Tories come up with good idea.....

harry_w

Jennifer_Jane wrote: »

Zero interest rates on savings will only help people who are receiving income more than the personal allowance rates, so not the poorest people anyway.

I can't see why both parties are so blind about increasing the personal allowances. To me it's the easiest, fairest, way. Olly300, agree with you.

Jen
x

Perhaps because it would be effective, but wouldn't cater to particular interest groups like pensioners or those reliant on benefits of one kind or another.

Britain has always had a strong puritan streak inclined towards extravagant gestures to reward the worthy and punish others. If one happens to fall into a worthy group then it seems heaven and earth can be moved to help you, regardless of almost any objective measure of need.

Otherwise, you're screwed.

Your idea would take out all the fun and righteousness.

Walter_J

olly300 wrote: »

They would do far better for everyone by raising the personal allowance level and then taxing people more above that level in a more progressive way.

I've been saying this for twenty odd years.

It's so bloody obvious!

Raise the income tax threshold to something meaningful like £15k taking half the country out of the system altogther. The shortfall in tax yield could be made up in progressively higher rates of tax for those earning over the threshold.

The average person would be no worse or better off, poorer paid workers and pensioners would benefit, and the better off would pay a bit more.

The unemployed would be motivated to find a job, particularly if coupled with a reduction in benefits.

arcalis

Sapphire wrote: »

True

It's about time savers, including pensioners, were helped by a government, though anyone who has savings of, say, more than about £200,000 could perhaps pay more.


why should they pay more? savings should not be taxed at all.

Savings aren't taxed, the income earned through interest is!

Whilst we're at it why don't we increase the threshold of inheritance tax to say £1 million, just to give those better off a little helping hand!!!!!!!!

cocktail

arcalis wrote: »

Savings aren't taxed, the income earned through interest is!

Whilst we're at it why don't we increase the threshold of inheritance tax to say £1 million, just to give those better off a little helping hand!!!!!!!![/quote]

sorry thats what i meant. the interest earned on savings should not be taxed. it is corroded by inflation anyway.

epz_2

IMHO the best thing the torrys could do would be to say they plan to keep on raising the minimum threshold before people start to pay tax.

it has many advantages,

1) its very easy to understand
2) as the 20p tax row showed most people are pretty fair and recon the poorest should pay less tax
3) less work for the inland revenue means less balls ups like tax credits and will need less administration (so you can sack some tax collectors)
4) it removes a lot of the incentive to stay in the black (non tax paying) economy
5) its less vulnerable to abuse and tax avoidance issues
6) keeping more of the money people earn incentives them to get off benefits and lowers the employers cost so they can employ more people

bo_drinker

In most cases savings have been hard earned and there fore taxed. It should stop there but it doesn't. Say you take out some hard earned to buy something, you are taxed on it and even before you go to the shop to buy it. Get out of bed turn on the light (taxed) run water (taxed) etc etc etc. You are even taxed while you sleep. No matter who is running the country it won't change, 2 certainties, death and taxes.

michaels

I agree that the inflation gain from saving interest should not be taxed but can't see why any savings income above an inflation adjustment should not be taxed like any other income.

islandannie

And who exactly funds this proposition?

Sapphire

cocktail wrote: »

Sapphire wrote: »

Nonsense. I have some savings and so do my siblings, yet we certainly don't consider ourselves 'rich'. Those savings – built up over years of hard work as security for ourselves – are actually in jeopardy because of other people's greed, etc (don't get me started on that one).
True

It's about time savers, including pensioners, were helped by a government, though anyone who has savings of, say, more than about £200,000 could perhaps pay more.


why should they pay more? savings should not be taxed at all.

I agree to a certain extent, but those who have substantial savings could perhaps have higher taxes (they can afford it) in order that those who have less can have more? The wealthy have paid far too little tax in recent times especially – this is not right. :cool:

islandannie

Sapphire wrote: »

cocktail wrote: »

I agree to a certain extent, but those who have substantial savings could perhaps have higher taxes (they can afford it) in order that those who have less can have more? The wealthy have paid far too little tax in recent times especially – this is not right. :cool:

without savers there can be no borrowers.

Pretty basic economics.

Penalise me and you have no access to funds.