LEAVE the Conservative Party and save your country!
Comments
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For Sweden.Stevo_666 said:
That supports my point quite well, thanks.kingstongraham said:
It says this: "Unlike in Britain, Sweden offered no inheritance tax relief for family-owned businesses. This was disastrous for Swedish enterprise, where around nine in 10 companies were owned by people related to each other in 2004. "Stevo_666 said:
I've shown you my evidence. I think the onus is now on you to show some evidence that the article is wrong.kingstongraham said:
Could be something to do with most of them having inheritance tax or property tax.Stevo_666 said:
So why are you pushing the point?kingstongraham said:
You were the one who brought Sweden into this irrelevant discussion.Stevo_666 said:
Why not do both? Would attract more of the wealthy back (as the IHT abolition did) where they can pay taxes on everything else. Worked once.kingstongraham said:
You don't think it's possible the presence of CGT on the main residence (which is more difficult to avoid) makes it more straightforward to abolish inheritance tax?Stevo_666 said:
Taxation of main residences is pretty uncommon even in the normally tax hungry EU. Which should tell you how poor an idea it is. The Swedes don't get everything right.kingstongraham said:
Tell me about Sweden's capital gains tax on sales of property.Stevo_666 said:
See above. It is likely to be counter productive, like your misplaced wealth tax ideas.rick_chasey said:
Why would it be tax on moving, if when you die it's set at the same rate? It would just be a tax on capital gains, regardless.First.Aspect said:
If you whack 40% gct on primary residence, this will be more or less 40% tax on moving house for a lot of people, and make downsizing quite hard to do, unless downsizing a lot.TheBigBean said:
The tax wouldn't be avoided by death, so wouldn't be part of the estate. Therefore not moving only delays the payment.Stevo_666 said:
I reckon you're right about the last bitTheBigBean said:
All circumstances, good question and sounds reasonable. I'd probably go with the retroactive option and bring it in with immediate effect to avoid chaos.Stevo_666 said:
Setting aside the probability of this ever happening for a moment:-TheBigBean said:
I like the idea of removing CGT relief on main residences.Jezyboy said:
Banks will lend more money to higher earners. Not that shocking is it?rick_chasey said:
I like the idea of CGT for assistance swap though.
- Is this in exchange for mortgage relief, or do you just want to remove the exemption regardless?
- Would this be effective from when implemented (i.e only gains after the implementation date are taxable), or would this be retroactive to whenever the property was bought?
- And if a gain is taxable, does a loss on sale of a main residence create a tax loss that can be used against future gains? (i.e. the normal rule for CGT).
I would generously allow roll over relief though.
I won't be elected.
The problem I can see is that all these lone pensioners in big houses will probably never sell up if they are going to get a massive tax bill, which kind of puts a spanner in Rick's plan to let young families get their hands on these properties for the greater good.
All that will do is choke supply in the middle and upper ends of the market and raise prices.
Discuss.
A quick reminder of the real life experience of Sweden when it abolished IHT and increased the tax take:
https://telegraph.co.uk/tax/news/sweden-ditched-inheritance-tax-business-boom/
So if you want to increase the overall, tax take, what would you do?
And after a bit more research, Sweden is the outlier in terms of taxing main residence sales in Europe (Spain and Portugal do but allow relief for reinvestment in another property). If it was such a good idea, why do you think other countries haven't done it?
Although I see you can't answer my question.
You've chosen one tax in one country because the Telegraph highlighted it.
I'm not sure how they have directly related the increase in overall tax revenue to removing this tax. Any detail on that? I'm sure it wasn't the only thing they've done.
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Sure. Is it possible you have a chip on your shoulder about anyone older than you though?rick_chasey said:It is 100% annoying me that according to the govt, state workers asking for pay rises is bad, but pensioners getting a 10% state pay rise is good.
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Genuinely, when it comes to stuff like macro economic policy, it shouldn't really matter if you're old or young.First.Aspect said:
Sure. Is it possible you have a chip on your shoulder about anyone older than you though?rick_chasey said:It is 100% annoying me that according to the govt, state workers asking for pay rises is bad, but pensioners getting a 10% state pay rise is good.
If it's inappropriate to give state workers 10% pay rises, why is it appropriate to give state pensioners a 10% pay rise?
What's the logic.
If it's a moral logic, then pray tell the logic the gov't has had behind cutting all other benefits bar state pension over and over again?0 -
Noting that the public sector pay policy and the "triple lock" aren't my policies, so I'm not defending them, the logic could be as follows:rick_chasey said:If it's inappropriate to give state workers 10% pay rises, why is it appropriate to give state pensioners a 10% pay rise?
