Pre-Budget Report - LIVE

Graham_Devon

JasonLVC wrote: »

Not sure if I'm understanding this correctly.

The 0.5% NI increase in 2011...I think there was already a 0.5% increase to NI in last years PBR and I think this 0.5% annunced today is ON TOP of the previously announced 0.5%.

So I think that means from April 2011, earners over £20k will be paying 1% NI.

Trust the government to make a 1% tax hike look like a 0.5% tax hike and then delay it for 2 yars so that it means absolutely nthing until the next government takes over......

The beeb picked up on this in their news report, but are still using the 0.5% in the big red letters on the screen.

So yes, it will be a 1% rise.

Edit: Also no mention of a reduction in fuel duty of 2p when VAT goes back up. They promised at the time this was just to cover the fall in VAT on fuel. But we are only 20 days away from VAT returning to 17.5%, and a pre-budget report has no mention of this.

I would have thought Capital Gains would have been mentioned as an obvious way to create further revenue. Bu bizzarely, thats been left.

JasonLVC

Graham_Devon wrote: »

Edit: Also no mention of a reduction in fuel duty of 2p when VAT goes back up. They promised at the time this was just to cover the fall in VAT on fuel. But we are only 20 days away from VAT returning to 17.5%, and a pre-budget report has no mention of this.

I would have thought Capital Gains would have been mentioned as an obvious way to create further revenue. Bu bizzarely, thats been left.

Yes, cannot see anything about fuel duty on the Treasury website or documents.

They do mention a LandLine Duty of 50p per month from October 2010...so instead of BT investing their own share holders money in infrastructure, taxpayers have got to pay for it all and then pay to use that very same infrastructure from BT....might as well nationalise BT.

As for CGT - Darling seems to have left everything 'as is', so no tax hikes and no spending cuts until 2011-2013....by which time we'll already be doomed.:D

Graham_Devon

JasonLVC wrote: »

Yes, cannot see anything about fuel duty on the Treasury website or documents.

They do mention a LandLine Duty of 50p per month from October 2010...so instead of BT investing their own share holders money in infrastructure, taxpayers have got to pay for it all and then pay to use that very same infrastructure from BT....might as well nationalise BT.

As for CGT - Darling seems to have left everything 'as is', so no tax hikes and no spending cuts until 2011-2013....by which time we'll already be doomed.:D

Seems that way.

Apparently this will bring in 10bn over the year (taken from comments on a newspaper stie, so how accurate I'm not sure, but they seemed to have covered everything quite well!!).

Trouble is, welfare costs £160bn a year roughly. Taking the 1.5% and 2.5% increases in this area, and averaging 2%, this very roughly translates to £3.2bn extra spend.

Once all the extra spends are included, I wonder how much has actually been spent of that £10bn.

More of a pre election speech than a pre-budget report, as I bet the actual budget bares little resemblance to todays witterings.

nickmason

Regarding the "bingo duty"...(my curiosity was piqued, so I dug around)

Most gambling related industry faces a levy of 15%. In the Budget the levy on bingo halls was raised to 22%. It's noteworthy that this wasn't trumpeted, and indeed the HMRC website still shows it at 15%. Anyhow mecca or rank or one of the big players did notice, and orchestrated a serious lobby of MPs (prepaid envelopes etc). Apparently bingo halls are particularly prevalent in strong labour seats.

So with a great hullaballoo, it's been dropped back down to 20%, and reported as a tax cut. The total taxable value of the industry is I think £500M, so the tax cut will cost in the region of £10M. Not the largest of issues...

nickmason

Meanwhile the national debt continues to increase at £5000/second. Or £500M a day.
Put another way - the bankers bonus tax (even if it does raise the money predicted, rather than clever bankers using clever accountants to avoid paying tax, which of course would be unprecedented) - will pay off one day's overspend.

For every £4 the government spends, it's borrowing £1 - ie it's overspending by about 33%.

nickmason

Another nice illustration of how these numbers are becoming so big that nobody really gets it: each child is being born into a share of national debt of about £23k. Which makes the £250 child trust fund really quite banal.

