Budget day

rick_chasey

Greg66 wrote:

One point Peston made on the BBC website last night was that many of those who expect to receive a massive bonus in 2012 can afford to let it be deferred to 2013 (thus negating the argument for deferring a cut in the 50p rate). I wonder if the Treasury will be looking at some anti-avoidance measures to pick that up.

I also wondered this: from 2013 there will be two upper rates: 40 and 45%. Quite close. Does Osborne have to set out more taxes on the wealthy to abolish the 45%, or does he combine both rates to (say) 42%?

I was under the impression the move to 45% is part of a longer term move back to 40%.

greg66_tri_v2.0

Rick Chasey wrote:

Greg66 wrote:

One point Peston made on the BBC website last night was that many of those who expect to receive a massive bonus in 2012 can afford to let it be deferred to 2013 (thus negating the argument for deferring a cut in the 50p rate). I wonder if the Treasury will be looking at some anti-avoidance measures to pick that up.

I also wondered this: from 2013 there will be two upper rates: 40 and 45%. Quite close. Does Osborne have to set out more taxes on the wealthy to abolish the 45%, or does he combine both rates to (say) 42%?

I was under the impression the move to 45% is part of a longer term move back to 40%.

I know that is the plan, at least publicly, but I can't believe someone in the Treasury hasn't looked at the alternatives.

For example, 50% @> 150k pulls in 1bn, 2bn less than expected. How much would replacing it with 42 vs 40% pull in? I would imagine that a huge swath of those paying 40% now would have very limited means of avoiding the additional 2%, so would that 2% across the board pull in more than 1bn?

The amalgamation of the two bands in this way could still be part of a short/medium term plan to get it back to 40%.

Possibly too politically poisonous, even if the numbers staked up though.

rick_chasey

Slapping 2% of more tax on earners from £37.4K+ won't ever fly.

You can get away with 50% on £150k+ since it is literally a single per-cent who are actually affected by it. (in terms of their pay-cheque anyway).

greg66_tri_v2.0

Rick Chasey wrote:

Slapping 2% of more tax on earners from £37.4K+ won't ever fly.

You can get away with 50% on £150k+ since it is literally a single per-cent who are actually affected by it. (in terms of their pay-cheque anyway).

What happened to "we're all in this together"?

greg66_tri_v2.0

See now, Rick, they all go on about how great Cake Stop is, but you try to have a proper discussion and they all sit there staring at their pencils, or picking their noses, or reading magazines under the desk.

Remind me: what's so great about this place?

Mccaria

Approx 3.75 million people are liable to pay tax at the 40% rate and circa 300,000 at 50%. As Rick says it is politically impossible to raise the tax rate by 2% for 3+ million to even things out.

rick_chasey

Greg66 wrote:

Rick Chasey wrote:

Slapping 2% of more tax on earners from £37.4K+ won't ever fly.

You can get away with 50% on £150k+ since it is literally a single per-cent who are actually affected by it. (in terms of their pay-cheque anyway).

What happened to "we're all in this together"?

You know my opinions on the matter.

I'm also not as myopic to economic arguments as you probably think .

If the 50p rate brought in as little as is claimed (and presumably those figures will be argued over in the next few weeks), then I can see the case for dropping it.

The 7% stamp duty for £2m+ seems a bone throne to the Lib Dems for swallowing the cut to 45%.

It seems a pretty ugly way of going about it.

Personally I was in favour of increasing the tiers of council tax above the highest rates currently available - I think that was floated by Conservatives and Lib Dems alike.

rick_chasey

Greg66 wrote:

See now, Rick, they all go on about how great Cake Stop is, but you try to have a proper discussion and they all sit there staring at their pencils, or picking their noses, or reading magazines under the desk.

Remind me: what's so great about this place?

Why you looking at me?

I'm a pro-race guy at heart .

Pross

Greg66 wrote:

See now, Rick, they all go on about how great Cake Stop is, but you try to have a proper discussion and they all sit there staring at their pencils, or picking their noses, or reading magazines under the desk.

