General British politics discussion thread

PommieBast · 07-09-2021 5:54pm

https://www.boards.ie/discussion/comment/117858919#Comment_117858919

Any pretense of NIC being anything other than general taxation is long gone. Aparently the government used to have a built-up kitty for pensions, but that was plundered in the 1970s.

Remember that dementia tax debacle well. Might have actually done well had she stuck to her guns, but the sheer speed of the back-peddling was the point she blew her whole strong & stable campaign.

Joe_ Public · 07-09-2021 6:22pm

https://www.boards.ie/discussion/comment/117859395#Comment_117859395

Bosses pay paye for themselves, not for each employee on their book. Unlike with NIC.

NIC is certainly very good for those not eligible for it (entirely coincidentally among the prime tory voting demographic) and for the super wealthy who don't have to bother with the little people's taxes.

Podge_irl · 07-09-2021 6:35pm

https://www.boards.ie/discussion/comment/117859395#Comment_117859395

Its nothing to do with boss' individual wages. An increase in NIC is both a slice out of the employee's take home pay and an extra cost for the employer which in all likelihood will be passed back onto the employee's eventually. You can expect pay rises to take a massive hit if this goes through.

An increase in PAYE means nothing to the employer.

07-09-2021 6:39pm

https://www.boards.ie/discussion/comment/117859702#Comment_117859702

of course an increase in PAYE means something to the employer, they pay PAYE and most likely, dividends as well.

07-09-2021 6:40pm

https://www.boards.ie/discussion/comment/117859635#Comment_117859635

they get taxed, so an increase in PAYE will affect them.

Joe_ Public · 07-09-2021 6:47pm

https://www.boards.ie/discussion/comment/117859724#Comment_117859724

For argument sake, let's say the boss earns 100k and he has 10 employees earning 50k.

Income tax rise of 1% means he'll pay £1,000 extra.

NIC rise of 1% means he pays £1,000 for himself and £5,000 extra for his employees.

Big difference.

Podge_irl · 07-09-2021 6:48pm

https://www.boards.ie/discussion/comment/117859719#Comment_117859719

An "employer" is frequently not a person.

breezy1985 · 07-09-2021 7:04pm

https://www.boards.ie/discussion/comment/117859757#Comment_117859757

Many employers are a massive group of people not a boss. Also many 100k earners are not bosses and pay no employers PAYE for arguments sake.

Joe_ Public · 07-09-2021 7:19pm

https://www.boards.ie/discussion/comment/117859829#Comment_117859829

Right, in my example he's a boss and he's earning 100k.

07-09-2021 9:31pm

https://www.boards.ie/discussion/comment/117859757#Comment_117859757

And less tax would be raised, meaning paye would have to go up more.

it’s a pointless argument, there is always a good chance that any increase in tax is going to result in lower wage increases, but ultimately if you want staff, you have to pay for them.

breezy1985 · 07-09-2021 10:05pm

https://www.boards.ie/discussion/comment/117859877#Comment_117859877

Then he is doing alright in life if he is taking home 100k and shouldn't worry

Podge_irl · 07-09-2021 10:07pm

https://www.boards.ie/discussion/comment/117860648#Comment_117860648

Why would PAYE increases have any effect on wages? NIC increases directly impact a business, PAYE increases do not.

Joe_ Public · 07-09-2021 10:49pm

https://www.boards.ie/discussion/comment/117860648#Comment_117860648

You could raise income tax 2% and it would have roughly the same effect and be fairer because it has a higher threshold in order to qualify to pay it and it doesn't favour the higher earners as NIC does, given only 2% is paid on earnings over 50k.

As it is, NIC has been raised a combined 2.5%, including employer and employee, and if, as economists are suggesting, the employers pass that on, the employee ends up bearing a bigger burden anyway.

I'm not even suggesting either of these would be enough. They're merely scratching the surface and social care will still be in crisis in a decades time. Uk billionaires harvested a further £107bn over the course of the pandemic. Until they address this grotesque wealth imbalance, things will only get worse. That's the bottom line.

