Westminster Politics

finneh said:
Agreed (although my reduction of VAT wouldn't be temporary).

I'd also like to see an increase in the tax free allowance. Increasing the minimum wage above inflation in the current climate is going to be hugely counterproductive but giving a pay rise to particularly lower earners should be a priority.

I'm not sure if it's workable but I also wonder whether some sort of temporary corporation tax relief could be given to companies that take on young people over the next few years too since they'll be the worst hit (possibly a % of corporation tax so that businesses that avoid huge amounts would be prejudiced against).

With the minimum wage as it is and the pool of possible candidates for unskilled jobs as it will inevitably be I can't see the incentive for businesses to employ for example a 25 year old with very little experience.
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I expect you will see tax breaks (for example ni reductions) for employing apprentices graduates or long term unemployed
Possibly tax credits for training similar to r&d
I expext corporation tax to rise across most countries with the mantra of we bailed out companies in their hour of need... its now their duty to repay that help
 
finneh said:
Agreed (although my reduction of VAT wouldn't be temporary).

I'd also like to see an increase in the tax free allowance. Increasing the minimum wage above inflation in the current climate is going to be hugely counterproductive but giving a pay rise to particularly lower earners should be a priority.

I'm not sure if it's workable but I also wonder whether some sort of temporary corporation tax relief could be given to companies that take on young people over the next few years too since they'll be the worst hit (possibly a % of corporation tax so that businesses that avoid huge amounts would be prejudiced against).

With the minimum wage as it is and the pool of possible candidates for unskilled jobs as it will inevitably be I can't see the incentive for businesses to employ for example a 25 year old with very little experience.
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All good points.
I would certainly like to see petrol and diesel taxes increased so as to offset VAT reduction as well as a reduction in NI.

The fuel tax increases can easily be justified to help with climate change as well as increasing the incentive toward more electronic cars.

There is a need for large-scale innovation in order to mitigate the worst effects of the impending large recession.
 
sun_tzu said:
I expect you will see tax breaks (for example ni reductions) for employing apprentices graduates or long term unemployed
Possibly tax credits for training similar to r&d
I expext corporation tax to rise across most countries with the mantra of we bailed out companies in their hour of need... its now their duty to repay that help
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Would make sense although as corporation tax is so manipulatable I'd like to specifically see corporation tax relief factored in to training/graduates/employment.

Having businesses who've paid almost no corporation tax historically, who've also been the beneficiaries of the various Covid schemes, then being able to exploit subsidised labour in my view isn't equitable.

Rewarding businesses who have paid corporation tax by having the relief tied to tax paid seems a no brainer to me (although it might be unfeasible administratively).

Buster15 said:
All good points.
I would certainly like to see petrol and diesel taxes increased so as to offset VAT reduction as well as a reduction in NI.

The fuel tax increases can easily be justified to help with climate change as well as increasing the incentive toward more electronic cars.

There is a need for large-scale innovation in order to mitigate the worst effects of the impending large recession.
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See this is where we disagree. Fuel taxes in my view are one of the most regressive taxes in existence. The poorest in society can't afford electric cars and outside of London most have to travel dozens of miles to work. A tax on fuel is a tax on working for the poorest.

Setting aside my personal opinion (to quote a great man "I am favour of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible), I think if any additional taxes were to be implemented there's room for some sort of land tax to replace stamp duty, business rates and council tax all in one. Calculated on purpose of land, acreage and location.

With a bit of thought huge warehouses in the middle of nowhere, vast country estates and upper middle class houses with a few acres would pay more but smaller houses and businesses (particularly on the high street) would pay less. You could possibly relax planning restrictions to compensate for large increases in tax so that people could build more houses on their land in order to split their land tax. This might be a driver for more houses to be built and lower house prices. It would also stop people owning huge swathes of land for years with planning and not building on it in order to keep supply repressed and prices high (the second planning was granted turning land from agriculture into housing the owner would have to pay a land tax equivalent to the volume of houses they've been given planning for).

Again though it could be too administratively challenging.
 
