George Osborne made a most important statement at the Treasury Committee on Thursday. He said a Conservative government if elected  would  not need more tax rises in the next Parliament. Further moves to get the deficit under control would be achieved by a slower pace of spending gr0wth, and by the natural buoyancy of existing taxes, not by more rises. I agree. The UK’s problem is not that tax rates are too low, or too few things are taxed.
Presumably Labour and Lib Dems will disagree with this approach. They seem to be busy trying to find more ways to tax us.
July 13, 2013
JR you have got to be kidding, no more tax rises eh? IDS has done absolutely nothing meaningful to cut down the benefits bill. I do not seem to see any sink estates being cleared of dependancy and all those claimants now in work and paying their whack. While walking the streets of Bristol I now hear a lot of Spanish being spoken, so after the East Europeans, its now the turn of the South Europeans to come and help themselves. Its also rumoured that the NHS budget is no longer to be ring fenced. Try cutting a nurses benefits at the moment when all you MPs are going to get a nice big fat healthy pay rise. Its obvious Osborne the history graduate learned nothing from Labours attempt to cut public spending from 1976 onwards and how that eventually led to the ‘winter of discontent”.
You know fine well the levels of public and private debt in the UK and the economy’s current enfeebled state. So to be in a position to suggest that taxes will not be going up is either a “big lie” or Osborne is even more out of his depth than I thought he was. This is the sort of rubbish I would expect from Labour. Perhaps you can do a few articles based on the sums on how this is all possible?
July 13, 2013
@Nina Andreeva: IDS can’t do anything, he isn’t in charge of either the Treasury nor BIS, in fact all IDS is doing is costing the tax payer even more money due to his unworkable changes – JSA already has enough rules to prevent bogus claims, they just need to be used. People can’t get jobs if there are no (real) jobs to he had, and politicians quoting total numbers of jobs found on employment website is very misleading as many because an agency might not be the sole agent and many agencies list non-jobs that are simply bait to get people to sign up for their services which then makes the agency look more appealing to their (employer) clients.
The last time I visited Spain, I heard a lot of English being spoken, so perhaps the English are going there to “help themselves” to the Spanish hospitality, of which a lot of British ex-pats (and holiday makers, far to intent on the sun, sea and sangria) do actually do. I suspect that the number of Spanish using our NHS is a lot less than the numbers of UK ex-pats using the Spanish health services!
Totally agree with your assessment of Mt Osborne though… đ
July 14, 2013
Oh dear Jerry
Once again talking utter nonsense about things which are totally outside your knowledge.
There are millions of well paid jobs available. 7.1 million were advertised on UK internet job boards last year, increasingly larger numbers advertised by employers directly NOT agencies.
Here’s a question you should ask yourself. It cost money to advertise jobs so why would an agency advertise a job they haven’t got? Why would they advertise it twice unless they hadn’t filled it for the first time.
Why would an agency gather unsolicited CV’s if there as you claim aren’t any jobs? Why would they do that if there where jobs? If an agency want CV’s they just download them from the job board provider.
Its true that 2 or more agents may have the same job opening but that is a very small number
There are massive skills shortages in the UK in STEM jobs, vehicle maintenance, engineering, IT, digital media, teaching, healthcare and manufacturing. Less than 10-12% are at minimum wage or part time
You socialists make it up as you go along.
July 15, 2013
@libertarian: “Once again talking utter nonsense about things which are totally outside your knowledge.”
Indeed you are libertarian.
“There are millions of well paid jobs available. 7.1 million were advertised on UK internet job boards last year, increasingly larger numbers advertised by employers directly NOT agencies.”
Unfortunately even if true, 99% of the population are not Jack of all trades, but masters of none, like you libertarian…
“Why would an agency gather unsolicited CVâs if there as you claim arenât any jobs?”
To make them look better suited to find their clients (the employer) the staff they need.
“Its true that 2 or more agents may have the same job opening but that is a very small number”
If you knew anything about the subject you would actually know how common it is, some agencies are even cut ‘n’ pasting other agencies adverts as their own – never mind the fact that doing so is more obvious than a sore thumb.
