The UK needs a larger and faster growing self employed and small business sector. I have long campaigned for the end of IR 35 which impedes winning new customers for the self employed. I have championed a higher VAT threshold to allow further expansion before needing to get involved in all the extra electronic paperwork to pay VAT on finished work and reclaim VAT on inputs.
Use of physical property is important for retailers and some service providers. Further cuts in Business rates and further rises in exempt smaller properties would b e helpful for those sectors. I do not favour replacing lost Business rates with a new turnover tax on on line activity. That just boosts prices and creates added business complexity. I have set out plenty of ways of the sate spending less to be able to reduce taxes modestly.
The entrepreneur does have some options to protect himself from excessive capital gains tax if he is successful. Wealth taxes do put people off coming to the UK to invest, or deter people from taking risks with their money if the government intends to take too big a share of their success. The capital gains tax threshold should be raised considerably from its current very low level. People are now reluctant to sell shares that may underperform or sell a spare holiday or secondĀ home they no longer need to avoid the tax. People do not exchange properties for ones that suit them better if there is a CGT liability. As the assets were bought out of taxed income in the first place there is a resentment about double taxation on those savings if a gain is recorded.
Setting up and growing a business is risky and hard work. It is a public spirited thing to do as the rest of us depend on people doing so to supply us with the goods and services we take for granted. A heavy handed taxman makes less attractive andĀ less worthwhile. The taxman says if you fail you fail alone. If you succeed I will be a partner in your success demanding a share of the profits.
July 27, 2024
Good morning
Successive governments have allowed themselves to be conned and seduced by a rapacious State eager for more funding. They have sought to close various legal tax loopholes with the latest narrative being that, tax avoidance schemes are akin to tax evasion. This has allowed through general ignorance of the two the government and the State to justify the taking of monies from those who save through various legal means.
A State that is not under the control of a government will always seek to grow. It does not care about those it is supposed to serve, just itself.
We are now past a tipping point where, even if you do get a government that wishes to control spending (ie the State) and grow the Private Sector, the Public Sector / State will seek to depose you. We have now witnessed what happens to governments that are ‘not on message’ and what they seek to do, not just here but elsewhere.
July 27, 2024
Liebour hates the self employed as did the last government. Constantly increasing the regulations and reducing the incentives for being in business
Reeves will further increase the tax burden on small business by aligning dividend tax with income tax.
Keith is busy signing away our sovereignty to Brussels including fishing, farming a FoM.
He’s a good recruiting sergeant for Reform.
July 27, 2024
Indeed almost nothing that Kier and Reeves are planning – other than relaxation of planning is pro growth. Further tax increases from the current hugely over taxed position, net zero, more employment laws, the war on Landlords, more nationalisation, abolition of Non Doms, VAT on school fees are all mad and indeed evil agenda that will do huge harm and strangle growth.
July 27, 2024
Milton Friedman : āI am in favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it’s possible.ā
The UK government (and most governments) are far too large, incompetents and intrusive already. They should never be spending more than circa 20% of GDP and should only be doing the rather few things that government can do better than business, charities, families etc. Law and Order, defence and a few other essential things. If they only spent 20% of GDP (and spent it wisely) then GDP would be far higher of course. – so it would be 20% of a much larger GDP.
July 27, 2024
I agree, LL – How to Ruin a Country seems to be the mantra!
July 27, 2024
So only 9% of person mileage is by train despite circa 100% tax payer subsidies and very large taxes on cars. Also only 16.1% of new UK cars sold do not have an IC engine – again despite subsidies and a vastly rigged tax market.
Customers are trying to tell the government something. Without government market rigging and propaganda lies, then if they paid the fair costs trains would cost more than double circa Ā£2 a mile so demand might fall to 2% of journeys and battery only cars might cost 50% more per mile or so demand might fall to perhaps 5% of new sales or so.
Free and fair competition and level playing fields please. What is the real and honest demand not the government rigged demand? Same for the NHS & Education between state and private provision.