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finneh said:
I'd also like to see an increase in the tax free allowance. Increasing the minimum wage above inflation in the current climate is going to be hugely counterproductive but giving a pay rise to particularly lower earners should be a priority.
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You can kinda do that yourself. Don’t wait for better people to do it for you.

Reduce your employees working weeks to something sensible like, y’know, 35-40 hours a week, and it’s an effective pay rise.
 
UnrelatedPsuedo said:
You can kinda do that yourself. Don’t wait for better people to do it for you.

Reduce your employees working weeks to something sensible like, y’know, 35-40 hours a week, and it’s an effective pay rise.
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Unless all my competitors do it at the same time it doesn't work as I'm effectively just ceding market share.

If the tax free allowance is increased its universal meaning a level playing field. If the philosophy is "let's wait for certain businesses to voluntarily make themselves less commercially competitive" we'll all be waiting a long time.
 
finneh said:
Unless all my competitors do it at the same time it doesn't work as I'm effectively just ceding market share.

If the tax free allowance is increased its universal meaning a level playing field. If the philosophy is "let's wait for certain businesses to voluntarily make themselves less commercially competitive" we'll all be waiting a long time.
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Question out of left field.... Are there any statues of you up in the UK?
 
finneh said:
So far out of left field you past John McDonnell about half an hour ago in a supersonic jet by any chance?
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If you worked as many hours as your employees are forced to, you’d probably have enough time to write a decent comeback and find a personality.[Im sorry for being awful, but your posts and attitude have really annoyed me and will probably irk me forever. You should block me]
 
Was going through old files and saw this screenshot from December, a few days before the election

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UnrelatedPsuedo said:
If you worked as many hours as your employees are forced to, you’d probably have enough time to write a decent comeback and find a personality.[Im sorry for being awful, but your posts and attitude have really annoyed me and will probably irk me forever. You should block me]
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Try to play the post and not the poster.

We won't agree on many things politically but surely allowing the poorest in society to keep more of their own money isn't contentious?
 
finneh said:
Unless all my competitors do it at the same time it doesn't work as I'm effectively just ceding market share.

If the tax free allowance is increased its universal meaning a level playing field.
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Raising the tax free allowance is not universal. Lots of low earners dont benefit from it.
 
EwanI Ted said:
Raising the tax free allowance is not universal. Lots of low earners dont benefit from it.
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Not to be too pedantic but to define universal "relating to or done by all people or things in the world or in a particular group, applicable to all cases"

The particular group in question (of which it would apply to all cases) would be those working 30+ hours a week.

Apologies if the context was misleading though (and naturally those not in this group would be positively affected by the VAT/fuel changes I mentioned)
 
finneh said:
Not to be too pedantic but to define universal "relating to or done by all people or things in the world or in a particular group, applicable to all cases"

The particular group in question (of which it would apply to all cases) would be those working 30+ hours a week.

Apologies if the context was misleading though (and naturally those not in this group would be positively affected by the VAT/fuel changes I mentioned)
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If you're talking about giving a pay rise to low earners, why exclude part time workers?
 
EwanI Ted said:
If you're talking about giving a pay rise to low earners, why exclude part time workers?
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The people you're talking about are almost certainly disproportionately affected by all or some of the other reductions I spoke about (VAT, Fuel duties, council tax).

I would guess those people are also disproportionately weighted to the under 30 band and so if businesses had corporation tax relief on either employing them or giving them more hours then again they'd indirectly see the benefit.

A combination of making things cost less (VAT), reducing the cost of living (council tax), reducing the cost to work (fuel reduction) and providing greater opportunities (corporation tax relief) in my view would be a positive cocktail of measures.

However if you can think of any other taxes that cutting would benefit the poorest most pertinently is probably agree with those too (NI reductions for instance).
 
finneh said:
The people you're talking about are almost certainly disproportionately affected by all or some of the other reductions I spoke about (VAT, Fuel duties, council tax).

