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Sven Roeder 6:42 Sun Jan 25
The Greek Election
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Exit polls suggest a clear victory for the anti-austerity Syriza party.
Not clear whether they have enough votes to govern alone as yet.
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Replies - Newest Posts First ( Show In Chronological Order)
Joke Whole
7:31 Tue Jan 27
Re: The Greek Election
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Should the rich simply sit around twiddling their thumbs until the poor catch them up?
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overbyyer
7:08 Tue Jan 27
Re: The Greek Election
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After8 wrote...
Re: The Greek Election
overbuyer
the lowest paid have had their income tax cut.
the 50p rate had been argued to have lost money. Indeed HM revenue and customs show a NINE billion increase in tax revenue since the change from 50p to 45p.
It was changed in April 2013 and whilst NINE billion sounds impressive as a stand alone figure, the treasury has collected circa TWO HUNDRED AND THIRTY billion in PAYE and self assessment tax receipts alone since it was changed.
So by comparison, a nine billion increase is insignificant and could be a result of increased tax receipts from the general uplift of tax receipts as the population increases.
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After8
4:24 Tue Jan 27
Re: The Greek Election
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Here's an opposing view to Polly Toynbee
By Allister Heath
12:43PM BST 01 Oct 2014
At last, David Cameron is being much bolder on tax
There is now a huge difference between the pro-growth, pro-enterprise and pro-aspiration Tory vision and the class warfare, pro-big government Labour mission. We need to see more details of how David Cameron and George Osborne will cut public spending to balance the budget by 2018-19, as promised, while simultaneously and meaningfully reducing the tax burden, but this announcement is a major move forward. The 40p tax rate would (in time) be hiked to £50k and the tax-free personal allowance to £12.5k if the Tories are elected next year, which would represent a major shift. Here are five reasons why today’s tax cuts should be embraced enthusiastically.
1. They show that the Tories are re-embracing supply-side economics and the lessons they had originally learnt in the 1970s and 1980s but then appeared to forget
These tax cuts will boost people’s incentives to work and save; by allowing folk to keep more of their own money, they create a closer connection between effort and reward, something which is at once ethically sensible and economically efficient. George Osborne had previously shown that he believed this with corporation tax - he has slashed rates to improve investment and competitiveness - but had sent mixed messages on other taxes, wrongly hiking capital gains tax, for example. Today’s announcement confirms that the Tories are once again a pro-market party. Sure, the actual extent of the cuts is not huge, and they will take years to kick in. But they will nevertheless be worth an estimated £7.2bn a year by 2020. This is an important and welcome day in British politics. Supply-side economics are back, not a minute too late.
2. The hike in the 40p threshold to £50k will undo one of the coalition's greatest blunders
It was madness for Osborne to have dragged so many more people into the 40p band by lowering its starting point and it is good to see the Tories implicitly admitting their original error. There was a time when very few people actually paid the 40p tax rate: just 1.56m people were eligible in 1989-90 when Lord Lawson, who introduced the rate, was chancellor, equivalent to only 6pc of income taxpayers; this year, 4.71m (roughly 15.8pc) of taxpayers will be affected by the rate. Before the new policy was announced, some forecasters thought that 5.5m might be hit in three years’ time.
Shamefully, the speediest jump took place under Osborne: there were just 3.19m 40p taxpayers in 2009-10, Labour’s last year in power.
The higher rate threshold was cut to a ridiculously low £41,450 in 2013-14, increased to £41,865 in the present tax year and will rise to £42,285 in 2015-16. In theory, that number is indexed - but on past form the rise could easily have been curtailed by a government desperate to raise revenue. So the £50,000 promise (by the latter part of this decade, it seems) is meaningful.
The reason Osborne had so relentlessly lowered the threshold after 2010 was that he was trying to prevent those on higher incomes from benefiting from the increased personal allowance; but that just goes to show how silly the original policy was. The prospect that fewer people will now pay that tax - which is actually 42p when employees’ national insurance is included, and even more when employers’ contributions are added - will go down well in aspirational Britain. It will also help businesses indirectly.
3. It will help make work more attractive for the lower-paid without having to increase the minimum wage in a job-destroying manner
Increasing the tax-free threshold to £12,500 will reduce the cripplingly high tax rates paid by those on low incomes; unfortunately, they will still have to pay national insurance on their earnings but this will nevertheless make a big difference to their take-home pay, which is the only thing that matters. The best way to help the working poor is to cut their taxes, not artificially seek to bolster their wages in a way that is not warranted by productivity and not by boosting costly benefits. We are getting closer to a situation where somebody who works full-time on the minimum wage will no longer have to pay any income tax. This is very sensible: why tax somebody who doesn’t earn much and then give back the money in the form of welfare, including in-work benefits? This merely creates a wasteful, incentive destroying churn.
