BS: A well balanced fair budget! (UK)

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 25 Jun 10 - 06:29 PM

Point taken, McG, but it would be a whole lot better still if the manufacturing of the stuff was providing jobs here.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 26 Jun 10 - 01:21 PM

Except that unlike income tax it is aimed at those who are poorest, even those who don't earn enough to pay income tax

Not strictly true, the many thousands of builders, plumbers, electricians, car mechanics and even Accountants etc who earn up to £38k from their owned companies as salary/dividend also don't earn enough to pay income tax - and neither they nor their companies pay National Insurance on that income either. The VAT increase is also aimed at these people.

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 02:09 PM

'Those who are poorest'

Would that be the tramp in the shop doorway who doesn't owe anything to anyone, or the man in the nice three bedroom detached with all the trappings and a £2-300k mortgage/debt that he might not live long enough to pay?

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 26 Jun 10 - 02:55 PM

It also applies to the man in the nice £2-300K house with no mortgage!

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 03:27 PM

It does, indeed.

My point was that net worth and standard of living don't necessarily correlate, and I wasn't sure exactly what McG meant by 'poorest'.

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 04:47 PM

The whole idea of reducing one's net worth to negativity in order to increase one's standard of living has always seemed a bit on the Lewis Carroll side to me, yet a huge section of society is perpetually in debt and living quite comfortably on it. I don't judge them or blame them, but even though they are the poorest members of society I don't see why they should be spared VAT. I don't see how the economy can sustain them forever, either.

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 26 Jun 10 - 05:18 PM

It has become obvious to me whilst reading back over this thread that some people have no idea what real poverty is... even in our own country. They pontificate about certain stereotypes they seem to recognise but the truth about poverty is not apparent. When people are living on or below the 'bread line' ... they are the real poor... and any increase in tax of any sort is a punishment for them. They have no reserves to call on to meet an increase. When people are interviewed on TV about the budget and how the increase will affect them.. they are mostly presentable middle or lower middle class people who will have to draw in the purse strings a bit to meet the rise... not those who have nothing left to meet it!!!

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 05:32 PM

Absolutely right, but people literally on or below the breadline don't pay income tax and can't afford VAT rated stuff.

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 26 Jun 10 - 05:47 PM

I guess you are doing the same Smokey.. inasmuch as there are people with partners who can't work who they have to support and their 4-5 children to feed and clothe. They maybe need a car to get to work.... on a minimum wage.... and they do pay tax as well as VAT on fuel... those people are classed as poor and they don't necessarily drink or smoke their money away as some of those on benefits do........ Our wonderful coalition have upped the income tax threshold but it aint enough to help the real poor.
To all of you... you seem to have stereotypes of the poor... some of you think they can do something about it but they can't.. they are stuck with their lives and I guess many make the best of it even though they might be in debt.

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 05:53 PM

Isn't that just another stereotype?

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 26 Jun 10 - 05:54 PM

Why have 4-5 children then - unbelievable stupidity. Have these people never heard of birth control??

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 26 Jun 10 - 06:32 PM

Is there VAT on contraception?

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 27 Jun 10 - 03:20 AM

What I was trying to point out Smokey is that there are poor who do pay tax and VAT.. who can't afford the rises.... the ones I described are certainly not the whole picture. as you say they are one stereotype... but was only using to show an example of such.

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 27 Jun 10 - 04:01 AM

Bonzo you ask :-Why have 4-5 children then - unbelievable stupidity. Have these people never heard of birth control??----- I guess they might well have but some maybe Catholic and their beliefs preclude them from using birth control... some may not be able to afford birth control so for them it is a vicious circle...... there may be other reasons too... but you should not sit on your self righteous/judgemental throne and criticise them..

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 27 Jun 10 - 05:48 AM

What planet are you on? Damned stupid beliefs, ah but maybe they have baby dropping disease!

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 27 Jun 10 - 09:07 AM

Bonzo... I believe there is an age limit to be on this site... suggest you stick to childrens chat rooms and forums instead of trying to wind up sensible adults.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 27 Jun 10 - 11:01 AM

Funny how some people cannot be tolerant of others who hold a different viewpoint - unbelievable!!

[some may not be able to afford birth control]

Surely it's free??

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 27 Jun 10 - 11:24 AM

What I was trying to point out Smokey is that there are poor who do pay tax and VAT.. who can't afford the rises.... the ones I described are certainly not the whole picture. as you say they are one stereotype... but was only using to show an example of such.

That's all I was doing, Gs. You are right in what you say, there are those people around the threshold who are unfairly affected to a degree, but that's the case with any tax threshold and seems to be unavoidable. I don't think VAT is any less fair than income tax in that respect. They've raised the income tax threshold to try and mitigate the effect, presumably.

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 27 Jun 10 - 12:24 PM

Instead of raising the threshold it might have been better to have reinstated the 10% income tax band which the NewLabs took off us.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 27 Jun 10 - 12:31 PM

But you need a VAT rate of 20% so that the nannyed kids at school have nice easy calculations - just divide by 6 now to find the amount of VAT included in the price whereas before it was 7/47 - beyond the brains of many of the ipod generation!!!

