.. the first casualty of politics is the truth

[MrGongGong]

To be fair, it would be described as a reduction of 50%, which it is... while an increase from 1 to 2 would be an increase of 100%.

Of course (sorry)

Should we insist that politicians all learn Supercollider before making pronouncements?

[P. G. Tipps]

To be fair, it would be described as a reduction of 50%, which it is... while an increase from 1 to 2 would be an increase of 100%.

Quite ... and as every stinking, rotten, share-buying capitalist knows to his/her cost that, when their "portfolio" is reduced in value by 50%, it takes rather more than a 50% increase again to return it to its original value!

[P. G. Tipps]

PGT

what matters to a person is how much tax they pay in total.

Whether it is income tax, VAT, council tax or whatever is a matter of detail , really.

The rich ENDLESSLY whinge ON and On and On and on about their tax bills the poor spoilt darlings, but in they end they pay less in percentage terms than the very poorest in society.

its a truly disgraceful situation.

and income tax /National insurance is part of the problem..

Kids earning 20k PA with student debt, (without which they wouldn't earn such princely sums) pay effective marginal rates of 40%.

So much for the much lauded incentives that the rich bang on about in their attempts to reduce tax rates.

Socialism for the rich, capitalism for the poor.

Give me strength.

Teamsaint, I'm not saying the current tax system is perfect, far from it. I was merely pointing out that direct tax on income and all taxes (direct and indirect) in relation to income are two quite different things.

Indirect taxes are indeed 'regressive' but if the Government were to rely solely on Income Tax to raise money the rates would be enormously high and it would be the 'poorest' who would suffer the most as they would end up starting with even less money on which to survive?

How to devise a truly 'progressive' form of indirect taxation has baffled the best brains and, sadly, I doubt any budding economic genius will ever come up with one.

Reducing (eliminating in some cases) Income Tax for the 'poorest' is the best way to help them, imv. I'd also be in favour of increasing it to 50% for the very rich if that were to increase total amount received by the Treasury, but there is a clear difference of 'expert' opinion on that, and it would seem utterly pointless if it didn't?

[ahinton]

PGT

what matters to a person is how much tax they pay in total.

Whether it is income tax, VAT, council tax or whatever is a matter of detail , really.

The rich ENDLESSLY whinge ON and On and On and on about their tax bills the poor spoilt darlings, but in they end they pay less in percentage terms than the very poorest in society.

its a truly disgraceful situation.

and income tax /National insurance is part of the problem..

Kids earning 20k PA with student debt, (without which they wouldn't earn such princely sums) pay effective marginal rates of 40%.

So much for the much lauded incentives that the rich bang on about in their attempts to reduce tax rates.

Socialism for the rich, capitalism for the poor.

Give me strength.

Whilst you are, broadly speaking, correct in suggeting that those whose earned incomes take them not far above the 20% income tax threshold are likely to pay more taxes in percentage terms than those on much higher incomes, you say that "income tax/National Insurance is part of the problem", I think that the greatest culprit here is VAT and other taxes on spending, in that almost everyone - even those on incomes low enough to attract no other tax liability at all - will have to spend something at some time or another and some of that spending will include VAT, insurance premium tax, domestic fuel tax and the like; this is as responsible as anything (or perhaps more so) for the situation in which the poorest pay the higest percentages. I accept that the quaintly termed "National Insurance Contributions" - which are, of course, one of the taxes - are perhaps the next worst culprit here, in that NIC1 is levied on earned incomes above £7,956 p.a., NIC4 is charged on taxable profits in excess of the same figure and NIC2 kicks in even lower, on taxable profits above £5,885 p.a.; all of these starting figures for liability are way below that of the personal income tax allowance of £10,000 p.a. for taxpayers up to age 66 and a little more for those above that age.

