Cameron makes savings tax pledge

nickmason

Rochdale_Pioneers wrote: »

Yup, its a battle of intellect.

One one side you have the Labour Party. The IMF. The World bank. The EU. The CBI. Nobel-laureate economists. Most of the developed world's governments. Even the Germans, despite their comments before Christmas, have spent more bailing out their banks than we have, and have pledged to invest more of GDP than we have on propping up their economy.

On the other side you have Cameron and Osborne. Oh, and Redwood, with his "lets fully deregulate the mortgage market" idea.

I know enough civil servants to know that my suggestion that economic arguments are squashed by political imperatives is entirely true. Sorry I can't go any further than that. They - the civil servants - will likely end up arrested if I reveal any further.

Frankly - given your litany of support - can you be a bit more specific, rather than saying "everyone's backing Gordon"? Because I can find criticism from each of those groups.

Rochdale_Pioneers

overlander wrote: »

But the rest of the world have no where near as much debt as we have, the days of spend spend are over and I for one will be glad to see the back of it.

The facts disagree. We entered this recession with substantially less debt than most of our competitors even when you factored in PFI etc. In some cases (the US and Japan especially) their debt levels were double and triple our own.

So where do our debts stand now? According to Eurostat we exited 2007 with 44.2% gross debt (% of GDP). Germany had 65.7% - thats 49% more than us. We've had to spend heavily - £37bn so far on bank bailouts, and we've spent about 1.5% of GDP on the VAT reduction and other liquidity injections. Germany has spent 50bn Euros on Banks and 2% of GDP on liquidity.

So, a country that enters the recession with half as much debt again than us who spends more than us - and you still think we have more debt than they do? I hear a few red herrings bandied around - the Northern Rock liabilities (add all foreign bank liabilities onto their totals too then), PFI (included in Eurostat's figures which is why they are substantially higher than our own), pension deficits (linked to stock markets which have crashed everywhere, so add those onto everyone else too) and personal debt - which doesn't affect government borrowing at all, and once again needs to be added elsewhere.

Our debt is going to be substantially higher than we've seen before - even higher than the 51% seen in the last recession (yes folks, when Labour "didn't put money aside for a rainy day" it actually reduced debt from the 49.8% it inherited all the way down to 37.5% in 2002). But higher than everyone else? Unsustainable? Unmanageable? So how does everyone else manage?

We'll all exit this one up to our eyeballs in debt, all loaned to each other. This recession is global and its effects are global. We went in with substantially less government debt than most of our competitors and with everyone spending borrowed money like its going out of business we'll exit with substantially less government debt than everyone else. Yes, if we were burning money on our own then we'd be in trouble. But all burning together?

casper_uk

Masomnia wrote: »

People with ~£1million in savings are not those we should be focusing on.

Do people with 1 million+ pay the basic rate of tax, i don't think they do somehow! The very rich don't pay tax anyway as they employ people to find loopholes and in some cases don't even leave the money in the UK!

overlander

I do not think you can exclude personnel debt as Browns solution is for us to take on more his whole economic miracle is based on personnel debt so you cannot exclude it. We have the highest personal debt in the world and Brown wants us to take on more. If you also include the private initiatives that the government have it makes shocking reading our true debt. You have to include this as we pay massive amounts in rent so its an expenditure you cannot just hide it under the carpet. I have a good article in the house where the true extent of the UK debt time bomb was worked out and it made shocking reading. Will post it as soon as i get home.

edgex

cogito wrote: »

Tax should not be payable on interest earned on savings out of income which has already been taxed. End of.

here here

dont forget, its not just savings accounts where the interest is taxed, but also current accounts, so it would also be a positive impact on the low-earners, people who might not have savings accounts.
it might only be 10p a year, but who would you rather have that 10p?

much better than the vat cut, which has had zero effect.


how much does it cost to collect 10p in tax off someones account?
more than 10p!


stupid person of the day goes to:

But Carl Emerson, deputy director of the Institute of Fiscal Studies, said it was unclear whether the recipients would choose to spend the money or save it and there was a chance that it would result in less money flowing into the economy.

banks are part of the economy stupid! :rolleyes:

Masomnia

casper_uk wrote: »

Do people with 1 million+ pay the basic rate of tax, i don't think they do somehow! The very rich don't pay tax anyway as they employ people to find loopholes and in some cases don't even leave the money in the UK!

Very good point, you're quite right I neglected that point about it just applying to baic tax payers.

I wonder how much income Cameron generates on his savings, and how much tax he pays? Him being worth £30m and all. It's easy to tell the rest of us to stop being materialistic when you're lucky enough to find yourself in that position.

nickmason

Masomnia wrote: »

Very good point, you're quite right I neglected that point about it just applying to baic tax payers.

I wonder how much income Cameron generates on his savings, and how much tax he pays? Him being worth £30m and all. It's easy to tell the rest of us to stop being materialistic when you're lucky enough to find yourself in that position.

Is he really? I know his wife's family is very wealthy...didn't realise he was as well.

Masomnia

nickmason wrote: »

Is he really? I know his wife's family is very wealthy...didn't realise he was as well.

Now that you mention it I think the £30m may be their combined wealth, it's a while since I read it I'll admit. I'll have a root around.

WTF?_2

huntersc wrote: »

What's the real saving here? 20% tax on 0%? Very generous

At the moment rates are low ... but rates are going to rocket in the next few years so this measure would benefit lots of savers. The popularity of ISAs shows there is a real demand for tax free saving.

Plus, this is a good time to make the cut as it won't result in much in the way of immediate additional losses to the government.

WTF?_2

Masomnia wrote: »

Very good point, you're quite right I neglected that point about it just applying to baic tax payers.

I wonder how much income Cameron generates on his savings, and how much tax he pays? Him being worth £30m and all. It's easy to tell the rest of us to stop being materialistic when you're lucky enough to find yourself in that position.

What does his personal wealth have to do with his ability to work effectively as a political leader?