July 27, 2024
Why do you think more building land in the building-land-bank is āpro-growthā? Nobody can afford to build the houses on the land that is currently available because they canāt sell them. Of course they can give them away, there is no lack of demand for free houses.
July 27, 2024
The only acceptable tax avoidance measure is to not take the income.
Everything else is rich man’s games
July 28, 2024
So why bother doing it if there is no more reward that being an employee. It wonāt be long before we have State run enterprises only and we all know where that leads, fourteen week waiting lists you can have it in two options only and it invariably breaks in the first month or you canāt access it because theyāre on strike, working to rule, only open 4 days per week or working from home and the phones are only answered by robots to put you on hold for 30 minutes.
July 27, 2024
We have the highest tax since ww2, but thats not enough, they want to tax even more, the Sheriff of Nottingham could learn a thing or two
July 27, 2024
Most politicians have no idea about the time, measured in years, to bring complex products to fruition or the risks involved. The UK’s hostile business environment has already caused the departure of several whole industries with more to follow. The increased taxes on capital gains, on “wealth” (hard won savings) now predicted from the new Labour government will be like more nails in the coffin marked “enterprise”. That is already obvious as investors exit markets while they can.
July 27, 2024
They even think they can rig the laws of physics re. electricity storage & renewables! No convinced God will adjust them myself, whatever mad laws the deluded Ed Miliband passes.
July 27, 2024
Yes SJ, doing all those things your government failed to do. They also made it very clear when undermining Liz Truss that they had no intention of doing anything such. They had their answer on 4th July. Now we have a government torn between dogma and survival. What is left of your useless government will now fight among themselves over leadership, no talk of refering to their remaining membership , so paganism to the pope will prevail and they will sink further into obscurity.
Those who would follow your solutions will increasingly fall in behind Reform, the only true Conservatives left fighting for a sovereign UK, it’s people and survival.
Reply I did not have a government. I spent 4 years disagreeing with the last government and decided I could not defend it in a General election!
July 27, 2024
reply to reply …but you didn’t act directly to confront them? The odd abstain could have been ‘against’ challenging sacking. You could have made it plain you wouldn’t fight Wokingham months ago, you could still establish dialogue with Reform ( are you?), aim to draw out the Conservatives who wrung hands a long time ago about the direction of travel.
Reply I made speeches, held meetings with Ministers voted against borders laws and Covid measures etc.
July 27, 2024
@ Reply – Known truths Sir John, likewise your report from āat the meetingā re. Cameron and Brexit, but nowadays the public psyche first needs to see a Netflix docu-drama with a movie icon saying your real life words to fully admit what happened.
July 27, 2024
JR is a Spartan. How can you say āthe odd abstentionā? You make a fool of yourself.
July 27, 2024
To reply:- it is indeed hard to defend the lies in four Tory manifestos that they not only failed to deliver but did not even try to deliver.
Betting odds on the US president suggest 60% chance of trump and 40% the rather dire Kamala Harris so a jump for her. The Tories should have replaced Sunak and held on until November. They would not surely have won by would have done better with a new face. Even one as dire as Kamala helps. What on earth made the unequivocally dire Sunak throw the towel in early?
July 27, 2024
Mel Stride becomes fourth Tory MP to enter leadership race joining James Cleverly, Tom Tugendhat and Robert Jenrick as a candidate to replace former prime minister Rishi Sunak.
So four totally dire, net zero pushing, green crap, pro EU, pro open door immigration, big state, Con-socialist continuation candidates & with at least 40 MPs of the 121 backing them. The party is determined to die it seems. It has learned nothing from the election.
July 28, 2024
I havenāt heard of Mel Stride and I thought I was a bit of a political bod.
Maybe the best thing if he has anything about him at least heās not carrying all the baggage and dirty briefing against weāre going to get with the others.