4. These tax cuts will have supply-side effects
They will lead to more work and more effort than would otherwise have been the case, a phenomenon which mainstream economic models often fail to pick up. But the move will still reduce tax receipts for the Treasury, at least in the short term; the Tories expect to see receipts drop by £5.6bn for the personal allowance increase and by £1.6bn a year for the £50k threshold by 2020. This reduced revenue compared to the current baseline means that the size of the planned cuts will have to be even larger.
But the good news is that the Tories have promised that they will balance the budget by reducing spending, not hiking taxes, so today’s tax reductions will not hopefully be cancelled out by bad new taxes in other areas. The delaying of the tax cuts to after 2017 is meant to help make sure that the budget is balanced by then but there can be no doubt that the 2015-20 period will have to see far greater cuts to public expenditure than many people expect. In fact, with the NHS budget ring-fenced again, and the economy more likely than not to be hit by some as yet unpredictable shock at some point over the next Parliament, the fiscal path will be very tough. It will be manageable, of course, but only with a will of iron and much political cunning.
5. The move will be far more popular than the left believe
A poll by ComRes for the Institute of Economic Affairs revealed 62pc of respondents believe that low earners pay too much income tax. The only problem is that they will take several years before they start to be phased in, and we still don’t know the sequencing or enough details. The Tories have made sweeping tax promises in the past, not least the mooted increase to the inheritance tax threshold to a £1m, which they failed to implement as a result of coalition government.
There are now clear blue waters between the Tories and Labour; the gulf is at its greatest since the Old Labour days. David Cameron is finally taking the fight to an areas of economic policy where has an intellectual advantage. The cuts also show that he cares about the working poor and the aspirational classes. If this doesn’t drive at least some voters back to the Tories, nothing will.
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After8
4:23 Tue Jan 27
Re: The Greek Election
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overbuyer
the lowest paid have had their income tax cut.
the 50p rate had been argued to have lost money. Indeed HM revenue and customs show a NINE billion increase in tax revenue since the change from 50p to 45p.
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After8
4:16 Tue Jan 27
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A Polly Toynbee rant.
She cannot handle that the conservatives have taken the lowest paid out of income tax, have increased the minimum wage and have cut people's taxes while overseeing large scale job creation.
She's failed to mention two other things.
1. The richest are paying more tax than under Labour.
2. The income tax changes boost the poorest the most. She's not mentioned that the government tapers it off. The daily mail have been bitching for years about it.
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Jaegermeister
3:11 Tue Jan 27
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David Cameron spread out a fabulous feast of bribes. Outlining his party’s tax plans in a speech yesterday, the prime minister made clear that lavish tax cuts for the better off will be the £7bn prize for returning him to Downing Street. This comes after a famine of £48bn in public service cuts, the like of which the country has never known. The Institute for Fiscal Studies says there has never been so great a difference in economic plans between the two main parties.
“The people whose hard work and personal sacrifices have got us through these difficult times should come first,” Cameron said. So who exactly worked hardest and took the heaviest burdens – and what will be their reward? Certainly not those who made most sacrifices – the same low earners whose working tax credits and benefits George Osborne will cut again by another £12bn.
With bottomless cynicism, Cameron relies on public ignorance on tax. Like the Liberal Democrats, he hopes most people are clueless as to the true effect of raising the personal threshold. It sounded so progressive when he said that no one on the minimum wage who worked 30 hours would pay tax when the threshold rose to £12,500 in 2020. Surely that’s good for low earners? Well, it delivers them £176 a year. But when you ask the IFS who gains most, the great bulk of the colossal sum already spent on this – more than £10bn – went to people in the upper layer of the top half of earners. Only a quarter went to the low paid. This next threshold raise will cost £5.5bn, and again the bulk goes to higher- not lower-earning households.
Cameron’s other pledge is to lift to £50,000 the threshold before people start paying the 40p rate. That will cost £1.5bn and mostly go to those already earning more than £50,000. “The vast majority goes to the highest 10% of earners,” says the IFS’s James Browne. So there you have it: the feast is for Conservative core voters; famine for those least likely to vote Cameron. The windfall for the better-off comes cleverly disguised as kindness to low earners.
As he spoke he stood in front of the slogan “A Britain that rewards work”. That’s news to all those hard workers miserably under-rewarded. If Cameron’s aim was sincerely to ease the low paid, that £17bn of proposed cuts might instead have introduced a living wage, abolished the bedroom tax and funded gold-standard apprenticeships and Sure Start children’s centres to turn around life chances. It could rescue the NHS and roll out good community care, ending the shame of 15-minute visits to the frail by untrained, low-paid carers.
