German Government.
February 3, 2013
Far and away the best way to collect more tax is to let the economy grow, since there will be more money available and it is possible to collect it without as much pain. Almost all our problems would be ameliorated or solved by growth.
What a pity the LabConDem cartel is actively preventing growth.
February 3, 2013
Perhaps now is the time for Mr Cameron to stop giving the money away on overseas aid and the EU until, we have got our own house in order . Once this country is back on its feet then perhaps we can think about other things .
February 3, 2013
Do I have to fill this in every time for the new system?
February 3, 2013
Balancing expenditure against income seems to be incomprehensible to Politicians either National or EU. Could this be due to their enslavement by Permanent Civil Services?.
Remember Patrick Henry? his 1775 speech still rings true – ‘Give me freedom or give me death’.
February 3, 2013
If you want to see how far the tax codes have grown and become over-complicated just compare the Tolleys Tax Handbooks Yellow Orange for 1965 to 2012
1965 Pages 759 pages
203 2014 Pages 8,239
http://www.hm-treasury.gov.uk/d/ots_length_legislation_paper.pdf
February 3, 2013
We know the left do not subscribe to the Laffe curve which obviously extends to the Treasury staff. It is not that we do not have plenty of historical evidence that at a certain tax level point productivity falls we have. I have in my time experienced the the effects of tax being to high when I could not get my employers to work overtime because the tax take left too little to make it worth their while. You and many commenters to your articles predicted that revenue would fall due to the increases in taxes and it is of course proving to be correct. We have predicted many other things and no doubt we will be proved correct on those as well.
February 4, 2013
Your argument is flawed because if one company can’t do the work because no one will work overtime then another company will do the work. Thus reducing overtime results in more people being employed and the tax returns being similar.
February 5, 2013
By your logic Uni, if we all worked 10 hours per week there would be no unemployment.
The classic left wing fantasy.
February 3, 2013
Correction – employers should read employees
February 3, 2013
Too right Bob, so what’s that telling us, that the entire democratic process we presently have is just a sham?
Looking at the way we’re been drawn ever-closer to the politically-integrated EU maelstrom, without proper reference to the British people, would suggest it is.
Tad
February 3, 2013
If you include National Insurance contributions as taxation (bearing in mind that the state pension is likely to be denied many) then the rate of taxation is even higher than that.
Off topic please.
I’m pro gay marriage. However, it seems odd to me that we’ll be getting a vote on that long before an in/out referendum. Says it all really.
February 3, 2013
An ever more demanding state tries to extract ever larger greater taxes from an oppressed people. Parallels with the later Roman Empire?
February 3, 2013
“Tax, tax, and more tax.” Why? Because spend, spend, and more spend. The government is now alarmed at the conseqence of a massive influx from Bulgaria and Romania, (etc ed). Of course the government is purely alarmed of the negative consequence for their re-election prospects; if they were remotely concerned about the future of this country, they would have left the EU and stopped all third world immigration, entirely. It is not possible to control expenditure effectively if a major cause of that expenditure is uncontrolled.
Why does the Conservative Party from choice promote a non-Conservative leader and cabinet, whilst true Conservatives idle on the back benches engaging in occasional mighty debates to let off steam?
February 3, 2013
This week we have seen Mr Cameron committ this country to years of foreign aid. He does not have a mandate to do this. Its sheer madness while we have debts mounting each day; it has increased over the past year dramaticly, so how can any Tory shout loudly they are controlling spending. They are clearly not. Now we see we have punitive taxes imposed on many. For me this is the thin end of the wedge.
Mr R, we have people here using food banks as they cannot keep themselves or their childen on the money they have, or don’t have. These families have children, citizens of these islands we have fought and died to keep safe. How is it we have come down to this? During the last war, not many went hungry like this, if no meat they had plenty of vegetables. To see this happening makes me ashamed. Some people have clear views about unemployment, and benefit provision, but until you’ve been there yourself you’ve no idea what it’s like to live in sheer poverty. In many cases its not from choice; it’s been forced upon them by what life’s thrown at them, no one knows who’s next. I’m bitterly disappointed to read some comments, so selfish, so greedy, so unfeeling. Some would like the NHS removed, how would the poorest be able to afford health care? No, I would never accept that, and would fight to retain it with all my might, like many other. Tax is complicated thing, if you earn enough you should pay it, but not to the extent it fleeces people so much they fly away. Its jobs we need, its education and training we need, but not hatred and blind greed to furnish people’s pockets to the detriment of some.
February 3, 2013
thanks for posting this john its need a lot more publicity
February 3, 2013
I remember seeing Martin Sorrell being interviewed by Andrew Neil a couple of weeks or so ago. Of course he was against Mr Cameron giving any speech on the relationship with the EU. He wanted us to join the Euro and he amongst many doesn’t want any control of immigration.
The view of business leaders such as Martin Sorrell is a very narrow one. He will suggest we join the Euro but if we had he would have left the country as he did even though we didn’t join. He doesn’t have to live or pay for the infrastructure to cope with a population boom where no planning was made for the infrastructure. He can say we should join the inner core of the EU but if our business fails as a result he will leave again and won’t be bothered. The rest of us have much more to thing about. His earnings are international, he (probably has good tax advice-ed). We do need to know the views of people like him but also the very limited perspective from which it comes.