What's the logic.
- Honouring the "triple lock" is official policy, so whilst it's not enforceable as such, it's clearly a reasonable expectation in normal times. It wasn't honoured recently, as the post-Covid impact on pay rises made the average earnings component artificially high.
- Conversely, the commitments given re public sector pay are much weaker.
- Pensioners can't find another state pension provider if they don't like the current one. So the state has a moral obligation to provide a "decent" state pension.
- Conversely, those in work can find alternative employers, should they so choose. (And lots of NHS doctors are doing this by emigrating apparently, which might force the government's hand re pay in future. Albeit the next government rather than this one.)
- And those in work have the opportunity to secure pay rises via promotion etc. which obviously isn't the case for pensioners.
FWIW, the much-maligned Huw Pill probably had it right conceptually when he said that we all needed to get used to being poorer. In the face of inflation caused by surging commodity prices, there is no automatic mechanism by which UK pay levels should be expected to adjust to compensate. Tightness in the labour markets has given a lot of negotiating power to private sector employees with sought-after skills, which has driven high pay growth in certain areas.
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So you think it's just bargaining? I'm a little sceptical about the lack of pensioner bargaining power, as whatever they're collectively doing they've had a slew of policies that go directly in their favour (including, above all, the triple lock!).
If you cannot give already underpaid workers an inflation matching payrise, *for work they are actually doing*, I don't think you can follow up with a much more expensive pay rise to pensioners.
So if you want to give the pensioners a 10% pay rise, it stands to reason, for the same reasons, you ought to give the state workers the pay rise.
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I don't disagree.rick_chasey said:
Genuinely, when it comes to stuff like macro economic policy, it shouldn't really matter if you're old or young.First.Aspect said:
Sure. Is it possible you have a chip on your shoulder about anyone older than you though?rick_chasey said:It is 100% annoying me that according to the govt, state workers asking for pay rises is bad, but pensioners getting a 10% state pay rise is good.
If it's inappropriate to give state workers 10% pay rises, why is it appropriate to give state pensioners a 10% pay rise?
What's the logic.
If it's a moral logic, then pray tell the logic the gov't has had behind cutting all other benefits bar state pension over and over again?
But you weren't askance when the minimum wage went up 10%.
Appreciate there are rather more state pensioners, but less clear whether the knock on effect in the labour market would have been bigger or smaller.
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TBH it's more an argument that the workers should also get the pay rise, rather than cutting the pensioners.First.Aspect said:
I don't disagree.rick_chasey said:
Genuinely, when it comes to stuff like macro economic policy, it shouldn't really matter if you're old or young.First.Aspect said:
Sure. Is it possible you have a chip on your shoulder about anyone older than you though?rick_chasey said:It is 100% annoying me that according to the govt, state workers asking for pay rises is bad, but pensioners getting a 10% state pay rise is good.
If it's inappropriate to give state workers 10% pay rises, why is it appropriate to give state pensioners a 10% pay rise?
What's the logic.
If it's a moral logic, then pray tell the logic the gov't has had behind cutting all other benefits bar state pension over and over again?
But you weren't askance when the minimum wage went up 10%.
Appreciate there are rather more state pensioners, but less clear whether the knock on effect in the labour market would have been bigger or smaller.
I really really think paying poorly over the long term is self defeating.
I've been doing this stuff long enough that I've seen the businesses that do well and not and how they pay, and you *never* see a firm that underpays outperforming in the long run.
The corollary isn't the case, overpaying is not a route to success either (poor people don't leave and weigh the business down), but underpaying means a good proportion of your best people will eventually leave.0 -
Don't understand the economics enough to meaningfully comment. I'm one of the people who nods like a wobbly head when I'm told an inflation wage spiral is bad.rick_chasey said:
TBH it's more an argument that the workers should also get the pay rise, rather than cutting the pensioners.First.Aspect said:
I don't disagree.rick_chasey said:
Genuinely, when it comes to stuff like macro economic policy, it shouldn't really matter if you're old or young.First.Aspect said:
Sure. Is it possible you have a chip on your shoulder about anyone older than you though?rick_chasey said:It is 100% annoying me that according to the govt, state workers asking for pay rises is bad, but pensioners getting a 10% state pay rise is good.
If it's inappropriate to give state workers 10% pay rises, why is it appropriate to give state pensioners a 10% pay rise?
What's the logic.
If it's a moral logic, then pray tell the logic the gov't has had behind cutting all other benefits bar state pension over and over again?
