First-ever financial education textbook lands in schools - MSE News

Carl31

hiohaa wrote: »

The section on Why we pay income tax is completely, and utterly wrong.
This is a shocking piece of work and I will be contacting the publishers and creators of this textbook to rectify.

It says
"Today, Income Tax is the biggest individual source of income for the
government and accounts for nearly 25% of government income. This,
together with the income the government raises from other sources, is
used to pay for all the various areas of government spending.
Examples of government spending include:
• Provision of State Pensions,
low income support and
Jobseeker’s Allowance
• The National Health Service
(NHS) – building hospitals,
providing treatment and paying
doctors and nurses
• Spending on schools, colleges
and universities
• The Armed Forces – keeping
the Army, Navy and Royal Air
Force up to date with the latest
technology, and paying the
salaries of our military personnel
• Local councils – providing
services such as emptying your
rubbish bins, cleaning the
streets, etc.
All of these services, and many more, are paid for by the government and
to do so they must use the income that they receive from taxation. Not just
Income Tax but also National Insurance, Value Added Tax (VAT), Council Tax,
taxes on business profits, vehicle tax, and taxes on alcohol, cigarettes, etc"

That simply is not true. None of that is.

Taxes Do not Fund government spending. Government spending is part of the national GDP calculation, and government spending is another way of saying Someones income.
When you pay your taxes, it doesn't get redirected to pay for some service. It goes back to the HM treasury and offsets a credit balance at the BoE.

In much thesame way when you take out a personal loan with a bank, the Bank creates a deposit account on its liability side and a loan account on its asset side - and the money is created, out of nothing. They are accounting entries.

The BoE themselves published in 2014 a document explaining how this actually works, and how new money is created.

Taxes are used to redistribute wealth, to incentivise certain behaviours, and to take money out the economy to control inflation.

They are not used to fund government services. If anyone can find my proof that Taxes are literally redirected to then pay for public services, I'd like to see evidence of it.

this is a book aimed at school children, not trainee accountants.

Fundamentally its correct even if the technical aspects of the accounting have been diluted. In the same way we explain to children babies come from mummys tummy, we dont need to explain ovulation, wombs and all the other bits

hiohaa

Carl31 wrote: »

this is a book aimed at school children, not trainee accountants.

Fundamentally its correct even if the technical aspects of the accounting have been diluted. In the same way we explain to children babies come from mummys tummy, we dont need to explain ovulation, wombs and all the other bits

But its not just about technical accounting. Its not even about dilution.
Its just wrong.
And its far more fundamental then what you're making out, because it dictates the whole farcical political debate around whether we can afford public services, or free education, or free anything.

zagfles

hiohaa wrote: »

The section on Why we pay income tax is completely, and utterly wrong.

Of course it isn't.

This is a shocking piece of work and I will be contacting the publishers and creators of this textbook to rectify.

Yeah, good luck with that. Let us know how you get on.

It says
"Today, Income Tax is the biggest individual source of income for the
government and accounts for nearly 25% of government income. This,
together with the income the government raises from other sources, is
used to pay for all the various areas of government spending.
Examples of government spending include:
• Provision of State Pensions,
low income support and
Jobseeker’s Allowance
• The National Health Service
(NHS) – building hospitals,
providing treatment and paying
doctors and nurses
• Spending on schools, colleges
and universities
• The Armed Forces – keeping
the Army, Navy and Royal Air
Force up to date with the latest
technology, and paying the
salaries of our military personnel
• Local councils – providing
services such as emptying your
rubbish bins, cleaning the
streets, etc.
All of these services, and many more, are paid for by the government and
to do so they must use the income that they receive from taxation. Not just
Income Tax but also National Insurance, Value Added Tax (VAT), Council Tax,
taxes on business profits, vehicle tax, and taxes on alcohol, cigarettes, etc"

That simply is not true. None of that is.

Taxes Do not Fund government spending. Government spending is part of the national GDP calculation, and government spending is another way of saying Someones income.
When you pay your taxes, it doesn't get redirected to pay for some service. It goes back to the HM treasury and offsets a credit balance at the BoE.

You mean a bit like when you spend on your debit card, it offsets a credit balance in your current account. Right...

In much thesame way when you take out a personal loan with a bank, the Bank creates a deposit account on its liability side and a loan account on its asset side - and the money is created, out of nothing. They are accounting entries.

No money is created. Well, not "real" M0 money anyway.

The BoE themselves published in 2014 a document explaining how this actually works, and how new money is created.

Taxes are used to redistribute wealth, to incentivise certain behaviours, and to take money out the economy to control inflation.

They are not used to fund government services. If anyone can find my proof that Taxes are literally redirected to then pay for public services, I'd like to see evidence of it.

I'm sure there's a youtube video explaining it all.

diggingdude

Listened to Martin on the radio the other day about this, I commend any attempt to try and improve the knowledge of our children. As a social worker i come into contact regularly with parents/young people who have absolutely no clue and this will help them, even in later life I think. Hopefully the teachers will be able to understand the teachers guide.

lwaldram

Hi I work for a state-funded SEN school in England. I read about Martin giving away these books to schools and was excited as they sound perfect for the kids at my school, and would fit well with the Work Skills curriculum we teach. However we have as of yet not received any books. Who can I contact to talk about this and get our books?

Thanks