General Election 2017 | Cabinet reshuffle: Hunt re-appointed Health Secretary for record third time

[Jippy]

That's why a Wealth Tax is needed, not a larger income tax.

And the best way to implement a Wealth Tax is via an Inheritance tax. Especially when holding money on a hedge fund or just the general stocks and shares market should cause your money to increase 10 fold every 35 years. A decent inheritance tax should be of no issue whatsoever.

New money is earned. Old money is not

IHT is heinous- had this debate on here before, but I guess we will never agree on this subject.

Please someone correct me if I am wrong with any of the following:

If you are married your inheritance tax allowance doubles to up to £850k before you pay anything.

So - if you were married and had a £1m estate, which you left fully to your partner and then your your children, then they would pay £60k tax on that estate. A 6% tax on the full amount.

Bear in mind again that the "stocks and shares market" grows on average 7% a year.

Okay, well maybe that is still too much? Then put as much as you can in your pensions and use that as a tax relief vehicle?

Or maybe that is still too much? Give away some of your income as a gift each year and hope you live an extra 7 years.

And if you really don't want to pay any more tax, put it in a trust fund.

You are right - only idiots pay inheritance tax. But at the same time, inheritance tax should be more (or at least, close the loopholes) not less!!!!

The FTSE is only up 12% over the last decade and there have been gigantic gyrations within that period- investing in the stock market is by no means risk free.

I also had to take on a masters loan and the prior student debt but i don't have any associated feelings of now being treated as unfairly because i pay a higher band of tax (although i assume much less than Jippy).

The schools, universities, general economy and country we live in don't come free of any contribution. I'm not being punished for doing well, im taking the advantages offered to me by a working society and in line i benefit and the tax man benefits, all this will allow others to do the same or the disabled to live a life.

If you see tax as a purely consumption model where you're paying for a service then your going to be annoyed as others pay less for doing less (for whatever reason).

Wealth creators is a ridiculous notion as well, fine if you're an exporter and bringing money in okay. However the majority of the rich are not creating wealth they're absorbing domestic wealth and expending it (to a lesser degree), they rely on a functioning society to absorb from.

Dunno if you much less if you pay higher rate tax tbh. You certainly a more positive take on tax than me, to your credit.

 

[Unmutual]

The reported figure has just risen to 100bn and the chief negotiator is insisting on one lump sum, to which we've told them to go forth and multiply. Where does Labour go after that, that they would accede to Brussels' demands?

It is my impression that the more we hear our of Europe the stronger May's electoral position becomes, out of defiance if nothing else.

For all Remainers unhappiness at the bullish approach of Theresa May, I don't doubt for a second that it'll play well with much of the public. Lots of people already think the EU has been forcing its will on the UK for too long, this will totally reinforce that belief.

 

[Smores]

It does have to do with children's well being. They will be better off without having £x much less as an inheritance. That fact will affect me during my lifetime, decisions I take etc.
Yes, property will form a massive %age of what I end up with most likely, unless I win the lottery or something. However, I will have spent 25+ years paying for that house. Saving for a deposit, paying stamp duty when I bought it and then paying interest on a loan, which the last statement showed over the course of the term I'll be paying 165% I think it was of the total loan amount back (and no PPI bonus either )

IHT receipts in 2015-16 were £4.6bn. Honestly, I'd rather pay more income tax now than getting a final bill at the end of it.

As a comparison, in the US, the inheritance tax threshold is $5.45m per individual.

Fair enough but i disagree strongly, if you've owned property in any part of London for that length of time you've benefited hugely from circumstance you lucky sod. IHT isn't really the tax to manage that but its at least some way.

I live in the South East and from the youngsters i meet at work im not sure the promise of a hefty unearned windfall is healthy for them. Off topic though

 

[Paul the Wolf]

The reported figure has just risen to 100bn and the chief negotiator is insisting on one lump sum, to which we've told them to go forth and multiply. Where does Labour go after that, that they would accede to Brussels' demands?

It is my impression that the more we hear our of Europe the stronger May's electoral position becomes, out of defiance if nothing else.

I believe you are misinformed, firstly as Barnier says the final sum has not been calculated and payments will be defined by the forthcoming talks depending on whether the Uk wish to pursue a future relationship or whether they want to make a run for it without paying their bill, whatever that may be.

 

[Nytram Shakes]

The reported figure has just risen to 100bn and the chief negotiator is insisting on one lump sum, to which we've told them to go forth and multiply. Where does Labour go after that, that they would accede to Brussels' demands?