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Jaegermeister
12:38 Tue Jan 27
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If the Bubbles get their way, don't pay it back and still remain in the EU, the UK election after this one will be interesting, especially if the Tories carry on with their beloved cuts.
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overbyyer
11:46 Tue Jan 27
Re: The Greek Election
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After8 wrote...
Re: The Greek Election
And the evil bankers are paying more tax too through the bank levy. The levy which labour voted against.
So the rich are paying more and the bankers are paying more too.
But still as long as someone on the minimum wage has their taxes being sent to Greece for it to be pissed up the wall then that's ok isn't it?
Banks (not bankers) are paying more. But still nowhere near enough more.
Your justification of scrapping the 50% rate is pathetic. It didn't raise enough (or so you say), but even so, it was raising something and could have been used to offset perhaps a 1% drop for the less well paid.
So lets just repeat the scare tactics - if the masses don't except austerity and the subsequent cuts to social infrastructure then Britain is doomed.
But please, please don't stop filling your face with fast food because Dave and Gideon need you to be a bloated, consumerist pig.
They don't give a fuck if it makes you weigh 20 stone - but please die of a heart attack before you go to hospital.
Because they don't want to pay for that either.
The Greeks have given austerity an Olympic sized slap.
And you Tory boys cant cope with it.
But do you think the EU will cast them adrift?
Thankfully the EU sees this as a Governmental level issue and won't actually let the Greek nation starve.
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SurfaceAgentX2Zero
10:40 Tue Jan 27
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Labour's beloved minimum wage. Which everyone else opposes.
And yet Labour failed to keep it in line with inflation whereas the coalition have increased it in excess of inflation.
Go figure...
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Dick Gozinia
10:39 Tue Jan 27
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are the bubbles all going to end up herding goats and riding donkeys again then? Holidays are gonna gt CHEAP
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ray winstone
10:26 Tue Jan 27
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Ah, the minimum wage, the Labour idea that was going to 'destroy industries' according to the Tories.
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After8
9:29 Tue Jan 27
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And the evil bankers are paying more tax too through the bank levy. The levy which labour voted against.
So the rich are paying more and the bankers are paying more too.
But still as long as someone on the minimum wage has their taxes being sent to Greece for it to be pissed up the wall then that's ok isn't it?
Personally if I was on the minimum wage I'd want my money staying here in the uk helping people here who need it. Or I'd want a tax cut because a tax cut for people on the minimum wage equates to a rise in their tax home pay. The governments already cut their taxes but the conservatives want to cut them more.
I'd want a rise in my minimum wage too which is what the government is doing.
But hey let's all reject austerity, let's all spend like there's a magical money tree in the back garden and expect our children and our grandchildren to pick up the tab?
I mean why not go the whole hog and just hand people the money for free?
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After8
9:24 Tue Jan 27
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But they aren't though are they?
Labour introduced the fifty p rate in 2010. It was cut in 2012 after it raised less money than expected so your taxes aren't being used to fund millionaires.
In fact the millionaires you despise are paying more tax every year under this government than they were under labour.
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ray winstone
9:19 Tue Jan 27
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After8, I'm more concerned that my taxes are being used to fund a tax CUT for millionaires in THIS country.
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Mr Polite
8:28 Tue Jan 27
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Cheers Balders
I might buy Kefalonia... And the. Ban P
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Coffee
8:28 Tue Jan 27
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Down the wall, surely.
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After8
8:26 Tue Jan 27
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I note the lefties are strangely silent with the fact that their taxes are being taken by the eu to help fund Greece and now Greece wants more money after pissing it all up the wall.
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Crassus
8:25 Tue Jan 27
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Joke Whole 8:18 Tue Jan 27
I said at the time of bail out that it was not the begining of the end, merely the end of the begining.
The ramifications are huge and wide spread and all because of a loopy idea borne of Franco German federalists.
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Joke Whole
8:22 Tue Jan 27
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Sydney - don't know about a country, but it sounds like you're describing most governments of the 20th & 21st century there...
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balders
8:20 Tue Jan 27
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Mr Polite 8:01 Tue Jan 27
Re: The Greek Election
Will any of this mean cheap Greek holidays?
If not - fuck 'em
Polite it's the cheap property that's were the bargains will be
It will be time to fill yer boots
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After8
8:20 Tue Jan 27
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Greece only has 1.9 billion left and has spending commitments coming up of 2.5 billion plus 3.4 billion is due to the IMF.
Tax revenues have collapsed as the Greeks have decided not to pay their taxes, not that they were much anyway as they're hoping the taxes the government imposed on them are now repealed.
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