But you weren't askance when the minimum wage went up 10%.
Appreciate there are rather more state pensioners, but less clear whether the knock on effect in the labour market would have been bigger or smaller.
I really really think paying poorly over the long term is self defeating.0 -
Was reading an interesting thread by Julian Jessop yesterday in response to the 'corporate profits are driving inflation' strand of the debate. He made the point (I think) that different sides are blaming each other for inflation but fundamentally there is too much money sloshing around and each party is just fighting over who has control of it.1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
There is also the pricing mechanics of the market; corporate prices adjust much more quickly than labour prices, so in the lag you can get "higher profits" but in a fairly competitive market these then usually filter down into higher wages anyway.rjsterry said:Was reading an interesting thread by Julian Jessop yesterday in response to the 'corporate profits are driving inflation' strand of the debate. He made the point (I think) that different sides are blaming each other for inflation but fundamentally there is too much money sloshing around and each party is just fighting over who has control of it.
(Though that may just the capitalist talking his own book).0 -
Private sector pay vs public sector pay is. If private sector employers p*sses off its staff, then in extremis, they leave and the company goes out of business. If public sector loses its staff then it just adjusts by providing lower standards of service, which it can do as a monopoly supplier of services.rick_chasey said:So you think it's just bargaining?
Pensioners vs public sector pay isn't a bargaining issue, as pensioners can't jump ship to different state for a better state pension.
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Don't disagree. You asked for a moral argument though. The situation above is just a government favouring its core vote, which isn't particularly moral.rick_chasey said:...they [pensioners] had a slew of policies that go directly in their favour (including, above all, the triple lock!).
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Yes agreed and that is what annoys me.wallace_and_gromit said:
Don't disagree. You asked for a moral argument though. The situation above is just a government favouring its core vote, which isn't particularly moral.rick_chasey said:...they [pensioners] had a slew of policies that go directly in their favour (including, above all, the triple lock!).
I get that politics is in part about balancing competing interest, but it makes much more sense for governments to try and find balance, rather than nakedly going after one interest at the expense of another.
Ultimately that's why democracies tend to be richer better places to live than autocracies; they're inclined not to look after narrow interests.0 -
IIRC, Labour has always made a big thing of the Tories leaving pensioners destitute, and so supported the Triple Lock. It may even have been a Labour policy that the Tories stole! I don't think any politician touting it ever thought inflation would hit 10% again...rick_chasey said:
Yes agreed and that is what annoys me.wallace_and_gromit said:
Don't disagree. You asked for a moral argument though. The situation above is just a government favouring its core vote, which isn't particularly moral.rick_chasey said:...they [pensioners] had a slew of policies that go directly in their favour (including, above all, the triple lock!).
I get that politics is in part about balancing competing interest, but it makes much more sense for governments to try and find balance, rather than nakedly going after one interest at the expense of another.
Ultimately that's why democracies tend to be richer better places to live than autocracies; they're inclined not to look after narrow interests.
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Interesting thread on the water companies.
The figures are 👀1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
Yes but it's like the story of the scorpion and the frog isn't it?rjsterry said:Interesting thread on the water companies.
The figures are 👀
Why did they do that? Because they are scorpions.0 -
This Richard Murphy who I should add has really stuck his neck on the line that raising interest rates raises inflation, so he is also interested in demonstrating that fact.
For those who can read it, here is an actual utilities banker explaining the structure, answering 7 "common misconceptions"
https://www.ft.com/content/6c0b1144-89d1-434e-960c-ac298ceee781
there is far too much debt relative to income
Yes there is — £14bn of it — but it’s at the holding company level. The HoldCo owns the OpCo but it’s extremely constrained in its ability to extract dividends. There are typically about 30 covenants designed to limit dividend extraction and very prominent among them is “doing stuff the regulator doesn’t like.”
Foremost in the public interest are ensuring continuity of supply and avoiding bailouts. Even if we let everyone invested at HoldCo level lose out, neither worst-case-scenario has to happen.The privatised water utilities have given money to investors instead of funding improvementsIt’s only fair to note that they have done both. And actually, all the water companies are quite keen on making infrastructure improvements........
Regulator Ofwat tells the companies how much investment is required. It’s quite keen to do a lot of that, in my experience, but it’s restricted by the twin facts that fixing infrastructure is seriously expensive and all the costs go into bills.Thames Water was designed purely to extract cash flow and give it to shareholders
It’s the regulator who says what the dividends are going to be. That number is subject to negotiation between the water companies and their investment bank advisers, but basically it is the lowest number consistent with finding people to hold the paper
Now that interest rates are going up they are screwed
This is less of a problem than it looks. ...
