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So my first thought is, how are we paying this back?
Inheritance tax from everyone that died of covid
So my first thought is, how are we paying this back?
Money isn't real, don't worry about it.
Money isn’t real, don’t worry about it.
This 👆
Here we go....
Tax, inheritance and Gains thresholds frozen for 5 years after next years rises. Blimey. Just negotiate something else other than a pay rise if you're close to a threshold.
Corporation tax goes up to a tapered 25% in 2023 after projected recovery on profit only with a fixed lower rate on small business.
It is bringing a Brexy Bonus; contactless payments are to be increased to £100. Apparently, this is only possible because we aren't in the EU.
Booze and fuel taxes gone as well. Maybe he's found a way to tax Amazon!
Booze and fuel taxes gone as well
not gone, just not increased - big difference
tbf Kryton57 - thats how i heard it too... ever the optimisit.
A few more self-employed people now exist, but the majority of us still don't
I'm not actually real
Nations don't need to pay debt back. Need to be able to afford the debt servicing - basically interest. Debt reduction really means as a percentage of GDP and that is done by making sure growth in GDP is bigger than net borrowing
So my first thought is, how are we paying this back?
...your great, great, great, granddaughter from the year 3000 is paying! 🙂
The establishment of freeports?
That should reduce the tax take quite considerably
not gone, just not increased – big difference
Yes of course I mistyped.
…your great, great, great, granddaughter from the year 3000 is paying!
Indeed, this about finding our way carefully to 2026, but the borrowing at 97% of GDP at that point is a bit of a shock, lets hope we don't have another pandemic or interest rate rise. We are sailing very close to the edge, perhaps relying on more people in employment or business profits rising to help pay it back.
I like the Freeport idea although no doubt its more nuanced than I can understand....
So my first thought is, how are we paying this back?
Pay what back?*
I haven't had a bean from the government and have paid more tax than ever?
I'd like to hope there's a full audit of the costs. Why should I have to pay for government incompetence?
*It's a rhetorical question. I'm aware of what the costs actually are but think many of them need looking at with a lot more scrutiny.
So my first thought is, how are we paying this back?
While debt is cheap we wont, and that will be a issue for once things get back to "normal"
Its a budget for growth.
Grow the economy and tax intake will increase naturally.
From first impressions it seems a pragmatic but bold budget.
I don't mind the principle of paying more tax for better public services.
I do mind paying more tax to line the pockets of mates of the tory party.
Grow the economy and tax intake will increase naturally.
You said it more concisely than me. Kier Starmer is very humerous in critique, but I don't see an alternate proposal from him*.
*I'm not a Tory, and won't be voting Tory btw.
how are we paying this back?
Paying what back?
If you're referring to the debt incurred by covid, then could I refer you to this excellent thread which explains it all. It's very long so let me summarise:
- Alll of the covid debt has already been 'repaid' by the Bank of England through QE. The govt effectively is in debt to itself.
- A significant portion of 'the debt' is represented by Bank of England reserve accounts which prop up the banking system. Removing them would risk a banking collapse
- Much of the rest represents the savings of everyone in the country. Why would we want to pay that back?
- No government has ever paid back 'the debt' since it was created because the debt represents a surplus in the economy. Removing it would plunge us into depression and deflation.
- 'The debt' is in effect our money supply. Paying it back is ridiculous.
https://twitter.com/RichardJMurphy/status/1366665012882857984?s=20
Sir Kier is really floundering be in his response to the budget.
Didn't think his response was too bad tbh, made some cutting points.
Grow the economy and tax intake will increase naturally.
Pretty sure this was suggested as the alternative to austerity all those years ago but was rubbished by the Tories and their press.
Starmer did what he could… focus on the record of the Conservatives in power, including over the last year under Sunak. The chancellor is a great talker about what could happen in future, but the UK economy has been hit very hard under him. And his options were limited by poor policy by his predecessors for the last 5-10 years.
So my first thought is, how are we paying this back?
Via growth or printing money, AIUI.
https://www.bbc.co.uk/news/uk-politics-56266773
Personal income tax allowance to be frozen at £12,570 from April 2022 to 2026
Higher rate income tax threshold to be frozen at £50,270 from 2022 to 2026
affects the poorest the most.....
I like the Freeport idea although no doubt its more nuanced than I can understand…
Only criminals and disingenuous politicians like Freeports, which are you?
And paying it back - we were already in for £2T after the Tories doubled it 2010-2020 - they didn't seem to worry then.