“There are massive skills shortages in the UK in STEM jobs, vehicle maintenance, engineering, IT, digital media, teaching, healthcare and manufacturing. Less than 10-12% are at minimum wage or part time”
Indeed but that is a nice place to loop back to your claim about 7.1 million jobs being available above and my reply, all need an element of skill or training and that is not (always) available nor suitable. Sorry but if I’m looking to employ a motor engineers then I want highly skilled mechanics, not someone who has barely been taught how to put a wheel on correctly, a rail engineering company will be looking for people who know one end of a locomotive from the other (would you libertarian?), whilst IT need people who know what a packet is and how it relates to a byte – or a bite for that mater, whilst science based jobs need people who know the difference between a test tube and a pipette tips or a watt and an ohm etc.
The only people making things up libertarian are the clueless (often work-shy) right-wingers like you, how was the round of golf today, no doubt the 19th went down very well in this heat, a hole in one was it?…
July 16, 2013
Well Jerry,
let me tell you what i did today I concentrated on running the online job board ( in top 10 in UK ) that I own and operate.
I’ve never played golf. I’ve run online recruitment businesess for nearly 2o years.
You are talking complete and utter twaddle, you have not a single clue about the job market how it works or what is happening.
Your rant about skills has nothing what so ever to do with what you posted and how I proved you wrong.
If recruitment agencies want CV’s they download them they don’t need to advertise fictitious jobs to get them.
People like you who talk total rubbish are what holds this country back.
etc ed
July 17, 2013
@libertarian: I suppose you write speeches for IDS too, considering you use the same sort of buzz words and phrases…
Clue, most people still do not upload CV’s, what is more many will never do so, that is one reason why IDS can’t get his UJM site running as he intended. If you really do run a online recruitment businesses you need to start talking to the real world, not your fake world were everyone is a jack of all trades and that5 there are 7.1m unique jobs available…
Reply I do not write speeches for anyone. I just speak.
July 17, 2013
Dear Jerry
Well at least you consistently talk rubbish.
We have more than 560,000 CV’s uploaded by job seekers in the last 3 months.
No I don’t write speeches and I’m NOT a Tory. I’m not a supporter of IDS.Your jack of all trades jibe is garbage. The skills shortages are the opposite of jack of all trades. I’m just telling you the facts. Hey though why let reality enter into your world?
Oh by the way we are currently advertising today more than 500 trainee or graduate jobs and more than 300 apprenticeships. Thats an average day.
I’d give up if I were you, you know nothing about the job market
July 17, 2013
@JR reply: Sorry If I caused confusion John, I wasn’t suggesting you do, I was suggesting that someone else is using the very same buzz words and phrases as IDS has used.
@libertarian: “We have more than 560,000 CVâs uploaded by job seekers in the last 3 months.”
Bully for you, now do remind me, what is the current adult population of the UK, how many are officially unemployed (never mind the non unemployed looking to move jobs), what percentage of the working population do not have access to the internet to be able to upload a CV (part of the rational behind the UJM scheme)?
As for skills, if the unemployed are unskilled how are you going to expect any to fill skilled vacancies, are you really suggesting to would send an EDF the CV’s of a bin-men if they wanted to recruit nuclear scientists – if you did you would be laughed out of business and you know it! Stop living in a vacuum of your own making and talking piffle just to try and defend you industry.
July 18, 2013
Jerry
Give it up youre just making yourself look silly.
You told us no one uploads CV’s to a job board. I told you how many were uploaded to mine in the last 3 months. You do know there are 100’s of job boards don’t you and all of them have cv uploads.
You really are clueless.
The skills shortages are people with the necessary qualifications and experiences. Obviously
You seem to think that the whole of the 2.5 million unemployed are useless, untalented layabouts with no skills. What a derogatory attitude you have Jerry.
A large proportion of the unemployed are NEATS who actually have degrees and qualifications. They just need the right type of help to get on the job ladder. That help does not come from left wing bigots like you who continually peddle the myth that there are no jobs
80% of the UK population have internet access at home
92% of UK population have a mobile phone ( you can use my job board via a mobile )
Of those who don’t have access and who are looking for work. The job centres, libraries, school, colleges and CAB’s all offer internet access for the job search.
Stop displaying your total ignorance Jerry
I’m not a recruitment consultant I run a job board. I don’t send CV’s to anyone.
Job applicants send their CV’s to employers they would like to work for. Alternatively employers search our cv database and contact job seekers they like the look of.
The small proportion of people fit for work, who have no experience and no qualifications can still find work. I told you what the skills shortages were not the total amount of work available. There is plenty of work around for the unskilled too.