It is my impression that the more we hear our of Europe the stronger May's electoral position becomes, out of defiance if nothing else.

im a bit confused by the whole thing, ive just posted asking about in the Brexit thread, but ill ask again here, i don't get why May is getting so much stick for saying things like no deal is better then a bad deal..... what do people want her to say? we will accept any deal the EU offers and pay all their demands wether reasonable or unreasonable?

for the record im not a conservative voter, ill be voting labour..... but this issue is confusing me

 

[Classical Mechanic]

I believe you are misinformed, firstly as Barnier says the final sum has not been calculated and payments will be defined by the forthcoming talks depending on whether the Uk wish to pursue a future relationship or whether they want to make a run for it without paying their bill, whatever that may be.

The tone of debate through UK papers is very shallow currently. I heard one of May's negotiating team on Radio 4 earlier and he said that the UK has no intention whatsoever of turning its back on its international obligations. The devil is in the detail and that is the sticking point currently.

He seemed very level headed and reasonable but then they had Lord Lawson on straight after and his attitude was 'offer them a mutually beneficial trade deal, no strings attached, and if they don't want it leave with no deal'. He had very good things to say about Barnier, however.

 

[rcoobc]

The FTSE is only up 12% over the last decade and there have been gigantic gyrations within that period- investing in the stock market is by no means risk free.

Indeed, but when we are talking about inheritance, we are talking about long periods. And choosing just the "last decade" is a bit silly, as 10 years ago happens to coincide with the highest period before the crash. Basically, saying that the FTSE 100 is up over the last 10 years is almost a worst case scenario! (ish)

And that is just one index in one country. The S&P 500 and S&P Completion Index have both roughly doubled in the same period.... Which gives the required 7% a year, or increasing tenfold every 35 years.

 

[Paul the Wolf]

The tone of debate through UK papers is very shallow currently. I heard one of May's negotiating team on Radio 4 earlier and he said that the UK has no intention whatsoever of turning its back on its international obligations. The devil is in the detail and that is the sticking point currently.

He seemed very level headed and reasonable but then they had Lord Lawson on straight after and his attitude was 'offer them a mutually beneficial trade deal, no strings attached, and if they don't want it leave with no deal'. He had very good things to say about Barnier, however.

These figures are being used to assist May in her election campaign. Stir up the rabble. The idea that May and her cronies are throwing their toys out of the pram instead of sitting down and having serious discussion with their counterparts in the EU seems quite ridiculous.

 

[The Purley King]

Fair enough but i disagree strongly, if you've owned property in any part of London for that length of time you've benefited hugely from circumstance you lucky sod. IHT isn't really the tax to manage that but its at least some way.

I live in the South East and from the youngsters i meet at work im not sure the promise of a hefty unearned windfall is healthy for them. Off topic though

Yes - I have benefited from circumstance - in that house prices have gone stratospheric in the last decade. But it didn't take Einstein to realise the way things were headed and you were way better off even at the foot of the ladder than not on it at all - as the first rung of the ladder was getting progressively further off the ground year on year.
I agree completely that the promise of a large lump sum at 21 is more often than not a very bad idea. Hopefully my kids will be at least 40 when I croak, so they should have got all the bad decisions out of the way by then.......
Anyway - realise I have derailed the thread, so will stop waffling on.

 

[Unmutual]

im a bit confused by the whole thing, ive just posted asking about in the Brexit thread, but ill ask again here, i don't get why May is getting so much stick for saying things like no deal is better then a bad deal..... what do people want her to say? we will accept any deal the EU offers and pay all their demands wether reasonable or unreasonable?

for the record im not a conservative voter, ill be voting labour..... but this issue is confusing me

To my mind, it basically boils down to a choice of negotiating tactics. The Tories are approaching it in a kind of aggressive big business type way, all bombast and threatening to walk away. Labour are much more constructive and friendly. Some voters will think that the Tories are aggravating an otherwise reasonable bunch of people and will end up with a worse deal. Others will think Labour are a soft touch and would get taken to the cleaners.

Fwiw, whoever is negotiating has to have leaving with no deal as a Plan B, and they have to define clearly at what point Plan B is better than Plan A. While I generally prefer Labour's stance on the negotiations, going into it saying that you need a deal whatever the terms is clearly handing an advantage to the other side.

