A Taxing Question

[Deleted User]

May be getting slightly off the thread here - but any changes to the tax system would have to be done by a new government, unannounced, immediately after an election! I'm afraid that any political party that announced before polling day that they were going to put up taxes would not have a prayer - turkeys don't vote for Christmas and taxpayers will not vote for higher taxes even if it is "right" - I seem to recall that the Lib Dems tried it at the last or last but one election and got gubbed. I happen to believe it isn't right anyway.

Even though I am employed in the public sector, I believe that as a matter of principle, it should be up to me, not the state, to spend MY earnings. I suspect that if the Government went after tax evasion with the same gusto that they go after "benefit cheats" they could probably reduce the tax rate and still increase the tax take.

As a matter of principle, I do not buy "knocked off" goods or pirate CDs or DVDs from crooks - some people call them businessmen, but we all know what they are. I do not pay "cash" in exchange for a discount from tradesmen. Why should I encourage others not to pay tax, when I am paying them out of my after-tax income - they could probably "buy and sell me" but they defraud the taxman and by definition all of us. I might end up paying more, but I would rather encourage honest tradesmen than featherbed evasion.

I am near the tax threshold limit - to the extent that if I was to earn more by working overtime, it would be taxed at the higher rate - even although my employer has the unmitigated gall to offer a LOWER hourly rate for the overtime (answers on a postcard....) than for the "normal" hours. It is bad enough being away from my home for even more hours without being taxed on the extra pay to the extent that I would only be paid for 36 minutes out of each hour, let alone the National Insurance!! (I think - 40% of 60 mins = 24 mins?).

I inherited half of a small, one bedroomed, property when my parents died, and I pay tax on my share of the rent. (I won't be able to retire on my share, BTW!!). I have two kids and am trying to raise them to be honest and truthful - sometimes I feel like a mug!!

Tax on work is like tax on savings - it is a disincentive!

WR

deemy2004

Yeh, there would be no greater incentive for people to work than 0% tax............

The government could raise the £100 billion or so from indirect taxes....

Do_Gooder_2

IvanOpinion wrote:

Many moons ago I remember somebody saying that they should totally and utterly do away with the enire social security system. No more dole, housing benefit, child allowance, incapacity and even no more pension. This along with the massive cost of running the system would go into a large pot and be shared equally among everybody over the age of 18. Thereafter the only way of getting any additional money was to earn it. The tax system would then be used to balance the pot.

At first glance this idea is attractive but what about all the people who are employed administering the social security system. They would all be unemployed with far less spending money. This would have a knock on effect on the economy.

My criticism of the social security system is the inability of both the government and the private company (usually EDS) to develop and implement a working computer system that helps administer the payments. Get that sorted and a great deal of money and stress to benefit recipients would be saved.

deemy2004

Do_Gooder wrote:

At first glance this idea is attractive but what about all the people who are employed administering the social security system. They would all be unemployed with far less spending money. This would have a knock on effect on the economy.

They would all be employed in sectors of the economy that actually produce something thus would help Britains GDP growth and make us all richer.

fairenoughclough

deemy2004 wrote:

They would all be employed in sectors of the economy that actually produce something thus would help Britains GDP growth and make us all richer.

Super sentiment, but I wonder how many jobs there are these days in the manufacturing sector in the Uk and after that how many unfilled vacancies?

Anybody with access to this sort of information, I'd be grateful for a link.

deemy2004

fairenoughclough wrote:

Super sentiment, but I wonder how many jobs there are these days in the manufacturing sector in the Uk and after that how many unfilled vacancies?

Anybody with access to this sort of information, I'd be grateful for a link.

The vacancy rate in the hotel and restaurant sector is more than twice that of manufacturing. From stats that I have been able to glean the number of vacant jobs is 18,250 out of total vancancies of 652,300

Service industries are far more important to the UK than manufacuring, Britain has a big financial services trade surplus with the rest of the world which is the primary reason why the £ is not falling WITH the $....

