this 10p tax issue.....

sdooley

Stephen_Leak wrote: »

There is a glimmer of good news. Even though GB seems - somehow - to have conned the rebel MP's (and I am amazed that Frank Field fell for this one), the political damage has been done. The Labour party are now unelectable, at any level.

It is of course rank hypocrisy for the Conservatives, who have always opposed the 10% tax band and supported its abolition last year, to claim they are in favour of making the system more friendly for the poor. Abolishing stamp duty on shares is not going to help the poor, neither is raising the inheritance tax threshold to £1million. Remember in 1997 there was a starting rate of 23% not 20% and no 10% band (and no tax credits).

I don't normally post politics:p but this quote didn't make sense.

Andy_L

According to this
http://news.bbc.co.uk/1/shared/bsp/hi/business/budget_calc/html/budget_calculator.stm
you'll be £29/year better off - don't spend it all at once :-)

beer_tins

ailsajayne27 wrote: »

would anyone be able to explain the whole 10p tax thing to me.. I'm 27, single, rent a room in a house and earn £16,800 a year... I'm not eligible for wtc and I'm getting very confused about this whole tax business!!!

In a nutshell, you are paying a bit less tax than you would have last year (about a fiver less this year!). Those earning less than about 16500 are paying more tax. Those earning more are paying less tax.

That's because they got rid of the 10% tax band and instead lowered the basic rate of income tax to 20%. Around 16500 is the point where the saving in the reduced tax rate makes up for the increase due to the scrapping of the lower tax band. It simplifies things but means the lowest earners are hardest hit.

It's the first income tax change since 1997 that has made those on low incomes worse off. A worrying change for a labour government.

What they should have done to simplify it of course is:

Scrap the 10% band
Keep the 22% income tax rate
increase the tax free allowance by £1216.36

Everyone earning more than about £6450 pays the same tax. Everyone earning less pays £223 less tax a year, added bonus!

Plus increase the allowances on top of that in line with inflation of course.

Vote me for Chancellor!

beer_tins

That should have read: Everyone earning less pays up to £223 less tax a year

Optimist

beinerts wrote: »

In a nutshell, you are paying a bit less tax than you would have last year (about a fiver less this year!). Those earning less than about 16500 are paying more tax. Those earning more are paying less tax.

That's because they got rid of the 10% tax band and instead lowered the basic rate of income tax to 20%. Around 16500 is the point where the saving in the reduced tax rate makes up for the increase due to the scrapping of the lower tax band. It simplifies things but means the lowest earners are hardest hit.

It's the first income tax change since 1997 that has made those on low incomes worse off. A worrying change for a labour government.

What they should have done to simplify it of course is:

Scrap the 10% band
Keep the 22% income tax rate
increase the tax free allowance by £1216.36

Everyone earning more than about £6450 pays the same tax. Everyone earning less pays £223 less tax a year, added bonus!

Plus increase the allowances on top of that in line with inflation of course.

Vote me for Chancellor!

You have my vote

Chrysalis

olly300 wrote: »

Update
According to Working Lunch today the Chancellor is going to:
1. Give an extra winter fuel payment to pensioners over 60 dated from when the tax change came into effect
2. Change the tax credit system for those couples to compensate them for the "average" loss
3. Get the low pay commission to "look at" the pay for workers under 25

Aweful, why doesnt #2 include single adults? Couples have lower living costs since they can share cost of things such as running a fridge.
#3 why not just start working tax credits from the age of 18 and also make them more generous to compensate for the loss of the 10p, seems all a whitewash.

Chrysalis

Errata wrote: »

This will help those who've been penalised by the new taxes but if it goes to all those between 60 and 64 it's a joke - many of those in this group may be extremely wealthy and in no need of it.
Plaster on a headache !

A very vocal and influental age group when it comes to elections tho.

beer_tins

The whole thing is a mess. Changing the law and then tinkering with tax credits and winter fuel payments to reimburse some people is hardly simplifying things.

Look at my suggestion a few posts up. It is so easy to have a simple solution that gets rid of the tax band, simplifies the system and doesn't leave anyone out of pocket. I'm not blowing my own trumpet; I'm saying that if I, with absolutely no training or experience in this area, can come up with a solution, then why can't the government?

Optimist

beinerts wrote: »

The whole thing is a mess. Changing the law and then tinkering with tax credits and winter fuel payments to reimburse some people is hardly simplifying things.

Look at my suggestion a few posts up. It is so easy to have a simple solution that gets rid of the tax band, simplifies the system and doesn't leave anyone out of pocket. I'm not blowing my own trumpet; I'm saying that if I, with absolutely no training or experience in this area, can come up with a solution, then why can't the government?

Its all about control, if you get more in your wage packet you don't think about it, if you have to apply (beg) for it then the idea is that you think, what a nice caring government giving me money !

I'm thinking of changing my name to cynic!

Errata

Caring government = oxymoron. I'm thinking of voting on 1 May, even though it won't make a scrap of difference. I want to register my displeasure.