I would guess those people are also disproportionately weighted to the under 30 band and so if businesses had corporation tax relief on either employing them or giving them more hours then again they'd indirectly see the benefit.

A combination of making things cost less (VAT), reducing the cost of living (council tax), reducing the cost to work (fuel reduction) and providing greater opportunities (corporation tax relief) in my view would be a positive cocktail of measures.

However if you can think of any other taxes that cutting would benefit the poorest most pertinently is probably agree with those too (NI reductions for instance).
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I've no problem with those other measures, or at least if tax reduction is your aim there are worse ways. But whatever benefits there were to raising the personal allowance back in 2010 when the Tories took over have long since been exhausted. The personal allowance has almost doubled in 10 years. At this point raising it further benefits middle and high earners but not low earners. That's before we consider who is impacted by the reduced spending power of the Government.

And by the way it mainly affects women, not young people. About 40% of women who work do so part time, vs about 13% men, and a quarter of women get paid below the voluntary living wage. About 60% of all low earners are women, and bear in mind there are less women in employment as a whole. So they're the one's most likely to miss out with personal allowance changes.
 
EwanI Ted said:
I've no problem with those other measures, or at least if tax reduction is your aim there are worse ways. But whatever benefits there were to raising the personal allowance back in 2010 when the Tories took over have long since been exhausted. The personal allowance has almost doubled in 10 years. At this point raising it further benefits middle and high earners but not low earners. That's before we consider who is impacted by the reduced spending power of the Government.
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That's where I disagree. In my view anyone earning £20k or less should not be paying a penny of income tax or national insurance. Truth be told any person that's entitled to benefits shouldn't be paying tax; it's illogical and cruel to take their money and then give it back to them like some sort of gift.

EwanI Ted said:
And by the way it mainly affects women, not young people. About 40% of women who work do so part time, vs about 13% men, and a quarter of women get paid below the voluntary living wage. About 60% of all low earners are women, and bear in mind there are less women in employment as a whole. So they're the one's most likely to miss out with personal allowance changes.
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I'm sure if you plotted it as a Venn diagram young women would probably be the worst affected and they would be the ones who would most benefit from their wages going further with a reduction in fuel duties and VAT, a reduction in council tax and an extra few hours of work a week made possible by CT relief.

I'd also abolish all taxes on utilities and also on insurance that is mandatory by law (e.g. car tax), as taxing the poor for heating their homes, educating their children via the internet and driving to work is inhumane.
 
finneh said:
That's where I disagree. In my view anyone earning £20k or less should not be paying a penny of income tax or national insurance.
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I know you're just thinking aloud, but you should really do a bit of checking first. Setting it at £20K would give the top 2/3 of earners a massive tax break at the expense of low earners. It does the exact opposite of what you want it to do.

Truth be told any person that's entitled to benefits shouldn't be paying tax; it's illogical and cruel to take their money and then give it back to them like some sort of gift.
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Firstly, its not cruel. Most people on benefits gain far more than they pay in tax, so they benefit massively on the arrangement.

Secondly, its not even illogical. If you accept that we should vary the amount people are entitled to based on their circumstances, then that variation has to be accounted for in either the taxation or the benefits system.

To build that into the tax system would create thousands of new tax codes to account for housing need, parental status, health, location etc and would create a completely incomprehensible tax system that would be packed full of loopholes. And it wouldn't obviate the need for a benefit system anyway, because some people have zero income, so you would still need one of them too. So the simplest thing is to keep the tax system as simple as possible, and have the complexity applied only to the benefits system. The fact that it leaves some people paying money out just to get it back again can be seen as a curiosity, but nothing more.
 
EwanI Ted said:
I know you're just thinking aloud, but you should really do a bit of checking first. Setting it at £20K would give the top 2/3 of earners a massive tax break at the expense of low earners. It does the exact opposite of what you want it to do.
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By your very statement it would help the vast majority of the bottom 2/3rds of earners.

Plus it would disproportionately help the lowest in the group as for example someone earning £20k per annum would see their net salary increase by more than 8% whereas someone on £40k would see less than a 4.5% rise.