I work as an upaid Director of a charity that finds work for adults with learning disabilities. I can find those guys work. I also work with ex offenders and whilst its true that its harder to find them work it can still be done
As I said Jerry, change the subject to something you know about
July 13, 2013
Both Cameron and Osborne said they were low tax conservatives and there has been over299tax rises since the election. Both cannot be trusted. It is spin to grab a headline and no intention of delivering. Same old same old.
July 13, 2013
299 tax increases is it? Tax borrow and waste in every direction. They cannot even check the invoices from G4s and Serco before paying them it seems.
July 13, 2013
You cannot be serious! He is up there with the worst post war Chancellors of the Exchequer.
July 13, 2013
Well they are at the point where increasing tax rates raises little anyway, it just destroys more of the economy. But they will need to stop wasting money everywhere, so much fat to cut yet they still have an insane energy policy, hs2 and other mad project in every direction. Less than two years left and they have done nothing. What is Osborne’s view on IHT nowadays, after his blatant ratting on the ÂŁ1M threshold? Will it be more empty promises again at the next election? I cannot see how they can possibly win, not even against the useless, state sector union place man, Miliband.
July 13, 2013
It’s just a promise by a politician, and as it’s not legally enforceable it’s worthless. Now if Osborne was to agree to a legally binding trust arrangement whereby he deposited say ÂŁ10 million of his own money into an escrow account, which money he could only recover once he had fulfilled his promise, then that might be worth something.
July 13, 2013
Osborne & Cameron would still find some small print, he might say it was not a tax at all but a new licence fee, mere national “insurance” increases, some new obligatory state insurance or forced pension contribution, a TV licence fee, a 4G, 5G airwaves tax.
Just as Cameron claimed the Lisbon Treaty was not a constitution and bizarrely even claimed that “a Treaty” (that had become law) was magically no longer “a Treaty”. Lies lies lies he simply cannot be trusted one thou nor one millimeter as he might have it.
July 13, 2013
This is the same Mr Osborne who promised to eliminate the government deficit in 5 years by 80% spending cuts and 20% tax increases. You showed us, back in 2010, that he jettisoned that pledge as soon as he entered Downing Street. Not only did he abandon the deficit reduction plan, what reduction there has been was as a result of tax increases. The net debt figure when Osborne took over was ÂŁ759.5 billion. In his first budget Osborne planned to increase it to ÂŁ1350billion by tax year ending 2014-15. The latest OBR figures, in this year’s budget, show a projection of ÂŁ1398billion for that year increasing to ÂŁ1637billion in the year 2017-18. The man has failed and in the process grossly misled the country with all his talk of cuts when he always planned to increase total government spending. I am sorry but such flagrant deceit cannot be ignored, forgotten or excused. The man has shown himself to be totally untrustworthy and I don’t believe a word he says.
July 13, 2013
“George Osborne … said a Conservative government if elected would not need more tax rises in the next Parliament.”
When is the last time Osborne said something that was true?
July 13, 2013
The best joke from the government is:- we have cut borrowing.
July 13, 2013
I look through this rather long Osborne speech and could not find anything much that was actually true.
http://www.telegraph.co.uk/news/politics/spending-review/10143782/Spending-Review-2013-George-Osbornes-speech-in-full.html
July 13, 2013
You will pardon me if I do not hold my breath.
July 13, 2013
Sorry John but unless Osborne is reigned in, making statements like this, he is writing the equivalent to the 1983 Labour manifesto – a political and electoral suicide note…
I really don;’t think the Tories realise that first they need to keep the floating voters who swing like a pendulum between Labour and the Tories, without those voters the party could wipe the UKIP off the map and they still won’t get a (working) majority.
July 13, 2013
I can see why more of my posts fail moderation. My researched facts, trump your spin every time. OK, yes, to be expected as we get nearer the GE. You will be reprising the 2010 inherited deficit and debt argument, that would have been exactly the same if Labour had taken over from the Conservatives instead. (The same civil servants and casino bankers, would have been involved and the same financial crisis bail-outs would have been enacted).
Whomever runs the country, the debt and deficit level really do not matter that much to a sovereign fiat currency economy. The Treasury can wait a decade or two to get its money back,that the little people are currently holding on to for safety. If there is one number the 99% should take an interest in, but not fret about, it is DEBT divided by GDP. As long as the denominator, GDP, is going up faster than the numerator, DEBT, you are laughing.