July 27, 2024
R to R
This is extreme nit picking. I credit you with disagreeing with the last government, no question. At the time they were in power the conservative party formed the government, you were a member of the conservative party. Ergo they were your government, my government and the whole populations government. They were there to represent the UK worldwide, even though you and many of the rest of us disagreed markedly with much they did. I do not hold you responsible for anything they did or did not do, because you have not been a member of government for many years. Like it or not, Starmer’s lot are now our government.
July 27, 2024
They were HM The Queenās Government, nobody elseās. If you donāt know just say nothing rather than spewing out a load quarrelsome nonsense.
July 27, 2024
There are a few ‘true Conservatives’ left in the Conservative parliamentary party but they have not yet mustered the sense or the numbers to nominate Suella Braverman for Leader even though she is the only one who could win the next General Election. She is the only one who realises the electorate must be given a very good offer (especially on tax cuts) at the next General Election as most people, including nearly half of those who voted Conservative in 2019 think the last government was a failure who they will still be very reluctant to vote for next time around. All the others believe in the overwhelming importance of 121 M.P.s more than the public at large and believe that just opposing Labour will be by far the most important thing – yet none of them will be even anywhere as good as William Hague was at just opposing Labour which turned into complete failure in the 2001 General Election (when the Conservatives weren’t seriously threatened by the Liberal Democrats and Reform unlike now). Electing any candidate other than Suella, any candidate who would not offer a radical, attractive alternative to Labour, will just result in the end of the Conservative Party as a meaningful political force.
July 27, 2024
I can only pass on my hairdresser’s comment from COVID when she and he partner in the business had to resort to using their savings to survive as the rules/regulations were so involved that it took too long to get any help. Small businesses are what the country needs to survive. For example, the supermarkets have successfully closed down the butchers, bread shops, small food shops and greengrocers mon the High Street by opening up at the start and end of towns with free parking thereby not encouraging people to go into towns. Now we see that what the supermarkets offered in a lot of cases have been withdrawn as they do not have competition from the High Street small business people eg TESCO has withdrawn fish and buy unpacked meats counters as there is no competition from outside. Morrisons is changing since it was bought from a family firm and not for the better. Capital gains tax is not understood by many until they buy a second home for holidays or letting from earned income and when they sell are taxed for using their money for self enjoyment and for others to enjoy. Better than taking holidays abroad and spending hard earned cash there I think so get rid of it.
July 27, 2024
Capital gains taxes without an indexation for inflation are hugely damaging, as are turnover taxes like stamp duty at up to 15%, as is the inability for landlords to deduct their interest from rents. These all tax āprofitsā that have not even been made. They are taxes at over 100% of profits or taxes when there are no profits and are hugely damaging & unsustainable.
July 27, 2024
It was Conservative chancellor, good old Ken Clarke, l think, who did away with indexation.
July 27, 2024
If I own half a home with my husband and then buy half a holiday home with him we are taxed an extra 3% stamp duty whereas if I buy one house and he buys one house we are not taxed extra. How is this fair? Yet again, the government treats couples unfairly.
July 27, 2024
Better still separate and both can be CGT tax free. Works for people on benefit too. A couple living apart can get the rents paid on both.
July 27, 2024
Christine you canāt each buy a house. The second one owned by the family is called the second home and is liable for CGT. You each have to register your main home as just that, and it has to be the same home.
July 28, 2024
I was just about to say that Lynn, I was told a married couple canāt own one property each, their assets are joint. This is why lots of people donāt marry, they get caught out at the moment when they die and can only pass on Ā£500k tax free, Ā£325k if its not passed to children.
July 27, 2024
Usually, when I make similar posts they are refuted by folk with great tales of improbable success.
BUT IMO you are absolutely SPOT ON! Small businesses gone!
Also with the shameful withdrawal of supermarket services. I have noticed that too.
And now different supermarkets stock different stuff ā¦so one is obliged to shop around.
Plus many small businesses have embraced the looniest of AI ( or is it digital?) whateverā¦ booking systems which mean that in the case of a last minute change of appointmentā¦you canāt get hold of each other. Mainly because the businesses do not answer their landlines! Who sold them this cr*p idea of customer service?
