Budget 2012

[Gre]

Anyone got any idea what this "general anti-avoidance rule" is all about ?

Avoidance is basically managing your tax affairs efficiently... I "avoid" tax by paying into my pension every year for example... Anybody with a company contribution pension does this... So would this rule say this is wrong ? Just changing the tax laws would make sense surely ?

If its not against the law then how can you have a rule that gets you in trouble ???

Its confused me it has

[lost]

I was under the impression that the reduction in the 40% threshold balanced this increase in the basic threshold so that no one paying higher rate tax is actually any better off because of this change. I could have got that wrong though.

[abdoujaparov]

Ok factor in mortgage costs.... Specially on the average house held by the average OAP... Your "Housing Costs" element... The fact many have no mortgage is besides the point when comparing liabilities and real disposable income...

There you go numb nuts

[abdoujaparov]

Its like talking to someone with half a brain... oh wait...

These £29k average house holds tend to for example having bigger commitments like.... KIDS... To name one of the many you won't find in a OAP house...

I can't be arsed with this, you need to go and clue yourself up a bit... OAPs cost us a fucking fortune... and get very favourable tax / benefit treatment....

Of course, there are some that need more support but a lot of them are having a lovely time... and ours and our children's expense...

I hope we have made changes by the time I retire so my kid isn't expected to cover my arse regardless of how much I have managed to save...

[kaosmark2]

If we're going to shoot anyone, can we make it the cabinet please?

[abdoujaparov]

Soylent Green...

Its you who doesn't want to deal with facts...

[kaosmark2]

What I don't understand about Osborne's theory is this....

If people are going to avoid paying tax at 50%, why would they be happy to pay it at 45%? If they're engaging in tax avoidance schemes, then they're clearly c**ts who don't want to pay tax, the rate isn't what's putting them off, it's their selfish attitude.

[pink_triangle]

What I don't understand about Osborne's theory is this....

If people are going to avoid paying tax at 50%, why would they be happy to pay it at 45%? If they're engaging in tax avoidance schemes, then they're clearly c**ts who don't want to pay tax, the rate isn't what's putting them off, it's their selfish attitude.

[kaosmark2]

We shouldn't get hung up on tax avoidance too much... Its still people acting legally.

[Gre]

It reads to me....

"We can't be arsed writing clear and enforceable tax rules so we will write this general rule and then decide on a case by case basis if we wan't to raid your bank account or not."

Heres betting this is used to fuck over people in the middle earning brackets (like plumbers and so on) and lets the hedge fund manager types off the hook...

[Gre]

What do you mean though ?

So you would ban dividend payments for example ?

You would stop employers paying into pensions ?

You would force EVERYONE to subject the WHOLE earnings to PAYE and pay the full national insurance on it ?

I think not many people understand tax laws...

On a separate and related issue... Tories floated the idea of joining income tax and national insurance into one rate. Which would have led to a simpler and more fair system. Seems to have disappeared though...

[Gre]

To have it legal in tax law but then have the general rule kicking in just seems bonkers and complexity we should be moving away from

Edited March 21, 2012 by Gre

[kaosmark2]

What do you mean though ?

So you would ban dividend payments for example ?

You would stop employers paying into pensions ?

You would force EVERYONE to subject the WHOLE earnings to PAYE and pay the full national insurance on it ?

I think not many people understand tax laws...

On a separate and related issue... Tories floated the idea of joining income tax and national insurance into one rate. Which would have led to a simpler and more fair system. Seems to have disappeared though...

[kaosmark2]

I really think the way you stop it is to simplify the tax laws...

[kaosmark2]

Well that is the thing isn't it... When is a loop hole a loop hole and not a tax law

[kaosmark2]

I don't buy into that to be honest...

I think government's generally focus on growth and trying to get investment in... So they make the tax system as friendly as possible... Allowances here, favourable rates there... Do that over 100's of years and you get a right mucky contradicting mess...

[eFestivals]

You would force EVERYONE to subject the WHOLE earnings to PAYE and pay the full national insurance on it ?

I would, yes.

Income is income, no matter how that income has been acquired. A person shouldn't get to avoid paying tax just because as a rich person their income is from more than just their daily grind (if they have a daily grind at all).

In fact I'd tax unearned income - anything that does not come from putting in the hours in a job of work - at a higher rate than I would for work.

[eFestivals]

There is some traction gathering around that... As I said above the Tories have said they want to harmonise NI and Income Tax. The talk was it would apply to dividends. But it raises lots of questions... Like what about employers NI element ? How would it effect pensions and other investments.