Unfortunately, coalition Austerity is preventing GDP from “lifting off”, so Mr Carney is going to have to increase his DEBT, disproportionately, to compensate for Mr Osborne reducing his DEFICIT. Simples!
July 13, 2013
‘Keynesianism’ as defined by modern leftists is going up in a puff of smoke. People realize that in the end all govt spending must be paid for out of taxes, and that unlimited borrowing provides no solution, and may mean financial collapse as has happened in Greece. conservatives should keep the message simple. The budget needs to balance unless there are exceptional circumstances, and tax rates need to be as low as they can be to encourage work, enterprise and investment. Many academics, charities, journalists, broadcasters, leftist politicians and church leaders will protest, but the people as a whole will have the wisdom to ignore them.
July 13, 2013
@Richard1: “âKeynesianismâ as defined by modern leftists is going up in a puff of smoke.”
They have always known that, people are not THAT stupid, they also know that it was actually the private banks, credit providers and Mortgage provider that caused the current economic crisis, if anything âKeynesianâ thinking is having a renaissance, at least amongst the less dogmatic…
Oh and what do you not understand, the problems in Greece, their exacerbation due to inappropriate EU policies, have their roots in monetarism policies adopted by the EU for the Single Market, indeed a more Keynesian approach might actually help if the Greeks were left to their own devices (not possible whilst locked into the EZ).
July 14, 2013
The financial crisis was the result of a number of simultaneous factors: very loose monetary policy / excessive money supply growth finding its way into inflated banks’ balance sheets, which became excessively leveraged by historic standards. useless regulation which did not spot this. A huge build up of both private and public sector debt. Govt running deficits throughout the 2000s when it should have been running surpluses. That’s why the UK bust was worse than elsewhere and the UK was much worse placed than other countries which had run more sensible policies (Switzerland, Germany, Sweden eg).
Greece’s travails are not the result specifically of the Euro, but of 30 years of socialist-neo Keynesian spending. Albeit the Euro enabled them to carry on longer with that than would otherwise have been the case.
July 14, 2013
@Richard1: A patient can die of heart failure but the illness that caused the heart to fail might have been no where near the chest, my point is you are mixing up cause and effect, the root cause and what the effect was – the root cause being monetarist policies (and the very free market, which gave rise to the symptoms you mention. Oh and don’t be kidded into a fails sense of security, Switzerland, Germany, Sweden etc. are keeping their heads above the economic waves simply because they had far stronger economies to start with, not because they have not been flung into the “drink” along with every other world economy – even China and the other BRICS have been splashed…
July 14, 2013
Sorry, not sure if the mouse slipped but this is what I meant to quote from Richard1’s comment;
“People realize that in the end all govt spending must be paid for out of taxes
Sorry for any confusion caused!
July 13, 2013
Indeed Richard you are correct in all you say.
The problem is that these cuts would need to hit heavily at the top where Bazman correctly often says “socialism for the rich ” is deeply entrenched.
Keep the protection for the poorest and neediest in society but get rid of those who earn the six figure management salaries in quango land.
Socialism used to be defined as “power to the people” whereas today its about power to the new elite salariat classes.
July 14, 2013
There are 2 kinds of socialism for the rich going on: one is the quangocracy you mention, grossly over-remunerated public sector officials who in turn use their positions to argue for greater spending; the other is the continuing refusal to adopt a market solution to the zombie bank problem – with QE continuing to sustain banks and some businesses (and their highly paid employees) in the style to which they are accustomed.
July 13, 2013
Greece’s problems occurred because it couldn’t print money to pay off all its debts, something that won’t happen in the UK.
Unless the Conservatives have plans to cut spending by at least ÂŁ120 billion (annual deficit) they won’t be able to have a balanced budget.
Finally higher tax rates seem to encourage lower levels of unemployment, so there’s no reason to give the wealthy more tax breaks in the hope that they’ll create more jobs (something that has been proven not to work as reducing the 50% tax rate to 45% had almost no effect on unemployment levels).