Remind me: what's so great about this place?

Sorry, I was in the loo "having thoughts" of a certain commuting lady

Increasing the 40% tax rate at the current level it starts at would be political suicide, I suspect a lot of Tory and Lib Dem core voters earn at around that £40k rate. The threshold doesn't seem to have risen in line with earnings over the years so there are a lot of higher rate tax payers out there.

greg66_tri_v2.0

Rick Chasey wrote:

Why you looking at me?

It's a dialogue. There's no one else to look at. That's the point.

rick_chasey

Greg66 wrote:

Rick Chasey wrote:

Why you looking at me?

It's a dialogue. There's no one else to look at. That's the point.

http://en.wikipedia.org/wiki/Rhetorical_device



Some people are already picking apart the 50p drop argument.

greg66_tri_v2.0

Pross wrote:

Increasing the 40% tax rate at the current level it starts at would be political suicide, I suspect a lot of Tory and Lib Dem core voters earn at around that £40k rate. The threshold doesn't seem to have risen in line with earnings over the years so there are a lot of higher rate tax payers out there.

I don't disagree that it would be political suicide. I sort of struggle though to see why: 2% isn't really that big a deal, is it? The 40% rate kicks in a 35k at the moment. Say you earn 50k - a 2% increase would be 2% extra on 15k = £300. Per year.

By contrast, the step will drop for 2012-2013 from 35,001 to 34,371. So £630 will be taxed at 40% rather than 20%, ie an extra £126. So less, but not a great deal less.

But it's headlines that count, and the perception of what's being done that matters, rather than the detail and what is actually being done.

rick_chasey

Greg66 wrote:

But it's headlines that count, and the perception of what's being done that matters, rather than the detail and what is actually being done.

Depends what perspective you take.

Electorally, sure.

rick_chasey

Who gets hit hardest?



Richest, followed by poorest.

greg66_tri_v2.0

Rick Chasey wrote:

Who gets hit hardest?



Richest, followed by poorest.

So it is that great swathe of 40% taxpayers in the middle who aren't paying their fair share.

"What do we want?"
"A 42% income tax rate for honest hard working families!"
"When do we want it?"
"The commencement of the 2013 fiscal year at the very latest!".

Not that catchy, really.

beverick

Greg66 wrote:

Listening to him explain at length how the 50p rate didn't pull in as much as predicted, and how it was damaging for Britain, it was a bit odd then to hear the finale: we're keeping it for another year before the 45p rate comes in.

If you look at historical stats, everytime a top rate of tax much over 40% has been introduced the tax take has increased in the short term before dropping away as the accountants work out a way around the new rate for their masters.

Also, the change will take place from 2013 basically because it's too late to implement it for the 2012/13 financial year without putting 'R' side of HMRC into meltdown.

Overall it's a fairly neutral 'wait and see' budget you'd expect at this stage of a parliament with the economy showing signs of recovery (certainly against most of the rest of Europe).

It's also nice to be well away from the 'smoke and mirrors' budgets of Brown and Darling where changes were announced to take place at some arbitrary and' soon to be forgotten' time in the future meaning that you suddenly noticed you were substantially worse off without even knowing it was going to happen.

Bob

JamesB

Around £400m the treasury says. Presumably that's contestable, but still

Yes, very contestable; can`t remember (C4 ?) but last day or so investigation into how suddenley dividends payment dates had shifted in 2011 to 1 April, ie pre 50% tax, from normally 6th April , and in 2012 to 10 th April, ie post expected drop to 45%.

Summary was treasury haven`t a clue about how much tax the 50 p rate brought in as some much alterations on these payment dates. So above difference is IMO fiction

TheStone

JamesB wrote:

Summary was treasury haven`t a clue about how much tax the 50 p rate brought in as some much alterations on these payment dates. So above difference is IMO fiction

The older I get, the more I think none of them have a clue about anything.