Where are the crowds once seen in the dentist and vet and hairdressers? In all cases I am usually the lone waiting room occupant!
July 27, 2024
There’s far more than controls and taxes in starting small businesses.Human emotions and a too high competitive instinct kills off many starters and indeed well established businesses.
I live in a lively trendy little village which has changed dramatically over the years from a local outback to a thriving small business community.
It looks as though everyone has ‘made it’ but the reality is that there have been more failures than successes.Again and again jealousy of competitors wipes out a new starter.
From a human perspective in business everyone is on their own and if success shines on the horizon you will be bled.
July 27, 2024
Any new startup has to be better than the current offering to compete successfully. There is no such thing as ājealousyā – itās competition. And the best wins. Successful startups are more likely killed off by the cost of employing, and then of course the bit VAT hit. You go from making a profit to making a loss for another 18 months or so until you build the turnover to a point of profit again.
July 27, 2024
I certainly agree, Tax changes and Tax simplification is required.
At the moment we have a tax system that is so complicated and far reaching, that many people now either require, or need to employ a tax expert or accountant, to simply try and keep themselves within the rules which are ever changing. Even after I retired I used to retain the services of my accountant of many years, to complete my tax returns, simply for peace of mind even though my tax affairs were very simple compared to many.
Now he has retired himself, I now face either requesting the help of someone new, or attempting to complete my own returns, with little help and advice from HMRC available.
The Fiscal drag on personal allowances now means I am liable for tax on my State Pension for the first time, the lowering of personal allowances also means I am now paying tax on my modest savings and investment returns, so the need to complete a tax form is now essential, not only for me, but for millions of other people as well, thus increasing the overheads, inefficiency and workload for both HMRC, and for individuals.
What we need above all is clarification, simplicity, fairness and understanding, not further complex changes with every Budget, which makes people think twice about working, investing, or saving in anything.
July 28, 2024
Alan, try to do it yourself, on the tax digital system, the form takes around 30 minutes I honestly believe that in five-ten years time everyone will be doing a tax return so all their income from cgt, dividends, savings and investments can be taxed at the same rates as income tax.
If you are married, and your wife isnāt using her full tax allowance she can share some of her tax allowance with you and you can get four years money back. You can fill in the form online https://www.gov.uk/married-couples-allowance/further-information
July 27, 2024
Now who’s asking for things which we know the Labour Government won’t do (any more than the Blue-Green Socialists would)?
July 27, 2024
But they said they wanted āgrowthā – so they are being hoist on their own petard. Too subtle for Reform and supporters, this game. You have to support them and then let them hang themselves.
July 28, 2024
Yes dear. You don’t recognise irony when you read it?
July 27, 2024
‘It is a public spirited thing to do’. Never a truer sentence was written but I would qualify John’s words by saying embracing capital risk is not a decision entered into for philanthropic reasons though the benefits to wider society can prove socially beneficial.
There would be no Tesco, Google or Microsoft without risk bearing, fearless and ambitious people
July 27, 2024
Unless and until, we have an adult debate on exactly what we want the state to do and provide for us, the amount of tax we will be paying will continue to increase.
I have thought for a while now, how similar the taxman is today, to the East End Gangsters of the 1960s. The state always want their cut or their piece of the action.
The other things that deter investment in our country are so called Windfall Tax, if the state thinks a business has made too much profit, and secondly, the relatively new phenomenon of fines, often imposed by regulators, which are all too often out of all proportions to the sin committed, and why do they always seem to be at a record level?
In my opinion, when you use the justice system as an extension to the tax system, you bring both systems in to disrepute.
July 27, 2024
Sir John,
May I recommend this article on The Conservative Woman website…
“Ardern has taught Starmer how to ruin a country.”
July 27, 2024
+1 A good article.
Dame Ardern was truly appalling and should be in jail in my opinion.
We now have to Suffer Starmer thanks to 14 years of Cameron, May, Boris and Sunakās Con-Socialist, net zero lunacy.
