Labours five point plan.

Wookster

Graham_Devon wrote: »

What do people think?

I saw him on the C4 news, where he proudly stated that he hadn't done any budget to see what the benefits of his proposals are.

He didn't seem to see any problem with spending money without a cost/ benefit analysis or a budget. This is basic stuff for anyone in finance. The three questions are:

1. What does it cost?
2. What are the benefits/ is it worth it?

This is the problem with id1ots like Ed Balls.

They don't think things through.

Graham_Devon

leveller2911 wrote: »

Speaking as someone who is vat registered I can say that many of my customers have either : Put work on hold due to having to pay 20% vat or asking me "is there anything we can do about the vat?"......

Obviously I say I can't do anything about the vat but many ask the same question over and over again so I think it may matter more than you think, just think about it £1,000 for a couple of wooden windows(hardly a luxury) and then £200 to the government....I think the vat rate of 20% is a burden many cannot afford to pay.

They are asking whether you will do it for cash.

Has always happened.

antrobus

Wookster wrote: »

....

This is the problem with id1ots like Ed Balls.

They don't think things through.

Ah yes Ed Balls, the man who was once Gordon Brown's chief economic adviser .... he didn't really think things through that time either.

A._Badger

Wookster wrote: »

This is the problem with id1ots like Ed Balls.

They don't think things through.

You're right but it's more than that. Neither Brown nor Balls (nor most politicians from any of the parties) have anything but the briefest experience of business before entering politics. They go straight from idiotic student politics to... idiotic student politics.

IveSeenTheLight

Graham_Devon wrote: »

Not sure on the immediate VAT cut on home improvements though. Firstly I'm not sure it can be immediate, legally. Secondly, not sure what that's supposed to achieve really. Any thoughts?

It's trying to beef up local trades persons.
I might want to improve my home by putting in some decking.

It can be quite expensive, depending on the quality you go for
http://www.timbertechuk.co.uk/

It's quite plausible that you could spend £5k + vat on said decking (or indeed any other home improvements) and instead of paying 20%, you only pay 5%

This example you would save £750.

kabayiri

CLAPTON wrote: »

surely a man of your calibre would negotiate at least £50 whatever the VAT rate.....

Clearly, in this case I didn't read the 'exam question'! I saw it as a 5% VAT reduction, not 5% rate. duh.

Having spent far too much money on house projects recently, what I do like about it is that it circulates money into the local economy. Getting local economies to function again as communities is crucial in my view.

I'd rather this than increase the numbers of cheap Korean cars imported.

kabayiri

leveller2911 wrote: »

My point was that many products that are vat rated at 20% are not luxury items,for instance maintaining a house isn't luxury ,its a necessity.
....

You could make the same case for maintaining a car though, which is a necessity for work travel to many.

JasonLVC

Graham_Devon wrote: »

What do people think?

In a nutshell:

I'm not sure how we guarentee jobs. I know labour did this before, but we never heard much more than they were going to do it. How did it go? What job can you guarantee? Is it more to do with bringing forward spending? Which means more debt?

VAT cut I suppose is plausable. I.e. can be done.

Not sure on the immediate VAT cut on home improvements though. Firstly I'm not sure it can be immediate, legally. Secondly, not sure what that's supposed to achieve really. Any thoughts?

People cannot / will not spend while they are in debt at these times. It seems to me, most of the above is based on spending money the government and the nation don't have. He talks about people struggling to pay bills in the speech and then suggests VAT cuts on items such as double glazing (home improvements). Either he wants to talk about people simply struggling to pay the bills, or he believes people will have enough money to think "oh, VAT has fallen, I'll get some tripple glazing now". Can't be both.

http://www.bbc.co.uk/news/uk-politics-15054705

The VAT cut is the same cut Balls has been going on about for over a year now. When Darling cut the VAT rate by 2.5% from 17.5% to 15% for one year it cost the treasury around £14billion. It then went back upto 17.5%.

Osbourne then raised it 2.5% from 17.5% to 20% so even in simple maths terms, that should generate an additional £14billion income for the Treasury (appreciate recessions = less spending thus not necessarily £14b will be made, I did say 'simple maths').

The 5% VAT temp VAT rate was passed in EU legislation back in 2008/09 but UK chose not to adopt the option, many other countries did.

The 5% rate can be applied to domestic repairs (new patios, double glazing, plumbing) and also to restaurants (but not drinks), shoe repairs and hair dressing(!). Osbourne could do this tomorrow as the law permits it.

There would be a cost to the Treasury, the gamble would be that lowering the VAT on these things would stimulate these trades and get people spending, thus you lose 15% of VAT but see small traders triple their turnover.

The risk is that the VAT cut to 15% didn't actually stimulate the market and didn't get people out buying TV's and stuff (people were losing jobs, banks not lending, etc), so if VAT did drop to 5% it could cost a lot of money and not be balanced by receipts as people are still losing jobs, banks stil aren't lending , etc.

kataklysm

From what I can make out, Labour have admitted that:
- They didn't spend our money wisely
- They didn't regulate the banks
- They undercut British workers by not controlling immigration, and,
- Given the chance, they wouldn't actually be able to do anything about the Coalition's cuts. Because they made a total and complete pig's ear of our country's finances.

But somehow, a tenner off a kitchen will save us all.

Except: you can't afford a new kitchen, or a house for that matter, because you don't have a job, never will and neither will your children. Hooray!


Note:
I hear Ed Ball's children are taking Yvette's surname - presumably to save them the embarrassment of people knowing who their father is... Mortifying I'm sure.

Thrugelmir

JasonLVC wrote: »

The 5% rate can be applied to domestic repairs (new patios, double glazing, plumbing) and also to restaurants (but not drinks), shoe repairs and hair dressing(!). Osbourne could do this tomorrow as the law permits it.

Would this be a stimulus to the economy?

PS. Overrun with overpriced restaurants in this country. So a cull wouldn't go amiss....