General Election 2015 – Tax Implications?

jjlandlord

antrobus wrote: »

Technically, 'what parliament intended' does come into it. The courts will look at parliamentary intention when attempting to decide what a particular piece of legislation means, but that intention will be derived from the text of the legislation, and nothing else.

That's the thing.
All is fine and legal as long as one acts within what the law actually says, whatever politicians or MPs will claim they actually intended.

Especially since, as we all know, they will claim whatever suits them at any given time.

michaels

I guess we are going to hear a bit more about the pensions raid at lunchtime today:
http://www.bbc.co.uk/news/education-31640592

I guess the 'hilarious' thing is that under the current system that is a graduate tax in all but name, cutting fees will only benefit high earners who are scheduled to pay off their entire loans before they are written off at age 50. Taking from pensioners to give to high earners, can't get much more progressive than that, Labour supporters will love it.

Loughton_Monkey

michaels wrote: »

I guess we are going to hear a bit more about the pensions raid at lunchtime today:
http://www.bbc.co.uk/news/education-31640592

I guess the 'hilarious' thing is that under the current system that is a graduate tax in all but name, cutting fees will only benefit high earners who are scheduled to pay off their entire loans before they are written off at age 50. Taking from pensioners to give to high earners, can't get much more progressive than that, Labour supporters will love it.

I'm no fan of Peston, but I like this one:

Peston: As for limiting tax relief on saving, it could potentially raise billions if it was targeted on all 40% rate earners. But it would be quite a brave Labour Party leader who announced a thinly disguised tax rise for the more than four million households in this tax bracket. And neither Ed Balls or Ed Miliband would presumably wish to sign what some would see as a general election suicide pact.

As for the tuition fee cut itself, I naturally would say it's wrong, wrong, wrong, but only because it comes from two of the biggest clowns in the universe (Miliband & Balls). But in this instance, a third clown (Vince Cable) is saying do not cut them. Since all of these three clowns are always wrong, there can only be one 'correct' answer: And that is to put tuition fees up.

Moby

I think it will prove popular and that is what the right wing Daily Fail types fear.:beer:. Talking about clowns ol' ham face Cameron didn't do to well at Question time yesterday did he. The phrase 'trying to nail jelly to a wall' came to mind seeing him desperately avoiding giving a straight answer.

michaels

Moby wrote: »

I think it will prove popular and that is what the right wing Daily Fail types fear.:beer:. Talking about clowns ol' ham face Cameron didn't do to well at Question time yesterday did he. The phrase 'trying to nail jelly to a wall' came to mind seeing him desperately avoiding giving a straight answer.

Popular for sure, Labour wouldn't be announcing if it hadn't passed muster in their focus groups.

However I don't see why ordinary pension savers (including lots of public servants with final salary pension schemes) should pay more tax so that the top 50% of graduate earners can pay less for their degrees whilst the lowest paid 50% of graduates still pay just as much?

Wouldn't it make more sense to help lower paid graduates rather than higher paid ones if you want to be 'fairer'?

Moby

The amount that the higher 50% students pay is too much and the lower 50% of students already receive help or don't pay the fees. Besides I've never understood why people who earn more are entitled to a higher rate of tax relief on their pensions. A flat rate has to be right! It's a moderate policy designed to close the gap between the generations....as against Camerons cynical ploy to cosy up to the grey vote by refusing to end winter fuel allowances for richer pensioners who frankly don't need the allowance.

michaels

So currently graduates who earn more pay more (progressive) whereas it is preferable that all graduates pay the same (regressive)? Sounds more like a Tory policy than a Labour one.

Tax is payable on receipt of pension so it would seem more like it is deferred than avoided. If money paid into a pension has already been taxed for higher rate taxpayers should it not be tax free on receipt?

Moby

Whether it's progressive or regressive is immaterial to the fact that the fees are slashed to 6K! How can anyone complain about that!

Of course tax is deferred....unless like me you can live on 10,500 a year and the rest from ISA's. The general point is we live in hard times and the better off should shoulder more of the burden. Reducing their tax relief to 20% is a contribution they should welcome for a better society.;)

michaels

Moby wrote: »

Whether it's progressive or regressive is immaterial to the fact that the fees are slashed to 6K! How can anyone complain about that!
Certainly not anyone who believes in magic money trees.

Of course tax relief is deferred....unless like me you can live on 10,500 a year and the rest from ISA's. The general point is we live in hard times and the better off should shoulder more of the burden.

Except if they are better off graduates in which case they should only shoulder as much of the burden as less well ff graduates?

Reducing their tax relief to 20% is a contribution they should welcome for a better society.;)

IN that case wouldn't it make sense to increase the income tax rate they pay than to tax their income twice, once now and then again when they get their pension? Or is the best solution the one that is most popular in focus groups rather than the one that makes most sense.

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Moby

I always get perplexed by the 'magic money tree' line. It's back to Thatchers kitchen sink economics, you don't spend what you don't have, live within your means mantra. The fact is the world is more complicated than that and likening personal budgeting to macro economics is a metaphor too far as far as I'm concerned.

Concentrating on the simple mantra that we should live within our means while ignoring the prevalent inequity all around us is disingenuous and ultimately a highly damaging distraction because all you are doing is storing up trouble for the future. I resent not having had a pay rise for five years, while doing an extremely difficult job. I also get taxed at source through PAYE. Therefore no one in this sham of a Govmt will lecture me about 'magic money trees' when I see how these privileged Bullingdon types live.