July 27, 2024
Cliff, Iāve read that article on TCW and there are rather too many similarities and parallels to whats going on here. The comments on that thread were blaming the WEF et al.
Big Brother Watch, Together, The Free Speech Union, and Iāve no doubt many other groups have worked hard to highlight, and stop, some of the more destructive pieces of legislation from going through, but because of the change of government, they were paused. Some of these, such as ensuring free speech in universities is not now going through, or the opposite will be legislated!
It certainly makes you wonder if itās deliberate. I personally think it is.
July 27, 2024
Ps by Sharon
Iāve just read that Toby Young of the Free Speech Union, intends to fight all the attacks on free speech, starting with Bridget Phillipsonās decision to block the clauses in the Higher Education Freedom of Speech act. The FSU are going to bring judicial review proceedings against the government.
In Great Britain, we shouldnāt even need to be talking about a threat to free speech, and yet, here we are!
July 27, 2024
+1, the left never like free speech as they are pushing such an unworkable & evil con trick!
July 27, 2024
Cliff
I think you will find that Alexander Johnson got there first on that.
July 27, 2024
+1 we will be paying for him for generations. A total disaster and with the best opportunity in a century.
July 27, 2024
Please note the leading comment!
July 27, 2024
The problem with SME’s is that we are a nation of knockers when it comes to entrepreneurs. Nothing enrages middle England more than someone who starts a successful small business and attempts to rise up out of their ranks.
For someone who didn’t go to the right school, or who doesn’t come from an old money background, it is next to impossible to raise venture capital to expand. All sorts of impediments suddenly become apparent if you try. Usually those who do succeed do so because at some point, they were able to bootstrap their business by re-investing profits – whilst drawing the minimum income necessary to survive. Twelve months later, the taxman is on their case.
The classic example is those entrepreneurs who start by selling their products on Ebay, or Facebook Marketplace. Once you have managed say, 1000 sales, inexplicably HMRC is banging on your door.
The taxman should chase after those who can afford to employ tax-dodging accountants, who make use of offshore accounts etc to hide their money. There are Ā£billions in evaded tax to recover
July 27, 2024
Plenty of legal ways to avoid taxes but they are often complex and distract you from running your businesses.
It is of course highly moral to legally reduce you taxes as you or your business will almost certainly spend or invest it far better than the government.
Many people are however reduced to benefit cheating, cash in hand, bartering, black market, crime, drugs dealing, stealing and similar given the absurdly high taxes we have in the UK. Or they just leave.
July 27, 2024
As there is so much of this cheating going on, it can often be rather hard for many legitimate tax paying businesses to compete and survive.
July 27, 2024
S G
The little people do not have the time or money to challenge HMRC who are fighting them using a bottomless pit of their own (and other taxpayers) money, and they know it.
Most just accept the decisions made by HMRC and roll over without much of a fight, no matter if the decision is right, or in many cases wrong.
July 27, 2024
Yes, what happened with the Panama Papers? That went very quiet. We only saw the perpetrators rewarded with seats in the House of Lords. This is the unfairness of the tax system where the burden is born by those not rich enough to avoid it.
Having just received my tax bill for next year, which I have to pay upfront on account, I booked an expensive holiday. I see no point in working hard and saving. Going forward I plan to have a better work/life balance. This is what happens when Governments tax people too highly. As the saying goes ‘Show me the incentive and I will show you the outcome’.
July 27, 2024
You have to pay for the holiday out of the already taxed income.
July 27, 2024
In one respect I do agree with you.
I think that ALL tax āloopsā should be open to ALL.
=no more taxes!
Oh and in the interests of equality ( shudder) supermarkets should be stripped of all competitive advantage.
July 27, 2024
I donāt know what line of work, if any, you are in but this is complete nonsense. The UK – for now – remains the most bouyant market in Europe for early stage fundraising. I have participated in or listened to many dozens of seed and venture fundraisings over a couple of decades or more. I have never heard anyone ask or be asked, or mention, which school they attended. I canāt imagine any circumstances or cases in which that information would have made the slightest difference.