As much as you don't like it we do need to consider how we remain uncompetitive in the globalist economy. If you joined the two then you couldn't really just add the overall NI rate to the income tax rate. It would have to be lower I would imagined given the number of extra things it would apply to which it has never applied to.

I realise that doing what I said would have implications elsewhere.

What I was saying I was saying as a matter of principle, rather than something which would necessarily work for the best if done by the UK in isolation. It's simply morally wrong that income that is gained by doing nothing should be taxed at a lower rate than income that is gained by graft.

One thing that should be tackled immediately on that principle is inheritance tax. While I fully appreciate that parents wish to provide for their kids, the 'kids' that benefit with huge amounts of unearned income are predominantly aged 40+, and are (in the main) no less able to work to support themselves than anyone else within society. If people getting money for nothing via benefits is considered so wrong - and an 'encouragement to not work' - then exactly the same principles apply with inheritance.

The lower inheritance taxes in recent decades has been a big part of what has allowed the older generations to steal opportunities for a decent life and the chance of social progress from a large proportion of the rest of us.

(and yes, this is something which would be likely to personally affect me to a huge amount. It's not something I'm saying that is driven by jealousy because I'm not in line to inherit.)

[gary1979666]

But hasn't the money / property that is being inherited been already taxed. A lot of parents put money aside for their families for inheritance reasons. My parents are taking an approach of enjoying their savings while theyre alive, which I fully encourage, but they've said the house will eventually be mine - this is the house that they've already paid stamp duty on out of income they've already paid tax on - and to be fair for latter years of me living there, which I paid towards (drop in the ocean that bit though). I imagine that by the time I come round to selling it (hopefully many years from now), the price will be liable to inheritance tax. I hope this isn't the case for me, but have seen my parent and in-laws doing it - they look after their parents in the later stages of life, helping them through the tough time - saving the government in some of the care that should be given out - to then tax them once they finally lose their parents is pretty harsh.

[eFestivals]

But hasn't the money / property that is being inherited been already taxed.

what's that got to do with anything?

The money I earn gets taxed (PAYE/NI), and it gets taxed again when I spend it (VAT, and a loads of other taxes on spends too).

So if money is 'spent' by being gifted to kids, or by being invested from which there's then a return on that investment, if everything is equal with what happened to those with the most simple tax affairs there's no reason why it shouldn't be taxed again.

A lot of parents put money aside for their families for inheritance reasons. My parents are taking an approach of enjoying their savings while theyre alive, which I fully encourage, but they've said the house will eventually be mine - this is the house that they've already paid stamp duty on out of income they've already paid tax on - and to be fair for latter years of me living there, which I paid towards (drop in the ocean that bit though). I imagine that by the time I come round to selling it (hopefully many years from now), the price will be liable to inheritance tax. I hope this isn't the case for me, but have seen my parent and in-laws doing it - they look after their parents in the later stages of life, helping them through the tough time - saving the government in some of the care that should be given out - to then tax them once they finally lose their parents is pretty harsh.

Why?

It makes me laugh how it's those who bang on about the wonders of free markets, or meritocracies, or how people should have to work to get things when the talk is about benefits, suddenly abandon all of those things which they refer to as 'matters of principle', when it comes to themselves getting a free handout from their parents.

That money is not yours. You have done NOTHING to deserve it. The accident of your birth is not enough for you to deserve it, no more than someone who is born into poverty deserves poverty for all of their life no matter what they might do to try and break out of it.

The only thing which could be said to be wrong is that your folks might have gone thru their life being told that what they might accumulate can be passed onto their children.... but even then, if they'd bothered to engage their brains, they should know that's morally wrong, no less morally wrong than someone on benefits deciding they can coast thru life by living off others work.

The simple fact is that people inheriting causes the rich to mostly stay rich, and the same works at the other end of things causing the poor to stay mostly poor.

Do you think you're a smart and capable person, able to support yourself? Or do you think you're incapable of very much at all and so should be supported by the efforts of your parents rather than your own efforts?

If it's the first, you do not need your parents money, and so should not want it* either unless you're driven only by selfishness.

(* taking it when handed to you on a plate via the tax laws is not the same thing as I'm saying here, btw).

If you're the second, well, I guess you can be admired for the ability to recognise that you're a thick shit and worth fuck all to your fellow human beings.

[gary1979666]

what's that got to do with anything?

