Pension changes under the Labour/SNP govt?

hyubh

zagfles wrote: »

I can't see how the above has anything to do with the post of mine you quoted.

What on earth was your line 'as that would impact those with public sector DB schemes' supposed to mean then?

kidmugsy

zagfles wrote: »

It wouldn't be fair to expose people to CGT just because they move house... and so get double hit through no fault of their own.

It's a tax: fairness and fault have nothing to do with it. The point is that it would be hard to avoid, and that the sort of people who would have to pay wouldn't riot.

EdSwippet

kidmugsy wrote: »

It's a tax: fairness and fault have nothing to do with it. The point is that it would be hard to avoid, and that the sort of people who would have to pay wouldn't riot.

Now I can't tell if you're being serious or not. It's simple to avoid -- don't move house.

Transfer taxes have a major dampening effect on house moves. A report by the LSE shows a 40% reduction in local mobility from a 2% increase in stamp duty. The rate from CGT, even allowing for some vague and unlikely-to-materialize inflation uplift, will be vastly higher than that 2%.

zagfles

hyubh wrote: »

What on earth was your line 'as that would impact those with public sector DB schemes' supposed to mean then?

Because with DB schemes, even for someone on average pay who has a few decades of service, a payrise could result in them blowing the annual allowance. Particularly if it's reduced to £30k. So I don't think a Labour govt would abolish the carry forwards of the AA. Nothing whatsoever to do with whether Labour or the Tories are better for public sector schemes.

zagfles

kidmugsy wrote: »

It's a tax: fairness and fault have nothing to do with it. The point is that it would be hard to avoid, and that the sort of people who would have to pay wouldn't riot.

No but they might use their vote...

hyubh

zagfles wrote: »

Because with DB schemes, even for someone on average pay who has a few decades of service, a payrise could result in them blowing the annual allowance. Particularly if it's reduced to £30k. So I don't think a Labour govt would abolish the carry forwards of the AA.

I am still flummoxed at that inference. Why do you think a Labour government specifically would take special care not to tweak AA rules in such a way that those in 'public sector DB schemes' in particular would lose out? That said, the effect of pay rises will progressively diminish given the CARE structures for future accrual now in place.

Nothing whatsoever to do with whether Labour or the Tories are better for public sectore schemes.

Increasing taxation on large DB pensions would surely be a good thing for the unfunded public sector schemes (TPS, NHS, PCSPS, etc.), would it not? Assuming we mean the same thing by 'good for public sector schemes', which I'm not sure we do. Also, I exclude the LGPS from this obviously, though that one has comparatively few high earners anyhow.

brewerdave

What Labour Government ??:rotfl:

zagfles

hyubh wrote: »

I am still flummoxed at that inference. Why do you think a Labour government specifically would take special care not to tweak AA rules in such a way that those in 'public sector DB schemes' in particular would lose out? That said, the effect of pay rises will progressively diminish given the CARE structures for future accrual now in place.

Why are you making such a big deal out of this? We're obviously not going to get a Labour govt now, but I don't think any govt would stop the AA carry forwards, it makes no sense to, it would create anomilies particularly in DB schemes as I said, and it wouldn't reduce the amount people could contribute in total.

Increasing taxation on large DB pensions would surely be a good thing for the unfunded public sector schemes (TPS, NHS, PCSPS, etc.), would it not?

Not if people on average pay are hit with a massive tax bill for getting a payrise. Pensions are a lifetime benefit, it makes no sense to disproptionally tax them because benefits accrue in spikes.

kidmugsy

We're not going to get a Labour government, but the public finances are still in a pretty ropey state. Not that the public seems too aware of it; or if it is, it doesn't seem much to care.

What we need is some faster growth, which won't be easy while one of our biggest customers, the Eurozone, is in the soup.