July 27, 2024
All good (old) Tory stuff but as ever divorced from the day to day reality.
Go and work in or with hundreds of SMEs as I have.
Major topic of regular conversation, like almost every time. Employment Law and specifically Maternity Leave. (New) Tory law and now minimum, ever growing, wage,
Large businesses have the scale to manage it, SMEās keeping a job open, employing a temp, often to find the new mother dies not want to return to work, a nightmare.
Large orgs have an HR department, SMEs struggle often having to buy expensive consultancy advice. For ever the threat of tribunals with (questionable?) racism as a lever so getting rid a poor performers almost impossible.
Maybe this has changed but people who were in benefit had to show they were looking for work. So āpretendedā to apply, did not turnip etc. more time wasted and so it went on.
Where as divorced from reality politicians think all businesses aim to be unicorns, most donāt, a sustainable life style is the aim and politically imposed people cost, regulation etc a major barrier.
I am not suggesting a return to āhire and fireā but as happens so often when politically difficult or inconvenient, our masters operate a code of silence. Show me how many MPs come from an SME background and you will realise why despite the pompous virtue signalling how important the sector is, it is regularly let down so badly.
July 28, 2024
The biggest problem was job centres closing and going on line with one free job website which people only have to click through to show interest to get the benefits agency of their case, they have no intention of filling in the application form properly, and if you offer an interview they donāt phone to cancel it they just donāt turn up wasting hours of SME Management time. Sometimes if youāre close by theyāll turn up and give a dreadful interview.
July 27, 2024
I don’t think IR35 stops business winning customers. The more customers a business had the easier it is to prove the business is mot a worker or employee.
Companies and individuals should not be able to evade tax by claiming a trading relationship when in fact it is am employee / employer relationship.
IR35 should just require the contractor to be on a contract of not more than one year or have more than one customer
Reply It outs off customers as businesses could be held liable by HMRC for the self employed contractor
July 27, 2024
It should be a sufficient defense in a claim of being an employee not a sub-contractor, that the company can show the sub-contractor isn’t subject to its disciplinary procedure. Curiously this detail is omitted from the HMRC guidelines. I wonder if it could be challenged in court.
July 28, 2024
But they have to put right any errors at their own expense and a contract can be terminated if a gross error is made. The biggest check is that you can put a substitute worker in your place and the company has no say over that, how often you sub your work out and when.
July 27, 2024
Granted Sir John which is why my sugfested simplification of the rules may offer a solution to gaming the system and compliance
July 27, 2024
A major problem in the IT industry is programmers leaving one site and reappearing at another rebadged as contract Analyst/Programmers without having been through any additional training or indeed necessarily having the intellectual equipment required for analysis work thereby wreaking havoc on systems which otherwise would be stable and easy to maintain. Anything IR35 can do to constrain these people’s activities is beneficial.
July 27, 2024
Well said.
July 27, 2024
This simple idea of lowering tax on investment but increasing tax on profit makes no sense because investors look at the whole picture.
July 27, 2024
Does this labour government really want anybody to succeed in business?
Labour’s thirst for ever more ways to take away our money suggests that very soon it will be impossible to start up and run a new business.
Why are all the big high street shops closing at a fast rate? It’s not just because of internet shopping. I’d much rather browse a store than have to worry about sending items back. It’s because of greedy authorities.
The latest rumour is that the Chancellor will remove the option on pensions that allows the pot to be inherited. This will certainly not help investment going into start-ups, but shows how cruel labour ca be.
July 27, 2024
But why should pension assets be protected from IHT, when all the other products of saving are not? This is just one example of the complications and inconsistencies of our tax system. When will we get a Chancellor with sufficient interest in the brief to make the reforms that are so desperately needed?
July 27, 2024
Sir John
Some rebalancing is required with businesses generally.