I sometimes wonder if it might be a good idea to scrap corporation tax and employers' NIC tax altogether provided that all monies thereby saved by employers must be invested in providing more employment (rather than paid to shareholders), with all employers found to be in default of this being heavily fined; more employees means more productivity and more income tax revenues for HM Treasury from more taxpaying employees and the likelihood of such an arrangement attracting foreign investors might be sufficiently great to raise substantially more revenue again. OK, I'm not at all dogmatic about this because I have no certainty as to whether it could be made to work effectively at all, but it's a thought nonetheless.

As to the Osborne new SDLT arrangements, I cannot see any of these being of much use. According to https://www.gov.uk/government/upload...dance-note.pdf the new rates are:

Purchase price of property Rate paid on part of price within each band
Up to £125,000 0%
Over £125,000 and up to £250,000 2%
Over £250,000 and up to £925,000 5%
Over £925,00 and up to £1,500,000 10%
Over £1,500,000 12%

The old rates were

Purchase price of property Rate paid on part of price within each band
Up to £125,000 0%
Over £125,000 and up to £250,000 1%
Over £250,000 and up to £500,000 3%
Over £500,00 and up to £1,000,000 4%
Over £1,000,000 and up to £2,000,000 5%
Over £2,000,000 7%

Whilst the new arrangements are undoubtedly fairer by reason of the tax being graduated rather than applied to the entire purchase price, the only beneficiaries would be those wanting to purchase homes priced in the lower bands and, as those benefits are almost certain to give rise to inflation in that sector of the market, homebuyers will likely find themselves no better of and possibly worse off because any tax benefit will be offset (and possibly more) by a higher purchase price. As to the upper end, all that this will likely achieve is discourage sales of top end properties and, after all, SDLT is generated on these only when they're sold (and I daresay other avoidance or mitigation arrangements have already been thought up for those who really need to sell); there would likely also be a squeeze on prices at the top end with the result that less SDLT than anticipated might be generated on sales for lower prices. Whlst the one possible good thing about this might be a narrowing of the gap between the lower and the higher priced homes, it's hard to see who's likely to benefit from this and it will certainly not help those at or near the bottom end if those properties increase in value in line with the tax reductions.

So I don't quite buy your "socialism for the rich, capitalism for the poor" argument.

[Richard Barrett]

Should we insist that politicians all learn Supercollider before making pronouncements?

I don't know about that, I don't think I'd much like to hear the results.

Oh-oh, another tax thread. (eyeroll)

[aka Calum Da Jazbo]

http://www.theguardian.com/politics/2014/dec/04/osborne-accuses-bbc-hyperbolic-coverage-spending-cuts

this thread is not about tax it is about the difficulties of establishing an even proximal indication of truth in our public discourse .... one way to avoid the truth is to hijack the topic at hand with red herrings [blue fish if that is your bag]

i have no affiliation at present and certainly regard all the main political players as having a strong aversion to knowing and telling the truth ... they certainly do not want to know the truth about the impact of their decisions and actions in office 'the department is fully committed to spending/saving/improving &c '

the single most devastating avoidance of truth is the Home Office and May's personal equivocations about 'disincentives' for refugees in the Mediterranean Sea ... when what they mean is if enough drown with no rescue maybe the rest will pause before attempting the crossing ... we have not heard such mendacity since McNamara was in the Pentagon and Skinnerian Rewards Schedules [napalm] were being applied to the indigenous population ...

[ahinton]

I don't know about that, I don't think I'd much like to hear the results.

Oh-oh, another tax thread. (eyeroll)

Not necessarily, but coming in the immediate aftermath of the Chancer's "Autumn" (does he operate from a tax haven with a climate different to that which pertains aroun No. 11?) statement it was perhaps inevitable that some of the contents of said statement might find their way into the discussion.

That said, it seems to me that the very thread topic itself is both self-explanatory and pretty much beyond argument in most instances.

[teamsaint]

Out of courtesy to Jazzer, I'll keep any specific comments about tax for another thread.
My point was really that there is a kind of built in institutional lie about tax, and its effects on various income levels, and that lie is ruthlessly exploited by those with wealth and high incomes.

As regards my" Socialism for the rich, capitalism for the poor", comment, ( not my idea)that is part of a broader discussion .