July 14, 2013
@U5: Care to expand on your last paragraph, unless you mean that higher taxes simply allow more jobs to be invented by central government but were would this logic end, yes we would have full employment but then the state might be literally taking 100% of ones earnings and giving back -via tax credits or what ever- an allowance based on your [families] needs. Sounds a little like how the old USSR and GER etc. were run…
July 14, 2013
I note Uni that you have given up your previous argument about reducing the top rates of tax back towards the 40% they were for nearly all 13 years of the previous Labour Govt and now you are linking it to employment since lower rate has now been shown to increase tax revenues. Something you continually said on here would never happen.
July 14, 2013
Er except that since the reduction to 45 % unemployment has fallen month on month every month and the number of job vacancies have risen, oh and the SME sector created 500,000 new jobs
July 15, 2013
“Back in 2010, [Osborne] thought the private sector would create jobs because the economy would expand. […] If real GDP is 5.2% less than expected, how can Osborne still rejoice about job creation?
Simple. It’s because productivity has fallen [emphasis added].”
July 16, 2013
@libertarian: Err with ~3m unemployed [1] at the hight of the current crisis, a reduction of 45% (let’s round it up, call it 50%), that means 1.5m have come off JSA since 2010 yet SME’s created only 0.5m, even the big (multi-)nationals within the UK can’t account for the 1m left – my point, don’t assume that because unemployment figures fail that more people are employed, it might be that they are still economically inactive but simple not claiming benefits, worse still they might be turning to crime, or (even worse still) perhaps a few are even giving up the will to live – especially if they have a life-long disability that means that there is little hope of getting a job but are still expected to do so, on pains of having their only means of support withdrawn.
[1] which many believe was an under estimation
July 16, 2013
Jerry
It would really help if you could learn to follow a thread and read what people put. Uanime said that unemployment had not been helped by reduced taxes.
The 45% I referred to is the tax rate !!!! Since it was introduced ( ie reduced from 50% ) the month on month unemployment figures have fallen.
To prove what utter garbage you talk the number of people in full time employment has gone up.
Do try and at least pay attention. (etc ed)
July 17, 2013
@libertarian: But unemployment has fallen but the number of people in work has not risen by the same amount.
July 17, 2013
Jerry
There are 29.7 million people in work in the UK that is the highest number ever recorded. Sorry mate change tack to something you know about. Employment and job creation is my field and has been for more than 25 years.
There is a massive shift happening in the world from big to small. The vast majority of full time well paid job roles are with SME’s now.
July 17, 2013
@libertarian: It really is quite simply, the number of people leaving JSA related unemployment benefits does not equal the number of people who are entering jobs from being on JSA related benefits.
The total number of people employed in the UK is irrelevant but as we are still within the baby boomer generation’s working life and that their children and grandchildren are also of working age the figure you quote should be of no surprise, in other words nothing to write home about!
July 18, 2013
Oh for goodness sake Jerry.
We have 93% employment. Which despite the rise in population you think is nothing to write home about. Ha ha ha do you have any idea how ridiculous you sound?
So tell us the total number of working age ( ie non retiring) people leaving JSA who are neither working, in full time education or claiming benefits. Go on.
You really are clueless
July 14, 2013
“People realize that in the end all govt spending must be paid for out of taxes”. Richard, you couldn’t be any wronger if you tried. Please tell me where the money comes from to pay the tax? Answer: Taxes are paid with money the government spent previously. Government debt, Gilts and Treasury Bonds, are bought with money the government spent previously. The governments’s debt management office and the BoE, always have to make sure there is enough money in the system to buy the governments debt at the start of a DMO debt auction.
The government chooses to appear as a currency USER like the private sector. Currency USERS like commercial banks, firms and households have to balance their books. Assets must equal liabilities. The government ISSUES the currency, it does not have to balance it, just keystroke it into a USERs Stirling account and an equivalent amount into the USERs bank “reserve account” at the BoE.
Why do I think I am flogging a dead horse here?
Greece is in a monetary union, they use someone else’s currency they have no control of and can’t buy enough without a large positive current account balance which is where Germany wins at Greece’s expense. Greece can’t print it, so it has to borrow it from a market. The UK is sovereign in its own currency and can pay any bill presented in pounds Stirling.
” The budget needs to balance unless there are exceptional circumstances”. If the government balances its budget, who will pay for our negative current account balance (net imports)? It will be the private sector by running down its savings. All outstanding government debt is being “saved” by someone in the private sector including the zombie commercial banks. The latter having done a swap of a third of it for cash in their “excess reserves” accounts at the BoE.