I think helping middle earners is beneficial too as they will have seen their salaries hugely affected by Covid. I also think that a boost for middle earners would help stimulate the economy as they would then spend more which would drive greater VAT, corporation tax receipts etc, somewhat offsetting the cost.

EwanI Ted said:
Firstly, its not cruel. Most people on benefits gain far more than they pay in tax, so they benefit massively on the arrangement.
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Again I disagree it isn't cruel. Taking someone's money when they have precious little in the first place and deciding you know better than them as to what to spend it on, before offering them services (some of which they might not want or need) in return, if not cruel then at a minimum is contemptuous (for example using tax taken from someone who's family have never attended university and are unlikely to in the medium term future to subsidise the wealthiest people in the country to attend Oxford).

The bottom 10-15% at a minimum should be allowed to keep 100% of their own money rather than having the state forcefully sieze it from them in return for services they may not want or need.

This is something I believe in strongly but also accept I'm in the minority. I completely reject the right wing argument that poor people can't be trusted with money (I knows this isn't at all your argument)

EwanI Ted said:
Secondly,, its not even illogical. If you accept that we should vary the amount people are entitled to based on their circumstances, then that variation has to be accounted for in either the taxation or the benefits system. To build that into the tax system would create thousands of new tax codes to account for housing need, parental status, health, location etc and would create a completely incomprehensible tax system that would be packed full of loopholes. And it wouldn't obviate the need for a benefit system anyway, because some people have zero income, so you would still need one of them too. So the simplest thing is to keep the tax system as simple as possible, and have the complexity applied only to the benefits system. The fact that it leaves some people paying money out just to get it back again can be seen as a curiosity, but nothing more.
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In truth I did qualify that some of my "thinking aloud" was possibly unworkable from an administrative point or view. In a perfect world the tax system would far more straight forward (as would the benefits system) but we do have to work with what we have.

I've always liked the idea of a negative tax rate for example as the poorest people in society often paying an effective tax rate comparable to the highest earners in society (e.g. to earn an extra £1000 net of benefits they need to make £2000 from employment, an effective tax rate of 50%)
 
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finneh said:
By your very statement it would help the vast majority of the bottom 2/3rds of earners.
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When you raise the personal allowance, every earner already above the line benefits. People already below the line get no more benefit. £20K is the 34th percentile of income, which means as you successively raise the line everyone in the top 64% of earners benefit from every step of increase, while those at the bottom don't. People earning £100K get a bigger tax cut from it than people earning £15K. That's why it benefits high earners and not low earners.

Plus it would disproportionately help the lowest in the group as for example someone earning £20k per annum would see their net salary increase by more than 8% whereas someone on £40k would see less than a 4.5% rise.
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Very specious. In cash terms it would obviously be the same amount.

I think helping middle earners is beneficial too as they will have seen their salaries hugely affected by Covid. I also think that a boost for middle earners would help stimulate the economy as they would then spend more which would drive greater VAT, corporation tax receipts etc, somewhat offsetting the cost.
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It helps middle and high earners for sure, if that's the intention.

Again I disagree it isn't cruel. Taking someone's money when they have precious little in the first place and deciding you know better than them as to what to spend it on, before offering them services (some of which they might not want or need) in return, if not cruel then at a minimum is contemptuous (for example using tax taken from someone who's family have never attended university and are unlikely to in the medium term future to subsidise the wealthiest people in the country to attend Oxford).

The bottom 10-15% at a minimum should be allowed to keep 100% of their own money rather than having the state forcefully sieze it from them in return for services they may not want or need.
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We were talking about benefits, which are cash payments, not services.

In truth I did qualify that some of my "thinking aloud" was possibly unworkable from an administrative point or view. In a perfect world the tax system would far more straight forward (as would the benefits system) but we do have to work with what we have.

I've always liked the idea of a negative tax rate for example as the poorest people in society often paying an effective tax rate comparable to the highest earners in society (e.g. to earn an extra £1000 net of benefits they need to make £2000 from employment, an effective tax rate of 50%)
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A Negative Income Tax is a fine idea, but it still needs additional components to account for people's specific needs (not least variable housing costs), so it doesn't obviate the need for an additional form of benefit system.
 