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 27 Jun 10 - 04:16 PM

Have a heart, Bonzo, they still have to learn how to use a calculator either way.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 27 Jun 10 - 04:44 PM

A calculator to divide by 6?? I give up.

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 27 Jun 10 - 05:28 PM

Aye, but 50% of school leavers go to university now, so obviously either the teachers are much better at teaching or the kids are much cleverer :-)

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 28 Jun 10 - 03:11 AM

Or A levels are much easier!!!

Subject: RE: BS: A well balanced fair budget!
From: SPB-Cooperator
Date: 28 Jun 10 - 03:26 AM

Remind me not to use you to do my VAT returns, I would prefer to engage someone who would use an excel formula rather than someone who wastes time(and charges more) calculating with pen and paper or takes a chance doing in in their head.

Subject: RE: BS: A well balanced fair budget!
From: Backwoodsman
Date: 28 Jun 10 - 04:59 AM

I've seen a lot of Excel spreadsheets containing formulae that are bollocks. I only trust the ones I make - I always check other peoples' spreadsheet calculations with........my calculator or in my head. (But I come from a generation who didn't have calculators - we did it all by mental arithmetic).

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 28 Jun 10 - 05:38 AM

SUMIF($F$3:INDEX($F:$F,ROW()-1),"Closing Balance:",G$3:INDEX(G:G,ROW()-1))+SUMPRODUCT(--($F$2:$F$11766="Opening Balance:"),--($F$3:$F$11767=""),G2:G11766)

..a formula I devised recently!!!!!

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 28 Jun 10 - 07:37 AM

Me too BWM.... I can add a list of monetary values in my head quicker than anyone I know can do it on a calculator.....

Subject: RE: BS: A well balanced fair budget!
From: GUEST,Graham Bradshaw
Date: 28 Jun 10 - 07:47 AM

Some information about VAT.

As part of the EU, we are subject to many of the tax raising regulations. The minimum rate of VAT any EU country is allowed to levy is 15%, and the only ones on that rate are Cyprus and Luxembourg. The highest are Sweden and Denmark at 25%.

When the Labour government reduced our VAT to 15% last year, they had to get permission from the EU, and were only granted it on a temporary basis.

For some years, all member states have been under pressure to introduce 'tax harmonisation' measures. That means somewhere around the median rate in the range 19 - 22% - Germany & Greece 19%, Ireland 21%, Poland 22%, all the rest around the same level.

It was only a matter of time before we were required to come into line. The 20% rate was bound to happen eventually. Now was a good time to do it - it meant that they could blame it on the deficit as 'a necessary and unavoidable' measure, without having to admit that we are in fact ruled by Brussels and our Parliament has very little power in these matters.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 28 Jun 10 - 08:42 AM

So that's about the size of it (and we all now know who have 2" because they flew red cross flags from their cars!!!!!)

Subject: RE: BS: A well balanced fair budget!
From: MikeL2
Date: 28 Jun 10 - 09:39 AM

hi

It's all very interesting to see the way in which to calculate the new VAT rate....but......I don't see that has anything to do with the thresd subject eg the fairness/unfairness of the budget.

On this topic has anyone any thoughts about something that seems to have been written into the "small print" of last week's budget.

In raising the income tax rate by £1000 they have pro rate to reduce the minimum rate for the high earners. This will bring some people who currently earn less than the high rate into being taxed at 40%.

This is going to hit some people hard........???

Cheers

MikeL2

Subject: RE: BS: A well balanced fair budget!
From: theleveller
Date: 28 Jun 10 - 10:31 AM

"Unfortunately, leveller's opinion stands for nothing against the Taxes Acts."

""subject to whether leveller thinks it moral or not"!!!!!!!"

"Funny how some people cannot be tolerant of others who hold a different viewpoint - unbelievable!!"

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 28 Jun 10 - 11:07 AM

MikeL2>>>>>>n raising the income tax rate by £1000 they have pro rate to reduce the minimum rate for the high earners. This will bring some people who currently earn less than the high rate into being taxed at 40%.<<<<, Not sure what you are trying to say here... All tax payers will not pay tax on the extra amount of threshold..... ie everyone who pays tax will pay less! how can anyone be pushed into the 40% bracket?

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 28 Jun 10 - 05:23 PM

In raising the income tax rate by £1000 they have pro rate to reduce the minimum rate for the high earners. This will bring some people who currently earn less than the high rate into being taxed at 40%.

This is going to hit some people hard........??? (MikeL2)

Sorry to seem a bit thick, Mike, but I'm not sure what your point is there. Have they brought down the 40% threshold, and by how much? I seem to have missed that, but I'll not exactly lose any sleep over it..

Interesting post from Graham Bradshaw - I didn't realise any of that, though as I said earlier, I reckon NewLab would have done about the same with VAT. It certainly isn't aimed at the 'poor', as some would claim. If the budget had been intended to disproportionately hit the 'poor', they'd have increased the duty on fags and booze, same as they always do. Increasing VAT is a fairer way of raising revenue than most.