February 4, 2013
Jon ,
The views of business leaders such as Martin Sorrell are not only narrow but short-term and alas very common .
To them democracy , patriotism don’t even come into the equation . It’s all about amassing money in their lifetime and leaving the next generation to clean up the mess .
The same can be said about closing down of pension schemes . Can be dressed up anyway people like but the truth of the matter is that big business wanted access to peoples pensions without having to wait for them to retire .
They all love their companies and their money but they don’t love the UK .
You can see how the EU national-socialist model (integration of state and big business) is a good fit for them .
February 3, 2013
It all seems so simple when you look at the basics, or fundamentals really. Any business that makes a loss every month is bankrupt unless it has a pot of money from some source. This government has lost the battle now to recover our balance of payments its going the wrong way, so the deficit is being paid down by borrowing, how mad is that.
Further the borrowing is now out of control and we are throwing money around like it grows on trees. I think the Bank of England should arrest the Chancellor and the PM for criminal financial offences, if its a crime to trade whilst bankrupt it must be a graver offence to drag a country down.
Its no use standing up and lecturing the three MPs that could give a rats ar.e present in the chamber, get into the press with a load of like minded sensible mates and give DC and GO a good kicking. You have nothing to lose, especially after the latest marriage omni shambles. It wont be long before we have a bloke marrying his football team.
February 3, 2013
“They needed all this extra tax to cut the deficit, as Labour had been spending so much more than it collected in revenue.”
The coalition has been spending and borrowing even more than Labour. Perhaps you should blame the coalition for the deficit, since they control the budget.
“The higher rate of Income Tax accelerated the departure and the decline of high end incomes in the UK, and revenue fell sharply.”
Do you have any evidence to back this up? I trust you’re not basing this claim on the wildly optimistic predicted tax revenues which were dependent on high growth and the City recovering quickly.
“The richest are the ones who can afford to leave altogether, or who can rearrange their affairs to avoid tax legally whatever the regime.”
Maybe the Government should introduce laws limiting how much tax you can avoid. That would fix this problem.
February 3, 2013
unanime–You obviously don’t know people, as I personally do, who have left these shores nor their reasons for doing so, also you simply do not understand the meaning of tax avoidance because if you did you would realise that the idea of measuring “it” (there is no “it”) is simply fatuous.
February 4, 2013
Did these people take their jobs with them? If not then there wasn’t any loss of tax revenue.
February 6, 2013
unanime–Your imagination when it comes to talking baloney is as usual very impressive. Not all “jobs” are of the factory floor type with adverts in the paper, not that I am disparaging such jobs. Ever heard of the self-employed, entrepreneurs, owners of companies??
February 3, 2013
Uni,
I love your bit about the Coalition borrowing an spending more than Labour.
Given you keep telling us there have been savage cuts, I’m thinking you are getting a bit confused.
February 4, 2013
Savage cuts that are being paid for by increased benefits. You are the one who is confused and as for the rich leaving. Bluffs need to be called.
February 4, 2013
“savage cuts that are being paid for by increased benefits”?
Now I am confused.
You have to agree that in many posts uni is banging on about the savage cuts and the next he writes that the coalition is spending more than Labour
Then you say Im confused!
Hilarious both of you.
February 5, 2013
You think cuts have no economic knock on to the economy? The job cuts have no consequences, the person just gets another job that pays the same or more and does not claim any benefits or spend less? The reduced government spending is just absorbed by the economy as it was all just wasteful anyway, the money saved in taxes is immediately and instantaneously used to create more jobs in the private sector. You are right this is exactly how it happens.
February 5, 2013
What reduced Government spending???
Its going up!
February 5, 2013
Because of the reduced tax take and increased costs due to benefits being paid out caused by the cuts on top of a recession. Understand that? It ain’t rocket science, but might be heresy to some.
February 6, 2013
Nonsense, you are confusing political choices on tax and spending with total Govenment spending.
We have plenty of money for HS2 and wars overseas and overseas aid increases but not for other things.
However the annual total Government spending is going up in real terms.
Its a fact.
February 3, 2013
My main question being. Is being an idiot cheap?
February 3, 2013
http://www.express.co.uk/posts/view/373593/-Back-door-will-let-in-20-000-migrants
February 4, 2013
Destroying U.K. I.T. professionals livelihoods is a price well worth paying to secure access to the Indian market for UK banks .
As an I.T. professional I earned 8% less last year than 6 years ago and it will only get worse (if more lower paid people-ed) arrive .
February 4, 2013
“Fewer breaks and lower rates”. It’s from the same stable as “Taxes should be low and everybody should pay them.” And it’s absolutely right.
February 7, 2013
The Institute For Fiscal Studies states that large increases in taxation will be required after the next general election of around £10-12 billion. Wages are not keeping up with inflation and with all these future tax rises demand has to fall. Austerity without end and low economic growth are the UK future.