Capt'n Midnight · 07-09-2021 11:48pm

https://www.boards.ie/discussion/comment/117861177#Comment_117861177

Imagine if there was a windfall tax on billionaires. Not millionaire or multi-millionaires. And since 50% of the worlds tax havens are Crown Dependencies they could make it stick for one year.

13.8% of £107Bn is £14.766 which is a lot more than the £12bn taxing everyone.

Applying income tax to their increased income would yield much more.

The triple lock pension has been set aside for one year , so pensioners will only be getting 2.5% (CPI) this year instead of 8% (wages).

Capt'n Midnight · 08-09-2021 12:01am

On a slightly different topic. The new elections bill if passed will mean voter ID, reduce union funding and give new powers to ministers.

It has now emerged that implementing voter ID could cost up to £180m a decade. In 2019 595 cases of alleged electoral fraud were investigated by the police. Of these, four led to a conviction and two individuals were given a police caution. Note : most cases were for local elections.

"non-party groups are allowed to spend up to £390,000 in an election, Tulo said, under the new rules, if the limit was shared between all 12 of Labour’s affiliated unions and the party, it would restrict each to just £30,000." ... "A separate clause in the bill gives new powers to Michael Gove, the Cabinet Office minister, to influence the work of the Electoral Commission." ...

Capt'n Midnight · 08-09-2021 12:04am

More taking back control. Can't find the link but the govt will be able to veto a lot of the new post EU environment laws.

So they could be toothless.

Joe_ Public · 08-09-2021 12:14am

https://www.boards.ie/discussion/comment/117861393#Comment_117861393

Great sentiments, heartily endorse, but you know, I recall back in 2008/09, when the speculators had driven the world over the cliff edge, people were destroyed and the banks and bond holders got bailed out with a sharp hit of austerity for everyone else. And the people then said, never again. Next time it'll be the vultures and capitalists to pay, we've suffered enough.

And so, fast forward a decade and here we are again. The vultures have stuffed themselves silly over the course of the pandemic, banker bonuses are on the march again and here's the chancellor of the exchequer saying we can't go on like this, we have to balance the books. And who pays for that? Well, already they gave us cuts to foreign aid and now we have an NIC increase as well as the imminent cessation of the £20 universal credit uplift that is going to drive more and more people below the poverty line. Energy companies posting record profits recently while household energy bills are set to go up by £139 this winter. And on and on and on.

Yep, the little people get to foot the bill again. Just like how it was always going to be. It's idle fantasy to think these politicians would ever take on the people who are funding them tbh.

08-09-2021 8:58am

https://www.boards.ie/discussion/comment/117861393#Comment_117861393

The UK has more no control over the tax affairs of the Crown dependencies than the EU has control over the tax affairs of Ireland. It is a complete red herring.

08-09-2021 9:11am

https://www.boards.ie/discussion/comment/117861177#Comment_117861177

could you provide more detail on that claim of billionaires harvesting €107bn please.

Peregrinus · 08-09-2021 9:28am

https://www.boards.ie/discussion/comment/117860648#Comment_117860648

It's not the case that if social care isn't funded by NIC increases it must be funded by income tax increases; there are many other taxes.

One way of looking at this is that the provision of social care assures middle class homeowners that their houses won't have to be sold to fund care in their declining years, so depleting their children's inheritances. This isn't such a big deal for the poorer groups in society, since their children aren't going to get much of an inheritance anyway. So a rise in NIC or income tax to fund social care, if it is borne directly or indirectly by lower earners, in effect functions as a transfer of wealth from lower earners to the established middle classes.

Obviously, that's an oversimplification, but it's probably true to some extent - concern about having to sell the house, or otherwise deplete savings or investments towards the end of life, is a major driver of middle class worry about social care costs, and addressing this concern is the main reason for the proposed cap on social care costs. And that suggests that a rational and fair way to at least partly fund social care would be a tax on property or accumulated wealth - you pay a modest annual tax on the value of your accumulated assets to insure yourself against the risk of having to flog most or all of them if you become so infirm as to need expensive care. This looks more rational and fairer than a rise in either NIC or PAYE; your risk of needing social care in later life is in no way related to whether you are an earner now, or how much you earn.