Other non manufacturing industries are - oil, software services etc...

Most important is not the industry but the actual GDP growth... it was not so long ago that Britain was far behind Germany and Japan... now we are ahead in GDP and fast catching up with the French and Americans ....

Let others retain dieing industries that we dumped in the 80's that has allowed us to grow whilst Germany / Japan have more or less stagnated.

Do_Gooder_2

deemy2004 wrote:

The vacancy rate in the hotel and restaurant sector is more than twice that of manufacturing. From stats that I have been able to glean the number of vacant jobs is 18,250 out of total vancancies of 652,300

Service industries are far more important to the UK than manufacuring, Britain has a big financial services trade surplus with the rest of the world which is the primary reason why the £ is not falling WITH the $....

Other non manufacturing industries are - oil, software services etc...

Most important is not the industry but the actual GDP growth... it was not so long ago that Britain was far behind Germany and Japan... now we are ahead in GDP and fast catching up with the French and Americans ....

Let others retain dieing industries that we dumped in the 80's that has allowed us to grow whilst Germany / Japan have more or less stagnated.

As you have mentioned the 1980's your solution to 'high' taxes appears very similar to Friedman's Monetarist policies practised by Thatcher's government. Policies that appeared to work for some time but ultimately resulted in the 'Poll Tax' riots. Just making people redundant and then forcing them to fend for themselves (which essentially is the result of monetarist policies) has proved to be far too traumatic for populations to take. Especially in a democracy or would you advocate a Pinochet type government as in Chile that also practised Monetarism.

Incidently the hotel and restaurant sector is notoriously badly paid (accounting for its high vacancy rate) and the financial sector has had far too many recent financial scandals for this country to rely on.

deemy2004

Eh ?

Thatherism has worked - were reaping the benefits....

All new labour is, is a soft version of thatherism

The alternative is - 10% unemployment, record debt and a stagnating economy.... and no I'm not talking about soem third world economy, but rather Germany AND France...

The backbone of the socialist european model that you expouse...

If a worker is not productive then he has to go and re-skill himself to become productive. there is not logic in employing people who are non productive ... all it will do is kill the economy i.e. 70's Britain... Hopefully we never turn the clock back to those crazy socialist days....

Do_Gooder_2

deemy2004 wrote:

Eh ?

Thatherism has worked - were reaping the benefits....

All new labour is, is a soft version of thatherism

The alternative is - 10% unemployment, record debt and a stagnating economy.... and no I'm not talking about soem third world economy, but rather Germany AND France...

The backbone of the socialist european model that you expouse...

If a worker is not productive then he has to go and re-skill himself to become productive. there is not logic in employing people who are non productive ... all it will do is kill the economy i.e. 70's Britain... Hopefully we never turn the clock back to those crazy socialist days....

First time I have seen Chirac called a socialist. High unemployment, debt and stagnation can occur in non-socialist economies.

Unfortunately not all 'redundant' workers are able to reskill to the needs of a high skill economy. The problem is that those not capable of doing high skilled work (through no fault of their own) have had the low skilled work moved to countries such as India and China - high skilled jobs are moving there as well.

deemy2004

Do_Gooder wrote:

First time I have seen Chirac called a socialist. High unemployment, debt and stagnation can occur in non-socialist economies.

Unfortunately not all 'redundant' workers are able to reskill to the needs of a high skill economy. The problem is that those not capable of doing high skilled work (through no fault of their own) have had the low skilled work moved to countries such as India and China - high skilled jobs are moving there as well.

So what then ?

Do we have an uneconomically viable economy that gradually goes down the tubes ?

Its not a question of an alternative for there is none, to compete a country needs to be competitive or it will die... remember the soviet union and how un-competitive it was and what happened to all of the industry that went bust with unemployement approaching 40% ... There is no alternative to having a competitive workforce that has the necessary skills to do the work.