EwanI Ted said:
When you raise the personal allowance, every earner already above the line benefits. People already below the line get no more benefit. £20K is the 34th percentile of income, which means as you successively raise the line everyone in the top 64% of earners benefit from every step of increase, while those at the bottom don't. People earning £100K get a bigger tax cut from it than people earning £15K. That's why it benefits high earners and not low earners.

Very specious. In cash terms it would obviously be the same amount.

It helps middle and high earners for sure, if that's the intention.

We were talking about benefits, which are cash payments, not services.

A Negative Income Tax is a fine idea, but it still needs additional components to account for people's specific needs (not least variable housing costs), so it doesn't obviate the need for an additional form of benefit system.
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I think you're focusing too veciferously on one of the measures I suggested out of a cocktail of several which would as a whole benefit the poorest to a great degree (certainly more than welfare programs that are more open to both exploitation, corruption and long term negative effects in my view).

A VAT decrease would disproportionately help the poorest as a higher % of their net income is taken from them; the same is true for fuel duty and mandatory insurance taxes; the same is true of council tax. I'd reiterate that judging the benefit of income tax relief as a % is far more pertinent than as a true figure; to turn it around it would patently be unfair to implement a flat £10k income tax even though "in cash terms they're paying the same".

I accept your benefits point in terms of direct welfare payments, I thought you were referring to services provides. I likewise agree a NIT couldn't be the sole measure, although in my view it should be by far the most important and other relief should fees into it rather than being separate programs in their own right (again enforcing an effective tax rate on the poorest akin to even middle earners, let alone the highest earners is patently unfair).
 
finneh said:
I think you're focusing too veciferously on one of the measures I suggested out of a cocktail of several which would as a whole benefit the poorest to a great degree (certainly more than welfare programs that are more open to both exploitation, corruption and long term negative effects in my view).

A VAT decrease would disproportionately help the poorest as a higher % of their net income is taken from them; the same is true for fuel duty and mandatory insurance taxes; the same is true of council tax. I'd reiterate that judging the benefit of income tax relief as a % is far more pertinent than as a true figure; to turn it around it would patently be unfair to implement a flat £10k income tax even though "in cash terms they're paying the same".

I accept your benefits point in terms of direct welfare payments, I thought you were referring to services provides. I likewise agree a NIT couldn't be the sole measure, although in my view it should be by far the most important and other relief should fees into it rather than being separate programs in their own right (again enforcing an effective tax rate on the poorest akin to even middle earners, let alone the highest earners is patently unfair).
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I do have a particular bee in the bonnet for personal allowance because its such a bad policy when it goes is beyond the bottom few percentiles of income. Its like saying that because the occasional glass of red wine is good for you, a bottle a day must be *really* good for you. It doesn't work that way.

On the other point about other taxes, the idea that if you cut taxes to that degree then low earners will have more money in their pockets but nothing else changes is completely bogus. Assuming you don't propose running a big deficit in perpetuity, then cutting tax that dramatically will also mean cutting public spending to the same degree. Cutting public spending disproportionally affects low earners through lower benefits and fewer services - simply put, they lose more than they gain. For those tax cuts to give a net benefit to low earners you'd have to re-profile pubic spending to benefit low earners over high earners. Honestly I doubt you've thought that far ahead, but if you have Im all ears.
 
EwanI Ted said:
I do have a particular bee in the bonnet for personal allowance because its such a bad policy when it goes is beyond the bottom few percentiles of income. Its like saying that because the occasional glass of red wine is good for you, a bottle a day must be *really* good for you. It doesn't work that way.