The main problem seems to be that too many people have expectations way beyond their means - a situation which has been actively encouraged by both main parties for many years. It worries me that more people couldn't/can't/wouldn't/won't see through the scam. True, no-one wants to be poor, but an illusion of wealth is no substitute for the real thing, and sooner or later there has to be a reckoning.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 29 Jun 10 - 05:26 AM

The personal allowance for those under 65 will rise by £1000 to £7475 for 2011/12. The basic rate limit for 2011/12 will be reduced so that higher rate taxpayers will not beneifit from the increase in the personal allowance - got it?

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 29 Jun 10 - 06:42 AM

A trick for saving Capital Gains Tax on say selling a holiday home (not your main residence), is to make sure that it is in both your and your spouse's names. Then, you may benefit from different tax rates if one is not a higher rate tax payer.

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 29 Jun 10 - 07:47 AM

Bonzo.. that still does not make sense.... everyone gets the increase in the allowance.... how can any basic rate limit change that or its effect.. I guess I must be a bit thick eh??? Maybe you need to spell out exactly what you mean.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 29 Jun 10 - 09:19 AM

What it means is that the amount of income over which higher rate tax will become payable will be reduced by £500 (I think).

Increased personal allowance of £1000 at 20% = £200 tax reduction for basic rate taxpayers.

Higher rate tax payers will pay tax at 40% on taxable income over £36,901 - the current start amount is £37,401 - so up to an additional £200 tax will be paid (37401-36901 = £500 x 40% =£200)

Subject: RE: BS: A well balanced fair budget!
From: Georgiansilver
Date: 29 Jun 10 - 09:40 AM

I think you will find it will make no difference to the higher rate tax other than allowing the £1000 extra... the same as everyone else. Nothing was said about lowering the higher threshold.

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 29 Jun 10 - 10:08 AM

Ah, the exact figure for basic rate limit will be confirmed later in the year!

From HMRC notice BN01 22/06/10

Legislation will be introduced to provide for the following income tax and National Insurance Contributions (NICs) changes for 2011-12:
• the personal allowance for those aged under 65 will be increased by £1,000 to £7,475;
• the basic rate limit will be reduced so that higher rate taxpayers do not benefit from the increase in the personal allowance. The exact figure will be confirmed when September's Retail Prices Index (RPI) is known;
• the alignment of the Upper Earnings/Profits Limit (UEL/UPL) with the higher rate threshold (the total of the personal allowance for those aged under 65 and the basic rate limit) will be maintained by reducing the UEL/UPL; and
• the secondary threshold, which is the point at which employers start to pay Class 1 NICs, is to be increased by an extra £21 per week above indexation.

Subject: RE: BS: A well balanced fair budget!
From: theleveller
Date: 29 Jun 10 - 10:30 AM

Yes, I'm sure there's a lot that will only become apparent later. The devil is most definitely in the detail - did anyone expect anything else from Bloody Thatcher's spawn?

Subject: RE: BS: A well balanced fair budget!
From: Bonzo3legs
Date: 29 Jun 10 - 10:40 AM

Correct - we got it from brown for the past 13 years if you remember - quite normal for a budget whatever the party. In any case it's still only a Finance Bill at the moment and no doubt changes will be made before Royal Assent.

Subject: RE: BS: A well balanced fair budget!
From: Arthur_itus
Date: 29 Jun 10 - 12:11 PM

I have already stated that we are not well off and are just about surviving.
What is really hurting us now, is that the pound has strengthened to the Euro. Most of our income is in Euro's.
My wife has just received a payment of euro's from a company she did work for. The swing in the pound means that if you are being paid a 1000 euros, today it is worth £50 less than a couple of weeks ago.

So if you are an exporter as my wife is, we as a family are being hit even harder. That cannot be good for the economy of the country and exporters.

All our money is spent locally.

Hope that makes sense

Subject: RE: BS: A well balanced fair budget!
From: Smokey.
Date: 29 Jun 10 - 12:53 PM

Thanks for making that clear, Bonzo. I'd have thought it was normally rather uncharacteristic of "Bloody Thatcher's spawn" to take from the rich and give to the poor. I think under the circumstances your initial description of the budget is a pretty accurate one. As I said much earlier, it could have been worse.

Subject: RE: BS: A well balanced fair budget! (UK)
From: Bonzo3legs
Date: 30 Jun 10 - 04:45 AM

So if you are an exporter as my wife is, we as a family are being hit even harder. That cannot be good for the economy of the country and exporters.


But currency fluctuations have always been with us, it's just a chance you take. It can work in your favour - look what happened to the US$ a couple of years ago!!

When we booked our hotel in Italy during September a couple of years ago, the Euro was 1.20 to the £. When we had our holiday in the following April, the Euro was 98c to the £!!!

Subject: RE: BS: A well balanced fair budget! (UK)
From: Arthur_itus
Date: 30 Jun 10 - 04:58 AM

I agree Bonzo, but it still hurts the pocket when you least need it.