We allow the UK to be up for sale to all predators, but that is only reasonable when reciprocity exists. For instance, we allow Foreign States and Foreign Businesses to gain control of UK Businesses when those same States would never, ever allow similar the other way around. There is nothing reasonable in that trade.
The largest beneficiary of sales of energy in the UK are the coffers of Foreign Governments ā the UK equivalents even if they can get going then have to pay their own and the missing contributions. Tax is supposed to facilitate the infrastructure for everyoneās benefit ā if one party gets a free pass another has to pick-up the short fall.
The other one that has appeared in to-days press is the acquiring of UK Companies by Foreign entities based solely on the loans they can obtain by hocking those businesses assets. They never invest directly themselves they just remove money back to their home country. All the purchase money is on loans based on assets of that UK Company ā they are not investing in that Company or the UK; they are only ever removing from the UK. Then when the inevitable the happens, the company is saddled with debt it canāt pay from its own income and the so-called investor gets to disappear. The Company that bought them? They are ahead they removed the wealth to more amenable locations than the UK. We are exporting our economy.
The UKās welcoming business strategy is purely about wealth removal from the UK. Our smaller SMEās etc. are in the end the ones paying for those imbalances, not the big operations homed in more favourable domains.
The real challenge is the reciprocity. Inward investment isnāt inward investment when a greater value escapes leaving those left – to pay someone elseās share. The only thing the UKās is exporting is its economy, its wealth.
So what tax change would need to happen when the income, the dividends head to more favourable tax domains?
July 27, 2024
There is no plan for any growth, let alone for the self employed and small business sector, other than for high, necessitating wasteful, state spending, increased state employment and control and population size.
The UN/WEFās policy is for DEI to apply throughout the world which means high immigration and de-growth, de-industrialisation and lower consumption and living standards for the West.
Net Zero, the āsolutionā to the false CAGW narrative, which even the IPCC Working Group 1 (āThe Scienceā) says does not exist, is designed to fail and cause a crisis in energy and food from which a new order is intended to emerge.
Red Edās decarbonisation by 2030 target, which can only be achieved through authoritarian rule and jettisoning security of supply for chaotic intermittency, is the modern equivalent of Stalinās agricultural collectivisation policy which didnāt work, was hugely unpopular and resulted in millions of deaths.
July 27, 2024
One tax change that would be helpful to small business is to eliminate employer’s national insurance. Why say on the one hand you want to encourage employment, then bleed the companies that do so? I can understand it in the public sector, when it’s just a way of clawing back the cost of government. At lease disapply it for certain industries, particularly manufacturing, to help them compete in the global marketplace. If there’s concern in retail, disapply it to the high street as well.
To my mind though, a bigger disincentive for small businesses to employ is the legal and financial hazard that comes with it. Get a couple of employees that mis-behave, and lo and behold you are landed with an employment tribunal, costing you time and treasure even if it has no basis. If that puts off people becoming employers, it should do.
July 27, 2024
Small retail shops can compete with Corporations on price ONLY if they do not need to add VAT to the sale. So remaining under the threshold is critical. However corporations also devise strategies to avoid charging VaT on sales, for instance big burger franchise outlets sell everything as a ātakeawayā in takeaway cups and delivered to you over the counter in a paper bag. You use their tables indoors āfree of chargeā.
There are financial incentives for small business owners to buy the shops they occupy. My tenants would buy but I canāt afford to sell, so the Government frustrates itself – unless the whole thing is just a virtue signalling exercise.
Nobody would mind paying CGT on real-gains, the problems is that the tax is more often than not charged on rest-terms losses.
When Sunak gave a āstamp duty holidayā the volume sold was massive, that is an indication of the pent up frustration in the housing market. Lots of people want to sell but canāt afford to. Thus there is nothing to buy if you do sell, especially in the north, so another reason why you donāt.
One thing we know for sure, the political class is incapable of learning. That makes them some of the most limited people in the country. We cannot have the most stupid people running our lives, businesses, wars and country any longer.