July 15, 2013
” The UK is sovereign in its own currency and can pay any bill presented in pounds Stirling.”
As long as the bill is presented in Stirling, maybe. Except, the problem is that we import far too high a proportion of goods which need to be paid for in dollars, yen, euro etc.
Your recommendation that the UK government can simply print away it’s debts is of no help to us mere taxpayers, it devalues our stirling savings and increases the forward debt on us.
The only people who benefit from this are the government which collects taxes on sales and the financial services that collect levies on currency transfers and exchange.
July 14, 2013
Open-minded readers may like to read the opinions of a professor of economics at Oxford University.
http://mainlymacro.blogspot.co.uk/2013/06/the-intellectual-bankruptcy-of.html
July 13, 2013
JR you must of missed the bit where George Osborne promised NO RISE in VAT shortly before raising VAT to 20%.
Do you know what? I don’t trust him, I don’t believe him & I have seen no effort to cut wastage or reduce spending from this government.
July 13, 2013
And the ÂŁ1M IHT threshold promise not now even promised for next term. Not that Cameron has a cat in hell’s chance of winning without a UKIP deal. Even then they will struggle.
July 13, 2013
@libertarian: For once we are in agreement, although I suspect for totally different reasons!
July 13, 2013
Getting bored of saying it now – still no meaningful cuts in anything.
Mr. Redwood – why don’t you set yourself the challenge of identifying – in detail – how our local government can cut its costs.
Why not set yourself the target of moving the council tax charged back to what it was in the year 2000. Your government thinks it has done something fantastic by ‘freezing’ council tax – after it had DOUBLED under New Labour.
But, no, this would involve getting involved in detail. Looking at budgets, identifying what is necessary and what is a luxury – and getting rid of the luxury services etc. It would involve lowering pay scales and having a fight with the unions. It would involve decreasing pension entitlements.
Instead – I wonder what you actually do all day – apart from moderating this blog? Do you do anything actually constructive to serve the people who elected you? I don’t care a fig about your role as a member of the legislature – we already have plenty of laws and don’t need any more – I expect you to be the custodian of the money we, the people, pay to you, the government. I want you to expose and change bad practice in the way our money is spent. Not just make endless statements about what you think.
Reply I do have meetings with Ministers over how we can cut national public spending
July 13, 2013
JR: “George Osborne made a most important statement at the Treasury Committee on Thursday.”
Fine words butter no parsnips!
Wasn’t George going to do something quite specific to the deficit this Parliament, or have we forgotten all about that?
July 14, 2013
@APL: “Wasnât George going to do something quite specific to the deficit this Parliament”
Indeed he was but he decided to spend the money on giving millionaires a tax cut, without making it conditional upon them proving that they were actually investing in [new] businesses and jobs etc. – and then spend a fortune on a new railway line that no one actually needs, just so his Eaton school chums can look more green than the Green Party. Ho-hum… đ
Give me politics from the Skinner school of politics over this omni-shambles of a coalition (or should that be collision) government, the political direction might not be what is want but we do know to were we are heading!
July 15, 2013
Agree about the tax cut, it would have been better to cut the basic rate, VAT and/or remove stamp duty from shares. Maybe even remove the 10% levy on dividends. These would encourage consumer spending and investment rather than reduce the tax bill on those who are able to pay for tax avoiding investment and financial advice anyway.
As to HS2, granted this governmennt should shelve it but I thought this catatrophy was actually instigated during the last Labour government. There may be some political benefit to it but the main continuity will have been the civil servants rather than the politicians.
July 13, 2013
We have grow accustomed to statements from politicians about future policy being meaningless. That is why the country is being turned off by politics. That and it only being the rich and privileged that have any influence these days. And the fact that our chancellor has no qualifications or previous experience in economics. And the fact that our education secretary has no qualifications or previous experience in education. And the fact that our health secretary (allegation removed ed) knows nothing about medicine and has had a vote of no confidence from doctors.
July 13, 2013
I wish I could believe him !
So far he has done the opposite, he has raised taxes, and spent more than the last lot.
Are we going to get rid of fiscal drag as well, because if he does not, that is a tax rise.
July 13, 2013
Fiscal drag is indeed a huge tax rise.
July 13, 2013
Perhaps you can use your influence to ask Mr Osborne why IHT is 40% with a ÂŁ325K threshold but the SIPP fund of a deceased 75 years old pensioner is hit with a 55% penalty for dying?