JasonLVC

nickmason wrote: »

Regarding the "bingo duty"...(my curiosity was piqued, so I dug around)

Most gambling related industry faces a levy of 15%. In the Budget the levy on bingo halls was raised to 22%. It's noteworthy that this wasn't trumpeted, and indeed the HMRC website still shows it at 15%. Anyhow mecca or rank or one of the big players did notice, and orchestrated a serious lobby of MPs (prepaid envelopes etc). Apparently bingo halls are particularly prevalent in strong labour seats.

So with a great hullaballoo, it's been dropped back down to 20%, and reported as a tax cut. The total taxable value of the industry is I think £500M, so the tax cut will cost in the region of £10M. Not the largest of issues...

Bingo Halls are in traditional 'working class/labour' heartlands but the bingo duty increase was massive and straight on the back of the smoking ban as well and so the bingo halls had a double hit (not including the hit on alcohol and fag duty which also went up as well at the time).

At a time when the Treasury needs every penny, it seems odd that the Bingo Hall duty was dropped back down so quickly, those bingo halls that couldn;t survive have already died so reducing it doesn't help them and the remaining bingo halls just have to do what everyone else is doing.....cut costs and reign in spending.

sgh1976

JasonLVC wrote: »

This public setor pay freeze/cap of 1%.....hoe come the bankers get a 50% tax rate with immiediate effect but the public sector workers can continue to award themsevles pay increases (albeit capped) plus uncapped bonus' until 2011?

How does that save the government billions now?. I thought the recent Brown announcements was about cutting public sector spending and yet they're delaying thoe savings when we need those savings now.

Its because the payrise in April 2010 was agreed nearly 3 years ago. The Unions wanted a big payrise , so the Government did a deal and split the rise over 3 years. So if they stop that agreement now it will cause them all sorts of problems as what action do you think the Unions will take and does the Government need the public sector walking out on the run up to an election?

Another thing to keep your eye on is the cancellation if IT based projects in the NHS. There is going to be all kinds of the smelly stuff flying around on this one. The projects that are under way and will be stopped have all been signed up to contracts with Private Secotr companies. So the Government are seemingly planning on walking away from those contracts. I'm sure the company's will sit back and let that happen.

JasonLVC

sgh1976 wrote: »

Its because the payrise in April 2010 was agreed nearly 3 years ago. The Unions wanted a big payrise , so the Government did a deal and split the rise over 3 years. So if they stop that agreement now it will cause them all sorts of problems as what action do you think the Unions will take and does the Government need the public sector walking out on the run up to an election?

Another thing to keep your eye on is the cancellation if IT based projects in the NHS. There is going to be all kinds of the smelly stuff flying around on this one. The projects that are under way and will be stopped have all been signed up to contracts with Private Secotr companies. So the Government are seemingly planning on walking away from those contracts. I'm sure the company's will sit back and let that happen.

I knew there was a previously agreed pay rise but that was then, this is now.

If Darling can introduce a 'panic' tax on bankers then he can introduce a panic cut on public sector workers. The Irish government have just done this, many private sector employees are seeing less hours or pay cuts being foistered upon them and yet public sector workers get a guaranteed 1.5% payrise this year at a time when the government have said they are seeking to cut costs.

Its all academic anyway as Darling is just passing the problem onto someone else in the future and even if they did give public sector staff pay cuts, they'd make it up with giving them bonus's for soing their jobs badly like this weeks Border Agency staff, the MOD staff the other week, etc. Avoid a pay rise by giving people bonus' instead seems to be the gameplan.

JasonLVC

sgh1976 wrote: »

Another thing to keep your eye on is the cancellation if IT based projects in the NHS. There is going to be all kinds of the smelly stuff flying around on this one. The projects that are under way and will be stopped have all been signed up to contracts with Private Secotr companies. So the Government are seemingly planning on walking away from those contracts. I'm sure the company's will sit back and let that happen.

To be honest, it'd be worth paying £50m penalties to gete away from these (usually American owned) IT consultants. EDS are a shamble of shysters, Crapita says it all and I can;t remember who the NHS contract is by but weren;t one of the lead companies involved in a big scandal a few years back as well in terms of over-pricing quotes, etc.