Time for a full-scale clear out. Every party association in constituency should be selecting new candidates in this Starmer interlude.
July 28, 2024
I have always said that Stamp Duty is naked theft. A private transaction between two parties in which the government, offering nothing in return, takes a cut.
It is truly disgusting.
July 27, 2024
When VAT was being first being considered it was heralded as asimple tax just p% onoutput minus inputs. What could be simpler. It dod not survive contact with the mandarins. It quickly became as complex as every other tax. Businesses need taxation to be simplified across the board. It is complex because the state is involved in every aspect of life and business. Wind back the state. It is the state as a whole that is holding back everyone in the UK. It is a burden to the majority who are net contributors, a threat to many and creates uncertainty making it a risk to business and to investors.
The market for state services and support is finely segmented, hence the complexity. But three incentives from taxation are genuinely needed:
1) encouragement of two-parent heterosexual marriage and families.
2) encouragement of enterprising businesses from the one-person business to SMEs and encouragement of British based multinational or international business – this would include investment in training of Brits rather than encouraging immigration.
3) R&D across the board, including climate change and Green Energy, in pre-competitive and, internationally, in early competitve phases, as allowed by WTO MFN rules.
These are the three essential uses of taxation, apart from raising government revenues to provide collective services for defence, etc. to encourage cohesive strong society, innovation, productivity and international competitiveness.
July 27, 2024
Today we read again where Badenoch, Cleverly, Patel and Braverman amongst others have notions about the Tory party leadership – question is who are the people who voted for these chancers? – do they come from some far distant region? Have we not had enough of trickle down, pie in the sky west african style economics? Jeez
July 28, 2024
I do not know about you, but two things :
1) They are all losers. Badenoch failed to get the Act that would have removed a lot of EU legislation. Patel, if memory serves, was sacked twice ! Braverman failed over Rwanda costing the country millions for nothing in return. And as for Cleverly ? I leave the dear reader to do their own research š
July 28, 2024
Oh, and 2)
Let us just say, they do not seem to represent the people they intend to serve š
July 27, 2024
Reply to Christines first submission.
Taxation as espoused in the 20,000 page tax book is unfair, very complex, contradictory, such that it supports an army of accountants and lawyers at great expense so that you can avoid its more pernicious elements.
Large corporations in retail and gambling choose sensibly to incorporate overseas. Others in highstreet coffee for instance inflate the costs of their imported inputs to the point that they make little profit and therefore pay little tax on it. They export their profit overseas before they make a cup of coffee.
A more intelligent tax regime would lead to an acceptable level of tax going to the exchequer. It is much the same with individuals. Retaining more money they have earned would lead to a higher spend on goods and services and a subsequent larger overall tax take. The result of grabbing tax before economic activity leads to a lower tax take overall due to lower economic activity.
I do not see this government, being any wiser than the last , so the prospect of a tax book rewrite are nil, more likely it will generate a few thousand more negative pages and ensure our continued decline.
July 28, 2024
+1
July 27, 2024
You’re fighting a losing battle with socialist governments, John.
July 27, 2024
Of course it is not only business owners who invest, it is also workers who are investing taxed income to build wealth, rather than just spending it all and then claiming benefits.
Where a disposal has taken place the norm is to re-invest the capital plus the dividends plus the profit in a different share. Where does HMRC think the money comes from to pay tax charges, while it is locked up in investment? It should be possible to roll tax payments forward to, say, a five-year period or complete disposal, whichever is the sooner. The demand for instant taxes on re-investment is equivalent to demanding homeowners pay tax on while their home is still accruing value but before it has been sold. But HMRC think only of pulling in annual tax on already double-taxed money (income tax, savings tax), and HMRC officials seem indifferent to the process of investment (perhaps because, as tax advisers have repeatedly mentioned, very few state-employed high earners ever invest at all – their salaries are untouched by the markets, as are their lavish future pensions).
It does not help that the CGT and allowance allowances have been slashed – after investors had already used the extended limits to invest more, and are now in an unavoidable tax trap.