 

[Smores]

im a bit confused by the whole thing, ive just posted asking about in the Brexit thread, but ill ask again here, i don't get why May is getting so much stick for saying things like no deal is better then a bad deal..... what do people want her to say? we will accept any deal the EU offers and pay all their demands wether reasonable or unreasonable?

for the record im not a conservative voter, ill be voting labour..... but this issue is confusing me

Both polar opposites stated are idiotic, as always the best route falls somewhere in the middle. She isnt doing what she's doing because its an effective negotiation tactic, its because it plays well with the public who just voted brexit.

There's nothing wrong with approaching it proffesionally, both parties have a lot to add or lose that should be the basis of negotiations not who can act tougher. No deal is better than a bad deal is just approaching it with unnecessary hostility.

 

[LuisNaniencia]

May has terrible posture. Starting to doubt she went to finishing school.

 

[PedroMendez]

If you see tax as a purely consumption model where you're paying for a service then your going to be annoyed as others pay less for doing less (for whatever reason).

Only few people actually advocate for something like a strict flat tax or a shift to only taxing consumption. Almost everybody who earns above average is okay with paying (relatively) more taxes. It is a well-established fact, that the top earners pay a lion-share of the taxes and nobody questions that.

Where I have to shake my head is this Robin Hood mentality that is not even trying to understand the other side. If you earn somewhere between 80k-150k, you are obviously pretty well off, yet you also do pay a shitload of taxes and social security. Your earnings are still in a range, where different rates can make a substantial difference to your life. The idea that it is okay to press every penny out of you, because “you are rich” is so weird. But it goes further down and bracket creep has essentially increased the taxes for people who earn above average without being super rich; at least in Germany. A German economic think tank (IW) is going to release a study soon with some mind-blowing findings; I am not allowed to publish the unfinished working paper, but will link to it once it’s out.

Additionally, whats usually getting ignored is the question of social mobility. That is much more important. Having rich people is not a problem, if you can work your way up through your life-time. They people who earn a lot of money (excluding some super richt 0,0001%) change fairly frequently.

The problem is that the narrative that people like Corbyn push is as far away from reality as the narrative, that some right-wing lunatics push forward. I don’t hate poor people, because I fancy a nuanced approach towards taxation. Additionally the details of the tax code matter, because this legislation sets incentives and create unintended secondary effects. Looking at all of that just from a class warfare lens makes no sense. We are not living in the 19th century anymore.

 

[Nytram Shakes]

Both polar opposites stated are idiotic, as always the best route falls somewhere in the middle. She isnt doing what she's doing because its an effective negotiation tactic, its because it plays well with the public who just voted brexit.

There's nothing wrong with approaching it proffesionally, both parties have a lot to add or lose that should be the basis of negotiations not who can act tougher. No deal is better than a bad deal is just approaching it with unnecessary hostility.

i agree she probably shouldn't have said it as offen, and the best route is somewhere in the middle, but in fairness she has been pressed on the issue again and again, basically all she is getting asked over are the TV debates and the negotiations and what if they breakdown.

i dunno i agree that she could have done it a way that isnt as hostile, but really out of all things things i dislike about May and her goverment, saying she won't accept a bad deal, is not one of them.

don't get me wrong i don't think she will get a good deal for the UK, and think she will happily sell the working class and the lower middle class down the river if she thinks it will keep prosperity to the richer people in the country, but taken on its own, i don't really have any criticism of her saying she just won't accpet a bad deal.

 

[Jippy]

Indeed, but when we are talking about inheritance, we are talking about long periods. And choosing just the "last decade" is a bit silly, as 10 years ago happens to coincide with the highest period before the crash. Basically, saying that the FTSE 100 is up over the last 10 years is almost a worst case scenario! (ish)

And that is just one index in one country. The S&P 500 and S&P Completion Index have both roughly doubled in the same period.... Which gives the required 7% a year, or increasing tenfold every 35 years.

I'm just trying to point out that the index can also go nowhere over long periods of time too. The S&P is up 59% over 10 years.

 

[Dobba]

Strong and stable, strong and stable.

 

[altodevil]

Such a depressing election, at least Cameron and co. weren't leaving the EU for no reason, and made us think we had a chance at ousting them. Resistance is futile in 2017.

 

[PedroMendez]

I'm just trying to point out that the index can also go nowhere over long periods of time too. The S&P is up 59% over 10 years.