On the other point about other taxes, the idea that if you cut taxes to that degree then low earners will have more money in their pockets but nothing else changes is completely bogus. Assuming you don't propose running a big deficit in perpetuity, then cutting tax that dramatically will also mean cutting public spending to the same degree. Cutting public spending disproportionally affects low earners through lower benefits and fewer services - simply put, they lose more than they gain. For those tax cuts to give a net benefit to low earners you'd have to re-profile pubic spending to benefit low earners over high earners. Honestly I doubt you've thought that far ahead, but if you have Im all ears.
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In terms of the deficit you'd have two main options in my view. Considering the policies are a recovery mechanism from Covid the first would be to create a fiscal drag to return the levels to "normal" over a period of time (for example if the personal allowance were increased by 50% you'd leave it at that level until the minimum wage had increased by 50% to match).

However I'm more of the school of economics that believes governmental spending is inherently inefficient and so a mechanism for large reductions in public spending via tax cuts combined with both a negative tax rate and also some form of tapered basic income might be a solution (so for example to use simple figures if everyone was entitled to £10k a year but for every £4k they earned that would reduce by £1k). That combined with a Swiss style health insurance system, education vouchers allowing for free choice or top-up in education (the state then benefiting from private sector efficiency), a "nudge" auto enrollment savings/insurance system for social care (ala pensions currently) and the privatisation of public bodies such as the BBC, transport for London etc.

However the latter would obviously be deeply unpopular on here (and in truth I've discussed that to death so to bring this enjoyable conversation* to it's conclusion let's point to the former).

*Not sarcastically if it reads that way
 
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finneh said:
By your very statement it would help the vast majority of the bottom 2/3rds of earners.

Plus it would disproportionately help the lowest in the group as for example someone earning £20k per annum would see their net salary increase by more than 8% whereas someone on £40k would see less than a 4.5% rise.

I think helping middle earners is beneficial too as they will have seen their salaries hugely affected by Covid. I also think that a boost for middle earners would help stimulate the economy as they would then spend more which would drive greater VAT, corporation tax receipts etc, somewhat offsetting the cost.



Again I disagree it isn't cruel. Taking someone's money when they have precious little in the first place and deciding you know better than them as to what to spend it on, before offering them services (some of which they might not want or need) in return, if not cruel then at a minimum is contemptuous (for example using tax taken from someone who's family have never attended university and are unlikely to in the medium term future to subsidise the wealthiest people in the country to attend Oxford).

The bottom 10-15% at a minimum should be allowed to keep 100% of their own money rather than having the state forcefully sieze it from them in return for services they may not want or need.

This is something I believe in strongly but also accept I'm in the minority. I completely reject the right wing argument that poor people can't be trusted with money (I knows this isn't at all your argument)



In truth I did qualify that some of my "thinking aloud" was possibly unworkable from an administrative point or view. In a perfect world the tax system would far more straight forward (as would the benefits system) but we do have to work with what we have.

I've always liked the idea of a negative tax rate for example as the poorest people in society often paying an effective tax rate comparable to the highest earners in society (e.g. to earn an extra £1000 net of benefits they need to make £2000 from employment, an effective tax rate of 50%)
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I understand where you are coming from. Personally I think everyone should pay some tax if only so everyone has some vested interest in how the services we all use are paid for.
 
I am not against in principle of the merging of foreign aid into the foreign office . I just don't trust boris
 
Well done Marcus. I often read folk on the Cafe say the country's gone more right wing, but they can't have lived through Thatcher's time, there's no way that evil woman would have ever climbed down.
 
So from the news Starmer is trying to take credit for the government uturn in respect of free school meals. He is as much of a shit as Boris. It was soley down to our Marcus, bless him. All that any politician did was hang on to Rashfords coat tails.
 
"The PM fully understands the issue facing families across the UK during what is a difficult and unprecedented time".
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This, from a man who once described his journalist's salary of £250,000 a year as 'chicken feed'.
 
Virgil said:
So from the news Starmer is trying to take credit for the government uturn in respect of free school meals. He is as much of a shit as Boris. It was soley down to our Marcus, bless him. All that any politician did was hang on to Rashfords coat tails.
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Tbf he isn’t, and Starmer mentioned it in PMQs a week ago.
 
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