Stamp Duty - The Tory's plan

michaels

Gorgeous_George wrote: »

What is Stamp Duty supposed to be for?
GG

My take on this is that generally taxes are charged when we earn (income tax) and when we spend (vat). The balance between the two reflecting the disincentive effect that the taxes have - income tax results in less return per hour worked so discourages work at the margin, consumption taxes make things more expensive so my encourage saving. Income from most is taxed in a similar way to income but personal dwellings are excluded from cgt so the income from their appreciation is instead taxed via stamp duty. Given that the number of properties is fixed (or limited to slow growth) those who have property tend to make real gains and it seems only fair that these are taxed to increase equality.

SquatNow

michaels wrote: »

Not sure about the Marxist conclusion

It's not Marxist. i beleive it's called Georgist. Winston Churchill liked the idea.

michaels wrote: »

wouldn't this discourage people from investing in this asset at the expense of any other (flash cars, plasma tvs, charlie)? Would that really improve society?

When the hell did a house become an investment? It's somewhere to live. besides, those that could make productive use of the land could pay the annual tax... don't forget, it would be the ONLY form of tax. No NI, PAYE, council tax etc. People would no longer simply be able to own land for the sake of it. Currently most land is owned simply in the hope that it will increase in value.

michaels wrote: »

Why would paying 25k cgt discourage someone from moving more than paying 25k stamp duty? Surely it is fairer to tax a proportion of a gain than to charge a transaction duty regardless of whether the asset has gained or fallen in value?

I'm not talking capital gains, I'm talking about taxing the owner of the property each and every year.

epz_2

the problem nobody seems to be talking about is that there seems to be a collaberation between all the big political parties that it is ok to tax the hell out of people to spend it on public sector wages.

i mean seriously have you seen what they get paid for obs that let them retire at 60 with final salary pensions and job security that means they are border line unsackable. i mean labour threw all that cash at the nhs and all that happened was it went on wages so people who were doing their jobs got their pay doubled.

i know a council monkey who left school without a single qualification earning more than lots of call center workers who have degrees and probably doing an simpler job.

and that is not even counting the mad somalian bludger who was on channel 4, she came here as a refugee, had 5 kids but never got a job yet hat the cheek to complain about only getting £32k a year of tax payer money.

frankly i am not a big fan of any tax which needs to be paid regardless of ability to pay but income tax has so many dodges that they need to prop it up some way.

there are lots of really right wing ways to solve the issues that cost us so much but few people have the balls to do them

RicoOS

CYBERCIDERSAVER wrote: »

But aren't the tories blaming Labour for the current credit crunch (which actually started in the USA) and high house prices are a factor in this???

So no stamp duty pushes prices even higher??!!!!

Surely it just makes it more likely people will use property as an investment keeping people in BTLs and meaning the "affordable" housing shortage will continue for a while longer before a larger "correction" than would otherwise be the case.

That's how I read it anyway

Partly the credit crunch started is the US, or more to the point, the fall out from irresponsible lending started in the US, the root cause of the whole credit crunch however goes back a lot further than that. Reaslistically, the cause is irresponsible policy from both the US government and the UK government after 9/11.

At the time, both governements (so yes this does fairly and squarely blame Gordon Brown) decided that they didn;t want any possiblity of an economic slow down, so they did 2 things, firstly was to lower interest rates to try and increase people's spending and boost the economy, and secondly they both continued with big governemtn spending booms, by borrowing vast sums of money themselves.

In reality this didn't prevent a slowdown, it merely delayed it. Econnomies go in cycles, and becuase the the very nature of people, no one has ever been able to stop this happening.

However when you artificially stimulate the economy in the way the government did, there is a big danger that although you delay the crunch point, when that crunch point does eventually happen, the crunch will be far worse, because the economy or market is further out of kilter to where it should be and therefore the correction is bigger.

So yes the banks are at least partly to blame for lending irresponsibly in both the US and UK, and yes, the consumer is also partly responsible due to not thinking for themselves and thinking that they can keep borrowing money without ever thinking "I'm going to have to pay this back at some point".

But mostly its down to the government lowering interest rates when they shouldn't have, and borrowing vast sums of money when, they should have let the market correct itself. It would have been far less painfull for all concerned in the long run.

Turnbull2000

epz wrote: »

the problem nobody seems to be talking about is that there seems to be a collaberation between all the big political parties that it is ok to tax the hell out of people to spend it on public sector wages.

Do a Google for "public sector pension liabilities" and you'll be staggered at the statistics. For better or worse (let's not argue about that), the public sector has grown immensely under Labour (nearly a third are state employed in the North East) and for these huge numbers to retire on final salary schemes 5 or so years earlier than private sector employees is quite simply unaffordable.

Many state owned or formerly state owned business models simply can not function without modernisation. The Royal Mail is an outstanding example of this. Unless working conditions change, efficiency improves and pensions are reformed, the whole system will likely collapse. The unions will have to accept this, otherwise the whole lot will face the dole queue - not just those targeted for redundancy. Their strikes are futile.

Gorgeous_George

Nurses wages did not double. Mrs GG is a nurse and I think we would have noticed. I think it's 1.9% this year.

The Royal Mail is fighting a battle with its hands tied behind its back. Mandated to provide a service in the non-profit making areas with the profitable areas opened up to competition. Companies can cherry pick the lucrative parts of the business.

GG