In my mind, we pay way too much tax and the state if far too large.
The real rates are much higher. NI and ENI is just hidden income tax.
41.3% (20% band)
50.0% (40% band)
67.2% (>100k loss of allowance)
58.6% (50% band)

This brings the top rate down to 54.3%

MaxwellBygraves

Hmm. Appears anger may be brewing over the so called 'Granny tax'. Very interesting. Potential for a Tory core vote backlash here. Considering that the older generation are both the most likely to turn out on election day and most likely to vote Conservatively, potential to be a big deal.

Here's the Gransnet (I didn't know it existed either) response: http://www.gransnet.com/being-a-gran/le ... granny-tax

Crapaud

MaxwellBygraves

Quite.

MaxwellBygraves

Good news is that the budget appears to have failed 'Tabloid test'.

Mail, Mirror, Sun & Torygraph all ripping budget to shreds in tomorrows papers.

rick_chasey

On reflection, what's disappointing about it is that it skated over the things that seem to matter.

The massively poor growth and employment figures were skated over very quickly in the beginning.

I was trying to remember a policy he'd said that was actually going to affect either growth or unemployment in a meaningful and significant way.

I can't think of anything that fits that category.

rjsterry

This all very weird. Commuting Chat used to be THE home of political bickering. Is this the start of a takeover.

Anyway, there now seems to be a desperate scrabble to kill off the 'Granny Tax' meme before it gets established as 'fact'.

rick_chasey

rjsterry wrote:

This all very weird. Commuting Chat used to be THE home of political bickering. Is this the start of a takeover.

Anyway, there now seems to be a desperate scrabble to kill off the 'Granny Tax' meme before it gets established as 'fact'.

Yeah.

Seems politically mad.

My boss made an interesting point. Between the obscenities he gave the generation argument - pensioners have had it good the whole of their lives - about time they shared some of the burden - especially since the tax allowance has gone up.

bearfraser

As usual we are all Fcuk'd ,Fuel - up, ciggies, booze , pie's ,Etc. Etc. UP UP UP . The only ones who are getting richer are the Tory millionaires unless they are "Grannies". How long before another summer of discontent ???????????????
Did you all notice that the idea of paying public workers according to where they work didnt seem to make it into the budget , that really is going to upset many people.Myself included. :evil: :evil:

ddraver

Greg66 wrote:

See now, Rick, they all go on about how great Cake Stop is, but you try to have a proper discussion and they all sit there staring at their pencils, or picking their noses, or reading magazines under the desk.

Remind me: what's so great about this place?

Well i live in the Netherlands (that's a place outside London), so none of it bothers me much! I'm aware I pay way more Tax than the UK anyway so tiny changes don't interest me. On the plus side though, that tax does seem to be used for some useful thing over here.

When i come back I might start paying attention, but sometimes I wonder why I might....

RideOnTime

pliptrot wrote:

I am amazed and appalled by commentators who continue to tow the line that we need bankers because of their "contribution to society.". Their tax contribution is woefully inadequate, as well.

agreed

Frank the tank

ddraver wrote:

Greg66 wrote:

See now, Rick, they all go on about how great Cake Stop is, but you try to have a proper discussion and they all sit there staring at their pencils, or picking their noses, or reading magazines under the desk.

Remind me: what's so great about this place?

Well i live in the Netherlands (that's a place outside London), so none of it bothers me much! I'm aware I pay way more Tax than the UK anyway so tiny changes don't interest me. On the plus side though, that tax does seem to be used for some useful thing over here.

When i come back I might start paying attention, but sometimes I wonder why I might....

Stay where you are pal.

daviesee

bearfraser wrote:

As usual we are all Fcuk'd ,Fuel - up, ciggies, booze , pie's ,Etc. Etc. UP UP UP . The only ones who are getting richer are the Tory millionaires unless they are "Grannies". How long before another summer of discontent ???????????????
Did you all notice that the idea of paying public workers according to where they work didnt seem to make it into the budget , that really is going to upset many people.Myself in particular. :evil: :evil:

Fixed that for you. How much of your comment is actually true?
Ciggies and Grannies. That's about it.