Deflation Revisited

Generali

mewbie wrote: »

A large amount of VAT is on non discretionary. Everyone thinks - oh I won't buy a CD or whatever !!!!!! from Tescos, but VAT is charged on gas bills, fuel, etc.

There is surely a limit, given the amount of taxation heading our way, where discretionary spending cuts give way to real cuts - turn down the heating, eat less, drive less, etc.

The bigger falls in taxation caused by falling discretionary spending would be in Corporation Tax and Income Tax from employees, although VAT would clearly be hit too.

mewbie_2

Generali wrote: »

The bigger falls in taxation caused by falling discretionary spending would be in Corporation Tax and Income Tax from employees, although VAT would clearly be hit too.

Don't forget N.I. Probably the favourite stealth tax. Hits everyone, yet no one seems to notice. It's not INCOME TAX therefore we won't botther about it.

Generali

mewbie wrote: »

Don't forget N.I. Probably the favourite stealth tax. Hits everyone, yet no one seems to notice. It's not INCOME TAX therefore we won't botther about it.

Half paid for by 'The Bosses' too so much beloved of Socialists everywhere.

sabretoothtigger

I agree with Jim. We fell off a cliff in price but also in taxes and that event occurred about a year ago upto March this year so as these negatives disappear off the average year on year figures we only have increasingly positive figures.

Unless we assume another cliff like fall will occur again then saying the current average wont rise is unrealistic.
They cant lower interest rates any lower, I hear Mr King is squirming to achieve something like negative rates but that isnt happening imo.

Already half the figures are pointing to a large rise, the other half in future are unlikely to repeat the past volatility.

The odds are in the favour of anyone predicting a rise, soon it will be 'no more bets please gentlemen'

jim83

Generali has made a good point and I agree I may have been overzealous in starting at the trough at the beginning of the year - in order for that to be valid next January's calculations should be seasonally adjusted. So after conservatively accounting for that, I am revising the projection for the next two quarters of CPI to 2.44%, 3.01% with an overall annualised rate of 3.5% instead of 4.3%.

Still a sharp increase and definitely not price deflation, but not as wild as I first thought.

What I have little doubt about is that the figures announced this month (Oct 13th) will be a bottom as far as the year-on-year price indices are concerned. Inflationary trend being followed will see it around 1.3ish.

geoffky

dopester wrote: »

Geoffk has a lot of wealth which could be redistributed. He surely doesn't need all that money slushing about. The awful hoarder.

Sir Humphrey needs to have new memories of holidays in the South of France and drinking fine wines, and why should he be denied when Geoffk has so much wealth to tap? Geoffks own fault for saving, wisely investing and not spending recklessly.

And slap a HPI windfall redistribution tax on everyone who owns their homes outright, including Max.

But i NEED it for my holidays....

sabretoothtigger

geoff there is nothing wrong with skegness

Thrugelmir

geoffky wrote: »

But i NEED it for my holidays....

Providing the money is spent in the UK.

sabretoothtigger

I think I heard them just saying on the ch4 news that inflation for this year is estimated 2 to 3% re: government pay freezes