There’s no justification for complexity of Thames Water’s capital structure
It’s not that complex to a specialist. Many times in finance you are going to see a lot of SPVs and capital structures have a lot of bonds in them
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Rwanda scheme ruled unlawful by the appeal court.
Good result for Rwanda, I'd say. £140m upfront and no ongoing costs.0 -
Bad for the tourist trade though, being officially classed as unsafe.kingstongraham said:Rwanda scheme ruled unlawful by the appeal court.
Good result for Rwanda, I'd say. £140m upfront and no ongoing costs.0 -
You can never quite get the banker out of some peoplerick_chasey said:This Richard Murphy who I should add has really stuck his neck on the line that raising interest rates raises inflation, so he is also interested in demonstrating that fact.
For those who can read it, here is an actual utilities banker explaining the structure, answering 7 "common misconceptions"
https://www.ft.com/content/6c0b1144-89d1-434e-960c-ac298ceee781
there is far too much debt relative to income
Yes there is — £14bn of it — but it’s at the holding company level. The HoldCo owns the OpCo but it’s extremely constrained in its ability to extract dividends. There are typically about 30 covenants designed to limit dividend extraction and very prominent among them is “doing stuff the regulator doesn’t like.”
Foremost in the public interest are ensuring continuity of supply and avoiding bailouts. Even if we let everyone invested at HoldCo level lose out, neither worst-case-scenario has to happen.The privatised water utilities have given money to investors instead of funding improvementsIt’s only fair to note that they have done both. And actually, all the water companies are quite keen on making infrastructure improvements........
Regulator Ofwat tells the companies how much investment is required. It’s quite keen to do a lot of that, in my experience, but it’s restricted by the twin facts that fixing infrastructure is seriously expensive and all the costs go into bills.Thames Water was designed purely to extract cash flow and give it to shareholders
It’s the regulator who says what the dividends are going to be. That number is subject to negotiation between the water companies and their investment bank advisers, but basically it is the lowest number consistent with finding people to hold the paper
Now that interest rates are going up they are screwed
This is less of a problem than it looks. ...
There’s no justification for complexity of Thames Water’s capital structure
It’s not that complex to a specialist. Many times in finance you are going to see a lot of SPVs and capital structures have a lot of bonds in them. On one Sunday, by completing the securitisation analysis, I created £236mn of value for the vendors. Some people will argue that this is not real money or value, and fair enough. But those subsequently employed in projects funded by that cash flow, and the many pensioners who were indirectly invested in the vendor, might think differently.
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I know he is on Twitter, but he is an accounting specialist and I don't think he really understands the structure. It can be added to the long list of things that annoy me - people with expertise in one area commenting on other areas and claiming expertise. For example, a doctor declaring that a bike helmet has saved someone's life.rjsterry said:Interesting thread on the water companies.
The figures are 👀0 -
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How is at least one of them not photoshopped in there?0
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All fair comment. Certainly don't think he's a disinterested observer, but who is?TheBigBean said:
I know he is on Twitter, but he is an accounting specialist and I don't think he really understands the structure. It can be added to the long list of things that annoy me - people with expertise in one area commenting on other areas and claiming expertise. For example, a doctor declaring that a bike helmet has saved someone's life.rjsterry said:Interesting thread on the water companies.
The figures are 👀1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
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Think I am.rjsterry said:
All fair comment. Certainly don't think he's a disinterested observer, but who is?TheBigBean said:
I know he is on Twitter, but he is an accounting specialist and I don't think he really understands the structure. It can be added to the long list of things that annoy me - people with expertise in one area commenting on other areas and claiming expertise. For example, a doctor declaring that a bike helmet has saved someone's life.rjsterry said:Interesting thread on the water companies.
The figures are 👀0 -
🤨TheBigBean said:
Think I am.rjsterry said:
All fair comment. Certainly don't think he's a disinterested observer, but who is?TheBigBean said:
I know he is on Twitter, but he is an accounting specialist and I don't think he really understands the structure. It can be added to the long list of things that annoy me - people with expertise in one area commenting on other areas and claiming expertise. For example, a doctor declaring that a bike helmet has saved someone's life.rjsterry said:Interesting thread on the water companies.
The figures are 👀
Makes you wonder how the Victorian corporations that started the whole thing managed.rick_chasey said:This is the ownership structure fwiw.
1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
As per the article i linked above (read the comments in it too, they're not persuaded by said banker), this kinds of structure is apparently not especially complex in this kind of world.0