Just use huge leverage, so small changes can make you poor. Brand new, just for you: the SEC approved quadruple-leveraged ETFs.

http://www.reuters.com/article/us-sec-etfs-idUSKBN17Z009?il=0

 

[Dan]

 

[PedroMendez]

Don’t post this pic on twitter or Labour will lose another 5% with working class people.

 

[Nogbadthebad]

So, she's gone full farage.

You never go full farage.

 

[rcoobc]

I'm just trying to point out that the index can also go nowhere over long periods of time too. The S&P is up 59% over 10 years.

Indeed. This is the often used graph from an early version of Tim Hale's book

Spoiler

But the point is, inheritance is the perfect vehicle to take advantage of this 'buy the market and hold' mentality. Pensions are in UK stocks and shares, after all. If you left your children £100 million, and 35 years they left it to their children, it could have turned into £10 billion in today's money.

I can't see any other way that a decent inheritance tax to solve the problem of the rich becoming super rich, and the poor becoming poorer.

 

[Raees]

@Dan That is hilarious. She's such a awkward creature.. something about her just gives off vibes of Satan.

 

[ThierryHenry]

Shameful approach to negotiations from May. Attack Brussels to win votes at home, hurting our chances of a smoother Brexit deal in the long run.

She's as unbelievably poor Prime Minister. If we had a competent opposition there's zero chance she'd be this popular.

 

[PedroMendez]

Indeed. This is the often used graph from an early version of Tim Hale's book

Spoiler

But the point is, inheritance is the perfect vehicle to take advantage of this 'buy the market and hold' mentality. Pensions are in UK stocks and shares, after all. If you left your children £100 million, and 35 years they left it to their children, it could have turned into £10 billion in today's money.

I can't see any other way that a decent inheritance tax to solve the problem of the rich becoming super rich, and the poor becoming poorer.

Does he explain how he calculated the underlying data of this graph? looks a bit dodgy.

 

[Jippy]

Just use huge leverage, so small changes can make you poor. Brand new, just for you: the SEC approved quadruple-leveraged ETFs.

http://www.reuters.com/article/us-sec-etfs-idUSKBN17Z009?il=0

Crikey I missed that. They only really work in day trading though. If you buy and hold they don't work as you'd expect, same with the short ETFs.

 

[Jippy]

Indeed. This is the often used graph from an early version of Tim Hale's book

Spoiler

But the point is, inheritance is the perfect vehicle to take advantage of this 'buy the market and hold' mentality. Pensions are in UK stocks and shares, after all. If you left your children £100 million, and 35 years they left it to their children, it could have turned into £10 billion in today's money.

I can't see any other way that a decent inheritance tax to solve the problem of the rich becoming super rich, and the poor becoming poorer.

It's only through recent rule changes that pensions can be passed down the generations. Wasn't possible when you had compulsory annuitisation.
You could of course use other financial planning means, eg trusts, as you flagged.

I read something the other day about wealth destuction when it's passed down the generations- might've been from a link on here. Wealth isn't typically passed down in perpetuity- some generation (often the third?) normally blows it.

 

[PedroMendez]

Crikey I missed that. They only really work in day trading though. If you buy and hold they don't work as you'd expect, same with the short ETFs.

Compounding for the loss. You’d need to rebalance every day, which is essentially day trading.

 

[711]

The problem is where you say 'for the most part he supports increasing ta

im a bit confused by the whole thing, ive just posted asking about in the Brexit thread, but ill ask again here, i don't get why May is getting so much stick for saying things like no deal is better then a bad deal..... what do people want her to say? we will accept any deal the EU offers and pay all their demands wether reasonable or unreasonable?

for the record im not a conservative voter, ill be voting labour..... but this issue is confusing me

No need to be confused, you're right.

 

[Adisa]

It's seems like our PM has takes the scorched earth approach. Burn everything down in order to win as big a majority as possible.
Part of me thinks she's given up on getting her so called best deal and will settle for a sticking plaster.

 

[rcoobc]

Does he explain how he calculated the underlying data of this graph? looks a bit dodgy.

No, and I think it isn't in the later versions of his book. But it will be generally correct

It's only through recent rule changes that pensions can be passed down the generations. Wasn't possible when you had compulsory annuitisation.
You could of course use other financial planning means, eg trusts, as you flagged.

I read something the other day about wealth destuction when it's passed down the generations- might've been from a link on here. Wealth isn't typically passed down in perpetuity- some generation (often the third?) normally blows it.