(And it has the added bonus that it wouldn't involve Johnson violating his manifesto commitment not to raise NIC.)

08-09-2021 9:39am

https://www.boards.ie/discussion/comment/117862018#Comment_117862018

and instantly collect higher taxes from someone in Tottenham than someone in Toxteth, because the person in Tottenham had to take out a bigger mortgage to buy a similar property in a more expensive area?

Podge_irl · 08-09-2021 9:47am

Its not a similar property, its a property that contains vastly more wealth.

08-09-2021 10:04am

https://www.boards.ie/discussion/comment/117862090#Comment_117862090

so someone who works in the Amazon Liverpool warehouse buys a property in Toxteth for £25k and pays off their mortgage after five years, spending the rest of their life going on Caribbean holidays and driving a nice car, pays less tax than someone who works in the Amazon North London warehouse but who has to take out a far bigger mortgage and pay it over thirty years and sacrifices flashy holidays and cars to do so.

All because one person lives in Liverpool and the other in London?

forgive me if I think that isn't exactly fair.

There's no good answer to this, at the end of the day it is just different ways to skin the same cat.

Joe_ Public · 08-09-2021 10:07am

https://www.boards.ie/discussion/comment/117861961#Comment_117861961

That's the figure from the latest Sunday Times rich list which, as I understand it, is generally considered to be quite reliable. And apologies, it's actually only £106.5bn. I was wrong there.

https://www.thetimes.co.uk/article/sunday-times-rich-list-2021-covid-billionaires-uk-57vjgrp7s

If you want to quibble with that, Forbes goes with a £60bn estimate, though not sure they're covering the exact same timescale. Anyway, maybe we could split the difference and say £80bn? Isnt it great to see some people doing well and, as for all those being pushed below the poverty line and into in work debt, I'd say not to worry because it all eventually trickles down. Doesn't it?

https://www.forbes.com/sites/daviddawkins/2021/04/07/uk-billionaires-are-collectively-61-billion-richer-than-a-year-ago/

08-09-2021 10:12am

https://www.boards.ie/discussion/comment/117862183#Comment_117862183

Si they haven't "Harvested" £107bn, their net worth has gone up due to the value of the shares they hold.

Of which they will be paying an additional 1.25% tax on the dividends.

Podge_irl · 08-09-2021 10:15am

Indeed, your completely invented and wildly unrealistic scenario does not seem particularly fair.

At the end of the day, this is about saving inheritance. It does not even particularly impact those directly involved but their descendants. The descendants of those who own greater wealth are benefitting disproportionately on the backs of those who earn the least.

08-09-2021 10:28am

https://www.boards.ie/discussion/comment/117862211#Comment_117862211

why is it unrealistic?

Property prices in London are significantly higher in London than in Liverpool, that doesn't mean the average Joe in London is significantly wealthier than the average joe in Merseyside and they certainly don't have significantly more disposable income, yet you are saying they should pay more tax?

you can roll this up the money tree as well if you like, a millionaire footballer who plays for Arsenal would pay more tax than a millionaire footballer who plays for Manchester City, because one lives in Hampstead, the other in Prestbury.

It is basically a tax on geography.

Podge_irl · 08-09-2021 10:33am

The "average Joe" in London doesn't own any property

It is basically a tax on geography.

It is, quite clearly, a tax on wealth.

Joe_ Public · 08-09-2021 10:38am

https://www.boards.ie/discussion/comment/117862204#Comment_117862204

Hah, sure ok, that's grand so. And of course, i completely forgot about the 1.25%. If there's one thing we know about the super wealthy, it's that they always without fail pay the taxes aimed at the ordinary guy.

08-09-2021 10:39am

https://www.boards.ie/discussion/comment/117862316#Comment_117862316

it is a tax on something you paid tax for when you bought it (and for which you already pay a higher rate for more expensive properties), with money you have already paid tax on.

It's a tax based on begrudgery.

General British politics discussion thread

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