The money I earn gets taxed (PAYE/NI), and it gets taxed again when I spend it (VAT, and a loads of other taxes on spends too).

So if money is 'spent' by being gifted to kids, or by being invested from which there's then a return on that investment, if everything is equal with what happened to those with the most simple tax affairs there's no reason why it shouldn't be taxed again.

Why?

It makes me laugh how it's those who bang on about the wonders of free markets, or meritocracies, or how people should have to work to get things when the talk is about benefits, suddenly abandon all of those things which they refer to as 'matters of principle', when it comes to themselves getting a free handout from their parents.

That money is not yours. You have done NOTHING to deserve it. The accident of your birth is not enough for you to deserve it, no more than someone who is born into poverty deserves poverty for all of their life no matter what they might do to try and break out of it.

The only thing which could be said to be wrong is that your folks might have gone thru their life being told that what they might accumulate can be passed onto their children.... but even then, if they'd bothered to engage their brains, they should know that's morally wrong, no less morally wrong than someone on benefits deciding they can coast thru life by living off others work.

The simple fact is that people inheriting causes the rich to mostly stay rich, and the same works at the other end of things causing the poor to stay mostly poor.

Do you think you're a smart and capable person, able to support yourself? Or do you think you're incapable of very much at all and so should be supported by the efforts of your parents rather than your own efforts?

If it's the first, you do not need your parents money, and so should not want it* either unless you're driven only by selfishness.

(* taking it when handed to you on a plate via the tax laws is not the same thing as I'm saying here, btw).

If you're the second, well, I guess you can be admired for the ability to recognise that you're a thick shit and worth fuck all to your fellow human beings.

[eFestivals]

I take issue with this, before I reply on the substance of your arguement.

Are people morally wrong if they don't subscribe to you morals - it's a personal thing. To call someone a thick shit for not signing on to the Neil line of ethics doesn't rate particularly highly in my moral code. You've got some really good arguments across these threads but you seem to make it personal or insulting to the people you argue with which really detracts from what you actually say. A lot of your posts are fine and I read them and actually start to question my own stand point on some of the issues, but other I read and you're just being rude and bullying and any substance is actually lost.

You say "rude and bullying", but I'm simply being succinct and to the point. There's no point calling a brick to the head a tap with a pretty flower.

I'm replying against a point you've made, so I've personalised it around you - but it's not necessarily about you.

But the fact that you've chosen to take it personally gets to mean it does apply and it's hit home. That's a good thing and not a bad thing.

As for the discussion in hand, I don't disagree with inheritance tax per se - I want to see it at a sensible level. Again depends on how you define rich - for parents to pass on a 2 bed house down to their children, which could help them in turn onto the housing ladder without paying tax on it doesn't seem unfair to me.

except the very fact that there is little meaningful inheritance tax is what might keep you off the housing ladder in the first place.

If there was a more meaningful inheritance tax, instead of getting on the housing ladder at perhaps age 40+ via your parents you'd be able to get on the housing ladder at (say) 25 by your own means.

The simple fact is that it is the lack of inheritance tax that is holding you back, not the lack of inheritance tax which enables you.

As for my situation, it's not about me wanting the assets, but it's about my parents wanting to give me them. They could give them to charity if they wanted, and if it was their decision, then I would be fine with that. It's not about entitlement - I;m not entitled to take any of it - they're entitled to give it.

If those who don't wish to work should be obliged to work rather than be supported by other people's money, then that is a universal principle that applies to those who might inherit no less than it does to those who receive benefits.

[abdoujaparov]

So the budget....

Basically it amounts to this. A significant tax reduction for the very rich (if you earn £500,000 a year, it puts £1500 in your pocket), funded by taking money out of the pockets of pensioners, by hitting the disabled and the poorest in society. And a further £10 billion cut in public spending which promises more of the same

it ought to be enough to have people on the streets

[kaosmark2]

As for my situation, it's not about me wanting the assets, but it's about my parents wanting to give me them. They could give them to charity if they wanted, and if it was their decision, then I would be fine with that. It's not about entitlement - I;m not entitled to take any of it - they're entitled to give it.

[kaosmark2]

So the budget....

Basically it amounts to this. A significant tax reduction for the very rich (if you earn £500,000 a year, it puts £1500 in your pocket), funded by taking money out of the pockets of pensioners, by hitting the disabled and the poorest in society. And a further £10 billion cut in public spending which promises more of the same

it ought to be enough to have people on the streets