Are we expecting BOE to remain at 4.75% on 8th February 2025?

MattMattMattUK

michaels said:

MattMattMattUK said:

Ibits4321 said:

NorfolkCanary said:

TheAble said:

I lose over a third of my income to tax and NI - I'd say that's enough don't you think?

No.
We have an issue in this country of expecting European quality of services, healthcare provision etc...,with US style level of taxation. One isn't achievable without the other.
If we want quality public services we need to pay for them and actually value & 'invest' in, as the public rather than sit back and expect everything on a plate, so yes, increase tax for all ranges.
What would benefit is increased wages to compensate and government (& buddies) we can trust not to rampant profiteer.

I don't agree with this. We're taxed so much in this country and get barely functioning services because the government are too busy enriching themselves. I don't think anybody would complain about taxes if we had 2010 levels of satisfaction in the NHS and no billions lost on bogus croney contracts/PPE/COVID loan fraud etc. The 50k higher tax threshold being frozen until 2028 is scandalous, by the way. It should be 60k already if it just rose by inflation. I shudder to think what it should be in five years time going off recent levels of inflation 

We are not taxed "so much" in this country, we pay very little in general. More than half of households receive more in cash benefits than they pay in tax, only 20% of households make a net contribution in any one year, only around 3% of people make a net contribution over their lifetime. The bottom 66% of earners in the UK have the lowest effective rate of income taxation in the EU. We have a middling VAT rate but with far more exclusions and zero rated products than any other EU nation. Our corporation tax rate is below the average.

The UK is a low tax nation, we do not pay "so much tax" the majority pay little to nothing. The personal allowance needs to be abolished, with NI and IT combined and rates of 38%/42%/47% implemented.

38%?  Are you sure?

Sorry, I should have been clearer, it should be raised to 38%, the combined rate if it were left as is would be 32% 38% would be roughly in line with the European average for starting rate when things like compulsory insurance are factored in. There is of course the er's at 13.8% on all employees over the threshold, it would make sense to just make that 12% on the entire payroll rather than the oddity of weekly/monthly thresholds if one wanted to remain revenue neutral, or ideally put it to 14-15% to raise additional revenue. 

TheAble

So do away with the personal allowance and up the starting rate to 38%? Blimey...

Maybe we could tax people less and spend the taxes more efficiently instead? I think we're currently dusting 100 billion a year just paying the interest on the ridiculous national debt.

MattMattMattUK

TheAble said:

So do away with the personal allowance and up the starting rate to 38%? Blimey...

Maybe we could tax people less and spend the taxes more efficiently instead? I think we're currently dusting 100 billion a year just paying the interest on the ridiculous national debt.

It would be fairly average by European standards and lower than Scandinavian countries and we will never repay the national debt if we do not get back to surplus...

Ibits4321

MattMattMattUK said:

TheAble said:

So do away with the personal allowance and up the starting rate to 38%? Blimey...

Maybe we could tax people less and spend the taxes more efficiently instead? I think we're currently dusting 100 billion a year just paying the interest on the ridiculous national debt.

It would be fairly average by European standards and lower than Scandinavian countries and we will never repay the national debt if we do not get back to surplus...

Repay the national debt 🙄

MattMattMattUK

Ibits4321 said:

MattMattMattUK said:

TheAble said:

So do away with the personal allowance and up the starting rate to 38%? Blimey...

Maybe we could tax people less and spend the taxes more efficiently instead? I think we're currently dusting 100 billion a year just paying the interest on the ridiculous national debt.

It would be fairly average by European standards and lower than Scandinavian countries and we will never repay the national debt if we do not get back to surplus...

Repay the national debt 🙄

Yep, we are already leaving future generations with the environmental destruction from our refusal to deal with emissions, pollution and the refusal to stop population growth, the very least we can do is not leave them with the debts from our overspending and not paying enough tax. Most of the world's problems are caused because the can keeps being kicked down the road, the very least we can do is start picking up a few of them.

Ibits4321

MattMattMattUK said:

Ibits4321 said:

MattMattMattUK said:

TheAble said:

So do away with the personal allowance and up the starting rate to 38%? Blimey...

Maybe we could tax people less and spend the taxes more efficiently instead? I think we're currently dusting 100 billion a year just paying the interest on the ridiculous national debt.

It would be fairly average by European standards and lower than Scandinavian countries and we will never repay the national debt if we do not get back to surplus...

Repay the national debt 🙄

Yep, we are already leaving future generations with the environmental destruction from our refusal to deal with emissions, pollution and the refusal to stop population growth, the very least we can do is not leave them with the debts from our overspending and not paying enough tax. Most of the world's problems are caused because the can keeps being kicked down the road, the very least we can do is start picking up a few of them.

How are they supposed to repay it with ridiculous house prices, crazy student loan debt, needy ageing parents and grandparents needing care, mad childcare fees, and low wages? I guess they can always just not have children. Glad we've thought this through and our government aren't just thinking election to election 🙄

Sarah1Mitty2

michaels said:

Markets are not pricing in rates much higher than 5.5%.  The fall (not just stop rising but fall) in commodity prices gives suppliers scope to reduce prices if demand weakens so we could still see a sharp (temporary) drop in inflation.

Problem is we are turning a supertanker, mortgage rates are slow acting due to fixes, there is still lots of covid unplanned savings money sloshing around, the fiscal position is still deeply expansive and will only get worse this side of an election and the employment market (and employment expectations) remains strong.

And once it has turned the same factors that mean it is slow to do so will perhaps mean we rapidly ride a downward roller-coaster with slow acting monetary policy the only lever to try and pull out of the dive.

It is so sad, there is a simple fix, a temporary fiscal tightening with higher taxes (I prefer income tax as it does not increase inflation the way VAT would) and is a quadruple win:
1) Instantly removes demand from the economy
2) Applies to everyone rather than making a small proportion of mortgage holders take all the pain
3) Helps with the debt crisis making the trajectory more sustainable and reducing long term borrowing costs
4) Can be reversed instantly once it has done what is needed
(3 also means that he longer end of the yield curve will likely fall encouraging longer term investment due to less crowding out)

I hate it that politics prevents doing the sensible thing.  Personally I think the govt should roll the dice and try 'unconventional fiscal policy'.  Trying to be conventional is not going to dig them out of the political hole they are in so why not try being radical?

It isn`t just mortgage holders, it is anyone with debt including firms that employ people, someone with no debt could still lose their job because their employer can no longer service debt, interest rates spread the pain just fine, the problem is that they started hiking far too late.

Sarah1Mitty2

My take on the rate level is that if Japan moves on YCC it will be 5.75%

smipsy

We're only doing 5.75% if something goes terribly wrong until end of September (not impossible)
However, in all likelihood it is going to 5.5%

VNX

The sentiment now seems to be now how high (5.5/5.75) but for how long they remain at these levels

seems like longer than first expected