True

 

[PedroMendez]

No, and I think it isn't in the later versions of his book. But it will be generally correct

True

At the very best it might be an accurate ex-post description of a specific time frame. That doesn't mean that you can generalise this trend.

 

[rcoobc]

At the very best it might be an accurate ex-post description of a specific time frame. That doesn't mean that you can generalise this trend.

Well the past is no guarantee of future performance, yada yada yada, but the entire world relies on capitalism working.

We're talking about old wealth, over long time periods

 

[sun_tzu]

I can't see any other way that a decent inheritance tax to solve the problem of the rich becoming super rich, and the poor becoming poorer.

Tax investments more than income?

 

[PedroMendez]

Well the past is no guarantee of future performance, yada yada yada, but the entire world relies on capitalism working.

We're talking about old wealth, over long time periods

If the author is worth his money, he won't say, that this trend is anything but a description of the past. He probably removed it from his book, because it is simply outdated. I am not trying to be pedantic here; it is just a very important difference.

I can't see any other way that a decent inheritance tax to solve the problem of the rich becoming super rich, and the poor becoming poorer.

That statement is false. The poor are not (economically) becoming poorer. On the contrary. The poorest people in the world are escaping poverty at a higher rate than ever. Not because of some brilliant developmental strategy - almost all of them failed miserably - but because poor countries started to move towards a free-enterprise system for most normal goods. Such a system reliably creates a higher standard of living for the broad populus.

Yet even if you just look at developed western countries, the statement would still be wrong. Economically even the poorest people are not worse off than they were 25 years ago. Additionally it is a fallacy to assume that just because some people are becoming very rich, that this means that poor people have to stay poor.

 

[montpelier]

all wealth, any wealth is GOOD !!! even more so, if it's MINE !!! (or my kids)

feck EVERYBODY ELSE !!!

Justifications for a belief in Hayekian trickle-down & that it is a process which makes everything all right, really piss me off.

 

[rcoobc]

If the author is worth his money, he won't say, that this trend is anything but a description of the past. He probably removed it from his book, because it is simply outdated. I am not trying to be pedantic here; it is just a very important difference.

If you say so!

That statement is false. The poor are not (economically) becoming poorer. On the contrary. The poorest people in the world are escaping poverty at a higher rate than ever. Not because of some brilliant developmental strategy - almost all of them failed miserably - but because poor countries started to move towards a free-enterprise system for most normal goods. Such a system reliably creates a higher standard of living for the broad populus.

Yet even if you just look at developed western countries, the statement would still be wrong. Economically even the poorest people are not worse off than they were 25 years ago. Additionally it is a fallacy to assume that just because some people are becoming very rich, that this means that poor people have to stay poor.

Yeah, I'm being a bit facetious when I say the poor are getting poorer... but...

In the future we face automation cutting jobs, we already face high levels of unemployment in Europe (or lots of apprenticeship and temporary jobs in the UK), we face "misplaced" jobs where people with degrees in geography will end up working in completely separate fields.

Will these trends continue? All the while the super rich go owning more than the bottom 50% of the world, to the bottom 90% of the world, to the bottom 99% of the world.

 

[Mozza]

If the author is worth his money, he won't say, that this trend is anything but a description of the past. He probably removed it from his book, because it is simply outdated. I am not trying to be pedantic here; it is just a very important difference.




That statement is false. The poor are not (economically) becoming poorer. On the contrary. The poorest people in the world are escaping poverty at a higher rate than ever. Not because of some brilliant developmental strategy - almost all of them failed miserably - but because poor countries started to move towards a free-enterprise system for most normal goods. Such a system reliably creates a higher standard of living for the broad populus.

Yet even if you just look at developed western countries, the statement would still be wrong. Economically even the poorest people are not worse off than they were 25 years ago. Additionally it is a fallacy to assume that just because some people are becoming very rich, that this means that poor people have to stay poor.

The poor have had their lives bettered by technology, capitalism is not always been the driver of innovation. Tax in the 90% bracket didn't stop the booms of the post war years

 

[Sweet Square]

 

[Unmutual]

As you were, basically. Still looks like a modest uptick in Labour's fortunes overall when you look at the poll of polls, but well within the margin of error.

However Theresa May's dead cat yesterday is likely to swing the polls her way again I reckon. Partly because the EU remains a popular enemy, but also because it puts Brexit squarely at the middle of the election again, which suits her and not Labour.