[ahinton]

Out of courtesy to Jazzer, I'll keep any specific comments about tax for another thread.
My point was really that there is a kind of built in institutional lie about tax, and its effects on various income levels, and that lie is ruthlessly exploited by those with wealth and high incomes.

I'm sure that you're right about that although I suspect that the ruthless exploitation of that and other institutional lies is by no means the sole province of the wealthy and those on high incomes!

[Eine Alpensinfonie]

I'm sure George Osborne was trembling in his shoes on Breakfast TV this morning, when faced with such difficult questions from Steph McGovern.

(PS, she hardly challenged him at all.)

[aka Calum Da Jazbo]

http://www.ifs.org.uk/uploads/publications/budgets/as2014/as2014_johnson.pdf

the IFS take on the Autumn Statement

and the Graun in full imperial flow:

The OBR’s tables state that, under current plans, the day-to-day funding for all services beyond the NHS and state schools will now have to fall from £3,020 per head at the end of the last Labour government, to £1,290 by the decade’s end. That is a real-terms decline of more than half, the bulk of which is still in prospect, for policing, justice, local government, culture and everything else besides.

http://www.theguardian.com/commentisfree/2014/dec/03/guardian-view-george-osborne-statement-cannot-be-serious

[P. G. Tipps]

I can't see how the Autumn Statement has any more relevance to the supposed subject of this thread than tax?

However now that it has been mentioned by the OP himself I think the prominent economist Anatole Kaletsky summed things up pretty well on TV today.

He claims that if the Government had succeeded in eliminating the deficit by the end of this parliament the higher growth we now see would not have happened. My thoughts as well though I'm certainly no economist ...

I do think it's a bit rich that some of those who were recently banging on about 'austerity' measures to reduce the deficit, because they claimed it would adversely affect growth, are instead now complaining about the lack of progress on reducing the deficit which has almost certainly contributed to the higher growth!

Illogical and absurd, imv, and I'm not aligned to any political party either!

[Serial_Apologist]

I'm sure that you're right about that although I suspect that the ruthless exploitation of that and other institutional lies is by no means the sole province of the wealthy and those on high incomes!

But surely the point is not worth making, given the disproportionality of the wealthy's impact through tax avoidance etc by virtue of the vastly larger quantitities of unpaid tax involved.

This should always be reminded whenever the "we're all as bad as them and therefore equally to blame" routine gets trotted out.

Maybe the rich should set an example - after all it is they or their friends who caused what we're all now paying for.

Fat chance of that, of course.

[MrGongGong]

Maybe the rich should set an example - after all it is they or their friends who caused what we're all now paying for.

Fat chance of that, of course.

I think there is a bit of a "backlash" going on
with folks ranting on about a "tax on aspiration" and other such nonsense
and others getting a bit steamed up about how unfair it is for them to give away some of the money they have made simply by buying a shed in Dalston in the 1950s which they sell for millions.
If we will have politics that only appeal to self interest :-(

[Serial_Apologist]

I can't see how the Autumn Statement has any more relevance to the supposed subject of this thread than tax?

I do think it's a bit rich that some of those who were recently banging on about 'austerity' measures to reduce the deficit, because they claimed it would adversely affect growth, are instead now complaining about the lack of progress on reducing the deficit which has almost certainly contributed to the higher growth!

Illogical and absurd, imv, and I'm not aligned to any political party either!

It's only the Left, not Balls et al, who forewarned that the coalition would claim successful recovery having reduced Britain to a low-wage economy. Now the consequences are having to be admitted in low tax returns.

It was all so much simpler when all that capital was interested in was screwing as much surplus value as they could gain out of the working class, and trade unions could argue deservement of a larger slice of profits; when the establishment unleashed consumerism, being still dependent on the state support their newspapers feigned to abhor, they didn't account for the inherent instability of their economic system later rather than sooner catching up with the never-never, and that part, the buying capacity of the working class being key to the political legitimacy of a system based on environmental unsustainability and continuing inequality, becoming such a key determinant in economic fortunes. That calculation had never originally been part of the equation.