2% Drop in Income tax (all a con) and NI

MarkyMarkD

I think that, for people on higher rate tax, the NI change and the alignment of the higher rate tax threshold cancel out, as the lower rate tax saving is around £38k@2% = £760, higher rate tax saving is around £5k @ 20% = £1k, whilst the NI increase is around 11% on £4,300 = £500 ish. So the net impact is around £250. (All numbers very rough).

It's misleading to compare figures between years, though, because of inflation and so forth.

Geoffo_M

krisskross wrote: »

I am a pensioner with total gross income of approx £11K. The majority from an occupational pension. I shall be paying an extra £100 a year at least in addition to the £1100 tax I already pay. I fear the council tax bill so much.

What on earth is a Labour chancellor doing taxing pensioners to such a degree? I wish I had never paid into a pension scheme or saved a penny during my working life. I would actually be better off.

I sympathise as I am in a similar position. In fact, all low earners up to around £16k will be worse off. Labour used to stand up for the low earners, but I think Brown is trying to get back some of middle england who he has bombarded for years. What worries me is what is in the small print and will be discovered in the next few days. You know what a devious baa-lamb he is. What's the betting everyone will end up worse off?

Geoffo_M

moonrakerz wrote: »

His aim to make more and more people dependent on state handouts, tax credits, etc, etc, etc.
Why ? so that those people then HAVE to vote Labour to try and maintain any standard of living..

Spot on. That has been the plan for years. One in four men and one in three woman now work for the state directly or indirectly. That's mighty high!

gingerdad

READ MR. BELL'S SPEECH IN FULL

Key elements of the Budget, now being debated in Tynwald, include:

- Income tax personal allowances increased by 2.1 per cent to £8,850 for single people and £17,700 married couple one working.

- Personal income tax standard rate remains at 10 per cent, with the high rate at 18 per cent.

- Personal allowance credit band remains at £2,500 for people who do not fully utilise personal allowances, with maximum credit incrased 20 per cent to £420.

- The tax cap on total income tax payable per person remains at £100,000.

- A 3.1 per cent (£16.3m) increase in government revenue spending on public services.

- Additional funding for fuel efficiency in public sector housing.

- Corporate charge to remain at £250 per company, but to be collected as part of the increased company annual return fee.

Taken from iomonline.co.im..........but a much better budget than GB.......................dam why did i move back

Jet

Optimist wrote: »

He is targeting this group with working tax credits. It makes the poor more dependent on claiming. Stinks but 2p income tax cut looks good when it comes to spin!

Yes, but most people on a low income will already be claiming working tax credit which is only going to rise with inflation (correct me if I'm wrong here), so anyone on a low income already claiming working tax credit is going to be worse off because they're tax credits will rise in line with inflation but they will pay more income tax.:mad:

exil

The threshold (where tax credits start to taper off) is increasing by 1200 in 2008 which will give most people on tax credits an extra 500 or so, in addition to any actual increase in the tax credit amounts.

For this reason the main losers in this budget are young people who cannot claim tax credit and are on under 15k a year. Pensioners will be compensated for the loss of the 10% band with increased age allowances - and may be able to benefit from the 10% band on savings.

shavenlunatic

Tirian wrote: »

I've done up a nice little graph to show how much better or worse off you will be under the new income tax regime, according to your income. I haven't included over £35,000 which is where the upper tax threshold, cause frankly if you earn that much then you can bloody well ask your accountant to work it out for you

lol, so if i'm on 18,200 I guess i have no change... wheres my payrise???

General_Mayhem

FWIIW, I have added tax credits for a single person, working over 30hrs pw to the calc:



As you can see it really is swinging in favor of certain key (voting) demographics...

exil

That's what's so odd. The people who lose out are in the main young people who already are hit by student loan debt, and will in the next few decades have to pay increased tax to support the growing number of oldies such as myself as well as saving money for their own pensions.

Tirian

exil wrote: »

That's what's so odd. The people who lose out are in the main young people who already are hit by student loan debt, and will in the next few decades have to pay increased tax to support the growing number of oldies such as myself as well as saving money for their own pensions.

Quite. And we'll be pretty stuffed if we can't afford to save into a pension, because there sure as hell isn't any prospect for most of us of being able to afford to buy a house.