Isn’t it true that although the General public are subjected to a set “Lifetime Allowance” all MP’s are exempt from such a levy? Is this fair?
These are 2 reasons why I hold no confidence in what the Chancellor declares. In fact, ditto for all the cabinet.
July 13, 2013
In all fairness if you had transferred your pension into an old style ASP after 75 (a concession to the Plymouth Brethren who objected to annuities as being a form of gambling and now removed) IHT was included and the penalty on death was well over 80% of the pension fund.
However looking at the universal derision here today, it looks as though “grand election strategist” Osborne has come up with another election losing idea. JR you know its time to get a rid of him
July 13, 2013
I suppose the 55% come from the assumption that they got 40% tax relief on pension contributions and would have to pay IHT had, they just invested the money personally.
Both taxes are wrong in principal and in their effect, no taxes at all should really be above about 20% they just become counterproductive. 20% vat, 20% income tax, 20%, NI, stamp duty, Corp Tax, plus duties etc. is more than enough for them to waste.
July 14, 2013
What about those of us who are not on the higher tax rate? For those on 20% tax rates or no tax at all, 40% IHT >ÂŁ325K is robbing their grave.
And 55% is just plain disgusting and reminiscent of the bad old days of Labour high taxation. All I want to know is why is it so high?
July 13, 2013
Dear John,
The statements I trust most are formal announcements at the time of the Budget. All else I take with a heavy pinch of salt.
“Needs must”, as they say, and tax rises might be needed throughout any given parliament, regardless of what was said by the Chancellor of the day, several years before.
Regards
July 13, 2013
So if petrol goes up in price will you cut the petrol tax rate or accept that it will be an increase in taxation.
July 14, 2013
@Pleb: No just petrol, tax is a percentage of earning or price, thus if your pay increases (and thus you pay more tax) are you going to also count that as a tax rise, what about high street prices, if they rise and thus the VAT take is higher are you going to count that as a tax rise?
July 13, 2013
Cuts in benefits can be seen as tax rises for the poor if there is no alternative ways to increase their income.
July 14, 2013
Bazman
Cuts in benefits can be seen as tax rises for the poor if there is no alternative ways to increase their income.”
Oooh does that mean if I don’t earn as much this year as I did last year that’s a tax rise too?
July 15, 2013
Yes. It does. Home Boy.
July 16, 2013
Wow Bazman
So by your logic if I drastically reduce my earnings this year the government will make loads of tax revenue from me.
Who knew it could be so easy to run the economy. As you say Bazman, Ram it.
July 17, 2013
If you did not cut your spending assumning you do not spend all your wages then you would pay more tax as VAT would remain the same and VAT is on just about everything. Yes it is don’t bother telling me it is not on food when we all know it is on many foods etc.
July 18, 2013
Bazman
I think you may want to rethink the logic of the statement you made.
In order to pay more VAT I would have to spend more money. Why would I do that when my earnings are severely reduced?
July 16, 2013
@libertarian: It might well do if you consider inflation as a form of taxation. Which in some ways it is, a means of reducing the deficit without actually increasing direct taxation to pay it off directly.
July 16, 2013
Jerry
I actually DO agree with you on that inflation caused by government debt is a form of tax rise
July 13, 2013
George Osborne’s trick is to downplay everything whether it be eating a posh burger because MacDonalds ran out of Lobster, tax rises, benefit cuts or the rise in food banks. The danger of playing to the gallery in any situation is you can only get away with it for so long as he and his party are about to find out. The posh yob lame double act of Boris and Gideon with Dave as the fall guy is wearing a bit thin and must be even in the Westminster bar…
July 13, 2013
Osborne’s original plan was 80% spending cuts, 20% tax rises; something that didn’t work because the economy didn’t grow as much as predicted, resulting in more borrowing. Now his plan is 0% tax rises and 100% spending cuts. Given his track record it’s likely to end in lower than predicted tax revenues and more borrowing.
July 14, 2013
I don’t think that a slower rate of spending growth is enough. It may be necessary to hold state spending constant in cash terms until the economy is back in balance again.
July 14, 2013
Mr Osborne promised in the last Parliament to increase the IHT threshold to ÂŁ1m.
It didn’t happen and reduced taxes won’t happen in the next Parliament.