Looming LTA

zagfles

Thrugelmir said:

zagfles said:

Albermarle said:

zagfles said:

Albermarle said:

 The push for keeping the maximum cash in the SIPP is to reduce taxation mainly by keeping monies outside the estate - this though relies on the rules not changing radically in the next 20-30 years.  Any bets on that?   

The ability to perfectly legally  use pensions to avoid IHT seems illogical to me ( even though it will probably benefit me) , so you might think it will change at some point , in some way . Although as seen this week this government ( and previous ones ) tend to shy away from increased tax on wealth, capital etc and prefer to tax working people .

What they've done this week goes against the trend. LTA (obviously a capital tax) threshold was at £1.8 million a decade ago, personal tax allowance was about £6k. Basic rate income tax was 22% 15 years ago.

LTA has been massively cut, and now frozen. Personal allowances have risen massively. Tax rates have been cut.

Tax on earned income has been falling (in general) this century. Tax on wealth has been increasing.

The announced NI increase counters the trend.

This BBC article says the opposite .

Quote 

The permanent response to the pandemic recession is to raise taxes on pay packets, working hours, and jobs permanently.

This pattern is not an accident. It is the consistent cross-party political consensus that reflects the perceived political reality of where tax coffers can be squeezed.

The tax base has shifted from capital and wealth to labour and wages over decades.

It seems that property, capital and wealth, particularly in the form of housing is an untouchable asset, and should typically be able to be left free of tax even beyond the grave.

Why tax pay packets more and not property? - BBC News

 Labour won 3 elections on the back of a promise not to raise tax rates. The Tories promised the same in 2019. Labour broke their promise, with the financial crisis as an excuse, but even then only on very high earners, and the Tories now with the pandemic.

Not true. Brown first raised Employees NIC by 1% in 2002 so as not to break the income tax pledge.  To bury this rise, the announcement was in the small detail of the red budget book and scheduled over a year in advance. Went on to increase it further.

What is "not true"? Labour promised not to raise income tax rates. They did, in 2010, when they created the 50% band. That is when they broke the promise. Not when they raised NI rates, as that didn't technically break the promise. 

Thrugelmir

zagfles said:

Thrugelmir said:

zagfles said:

Albermarle said:

zagfles said:

Albermarle said:

 The push for keeping the maximum cash in the SIPP is to reduce taxation mainly by keeping monies outside the estate - this though relies on the rules not changing radically in the next 20-30 years.  Any bets on that?   

The ability to perfectly legally  use pensions to avoid IHT seems illogical to me ( even though it will probably benefit me) , so you might think it will change at some point , in some way . Although as seen this week this government ( and previous ones ) tend to shy away from increased tax on wealth, capital etc and prefer to tax working people .

What they've done this week goes against the trend. LTA (obviously a capital tax) threshold was at £1.8 million a decade ago, personal tax allowance was about £6k. Basic rate income tax was 22% 15 years ago.

LTA has been massively cut, and now frozen. Personal allowances have risen massively. Tax rates have been cut.

Tax on earned income has been falling (in general) this century. Tax on wealth has been increasing.

The announced NI increase counters the trend.

This BBC article says the opposite .

Quote 

The permanent response to the pandemic recession is to raise taxes on pay packets, working hours, and jobs permanently.

This pattern is not an accident. It is the consistent cross-party political consensus that reflects the perceived political reality of where tax coffers can be squeezed.

The tax base has shifted from capital and wealth to labour and wages over decades.

It seems that property, capital and wealth, particularly in the form of housing is an untouchable asset, and should typically be able to be left free of tax even beyond the grave.

Why tax pay packets more and not property? - BBC News

 Labour won 3 elections on the back of a promise not to raise tax rates. The Tories promised the same in 2019. Labour broke their promise, with the financial crisis as an excuse, but even then only on very high earners, and the Tories now with the pandemic.

Not true. Brown first raised Employees NIC by 1% in 2002 so as not to break the income tax pledge.  To bury this rise, the announcement was in the small detail of the red budget book and scheduled over a year in advance. Went on to increase it further.

What is "not true"? Labour promised not to raise income tax rates. They did, in 2010, when they created the 50% band. That is when they broke the promise. Not when they raised NI rates, as that didn't technically break the promise. 

Cynics would say the NIC rise of 2002 was premeditated. Already thought through prior to the 2001 election. Brown had to pay for his welfare state expansion and the growing number of civil servants required to undertake his reforms. There was no economic crisis back then. As there was in 2008 or 2020.  

zagfles

Thrugelmir said:

zagfles said:

Thrugelmir said:

zagfles said:

Albermarle said:

zagfles said:

Albermarle said:

 The push for keeping the maximum cash in the SIPP is to reduce taxation mainly by keeping monies outside the estate - this though relies on the rules not changing radically in the next 20-30 years.  Any bets on that?   

The ability to perfectly legally  use pensions to avoid IHT seems illogical to me ( even though it will probably benefit me) , so you might think it will change at some point , in some way . Although as seen this week this government ( and previous ones ) tend to shy away from increased tax on wealth, capital etc and prefer to tax working people .

What they've done this week goes against the trend. LTA (obviously a capital tax) threshold was at £1.8 million a decade ago, personal tax allowance was about £6k. Basic rate income tax was 22% 15 years ago.

LTA has been massively cut, and now frozen. Personal allowances have risen massively. Tax rates have been cut.

Tax on earned income has been falling (in general) this century. Tax on wealth has been increasing.

The announced NI increase counters the trend.

This BBC article says the opposite .

Quote 

The permanent response to the pandemic recession is to raise taxes on pay packets, working hours, and jobs permanently.

This pattern is not an accident. It is the consistent cross-party political consensus that reflects the perceived political reality of where tax coffers can be squeezed.

The tax base has shifted from capital and wealth to labour and wages over decades.

It seems that property, capital and wealth, particularly in the form of housing is an untouchable asset, and should typically be able to be left free of tax even beyond the grave.

Why tax pay packets more and not property? - BBC News

 Labour won 3 elections on the back of a promise not to raise tax rates. The Tories promised the same in 2019. Labour broke their promise, with the financial crisis as an excuse, but even then only on very high earners, and the Tories now with the pandemic.

Not true. Brown first raised Employees NIC by 1% in 2002 so as not to break the income tax pledge.  To bury this rise, the announcement was in the small detail of the red budget book and scheduled over a year in advance. Went on to increase it further.

What is "not true"? Labour promised not to raise income tax rates. They did, in 2010, when they created the 50% band. That is when they broke the promise. Not when they raised NI rates, as that didn't technically break the promise. 

Cynics would say the NIC rise of 2002 was premeditated. Already thought through prior to the 2001 election. Brown had to pay for his welfare state expansion and the growing number of civil servants required to undertake his reforms. There was no economic crisis back then. As there was in 2008 or 2020.  

Possibly. But they did also cut the basic rate of tax from 23% to 20%.