Come on, you can tell my what massive pay rise did he announce for teachers... S Works Diverge coming soon no doubt!!!
I like the Freeport idea although no doubt its more nuanced than I can understand…
Establishing ourselves, post-Brexit, as the tax dodging and money laundering capital of the world
Basically the plan is to inflate our way out of debt. The Brexit dividend will help with this. Freezing the tax personal allowance could really bite some people.
I don't understand why the stamp duty reduction is still in place. The housing market shows no sign of collapse. The headline is that stamp duty is zero up to 500k, but this still results in huge tax break for those buying 800k holiday or work from home properties.
The Brexit dividend will help with this.
We're going to be helped out by a myth?
I don’t understand why the stamp duty reduction is still in place. The housing market shows no sign of collapse. The headline is that stamp duty is zero up to 500k, but this still results in huge tax break for those buying 800k holiday or work from home properties.
You've just answered your own question
Its a tax break for the rich, further fuelling inequality and rewarding capital instead of labour, plus they get to dress house price inflation up as economic growth
Its the entire Tory ideology distilled into one policy
kingmod
Free MemberI don’t understand why the stamp duty reduction is still in place. The housing market shows no sign of collapse. The headline is that stamp duty is zero up to 500k, but this still results in huge tax break for those buying 800k holiday or work from home properties.
That's literally what it's for. And keeping the housing market inflated is an easy way of making the economy look healthier than it is, that's one of the oldest tricks in their book
We’re going to be helped out by a myth?
I mean that the inflation caused by Brexit will help inflating away national debt.
Starmer did what he could… focus on the record of the Conservatives in power, including over the last year under Sunak.
I liked the opening line "It nice being able to sit across from the man making the decisions or a change..."
Otherwise, a bit ineffective. Lets see what the next few days bring. In the meantime I'm off to look for a new house and my sales job now looks more lucrative for the next 5 years 😉
Personal income tax allowance to be frozen at £12,570 from April 2022 to 2026
Higher rate income tax threshold to be frozen at £50,270 from 2022 to 2026affects the poorest the most….
Explain why that is ? Both rates are being frozen for the same time frame. It may affect them more as a higher percentage of their income is in their highest tax bracket but if you earn more, then more of your income is taxed including at the higher rate.
Take £100 off of someone on low pay and it hits them harder than taking £1000 off of someone earning four times as much.
Money isn’t real, don’t worry about it.
Just buy BTC - problem solved.
Brads.....if the
"Personal income tax allowance to be frozen at £12,570 from April 2022 to 2026"
rose between 2022 to 2026, those without a payrise would have more money due to a bigger tax allowance. by freezing it, it means Inflation eats away at their take home pay.
Freezing income tax rates doesn't impact their backers and chums - only little people pay income tax.
Also helps put the middle classes in their place (down) - roles in/around my SME expertise are paying no more in 2021 then I was earning in the late 90's...
Fiscal dragging. It's still the same for any frozen tax allowance.
I accept it does affect poorer people more through how much a pound means to your daily life.
I wasn't being obtuse either I was just confused about there being an actual difference between freezing both.
My mum is moving house to be near us as she ages. Downsizing but spending more to come to the SE. Searches/land registry taking ages, so she was going to miss the SD window costing her £4K she doesn’t really have. This will really help her.
Personal Tax Allowance frozen at £12570 until April 2026 is brutal for low earners, Sunak has ensured low earners are not going to be helping the non-essential businesses recover after Covid, they'll be struggling to cover the basics.
for someone on full time, minimum wage (just over 18k), the tax freeze (assuming their salaries rise by inflation at 3% per year - who knows) equates to tax going from 6% of their salary to 8% - 2% or £580 more
for someone earning 40k, the freeze based on the same figures takes their tax from 13.7% to 14.6% - 0.9% or £1300 more
for someone erning 60k, the same takes them from 19% to 22%, 3% or £3800 more
it seems the 'richest' here are paying the most, no?
Establishing ourselves, post-Brexit, as the tax dodging and money laundering capital of the world
Whaddya mean establishing ? 😆 😆 Isn't that why we've got small islands everywhere ?
This budget doesn't really do anything for me. The Income Tax freeze will make my pay (when I get a job...) worse as inflation goes up, the Stamp Duty Holiday will make the thought of buying my first house even more unattainable (prices will rise until it ends but they will never drop afterwards) and they're setting it all up to push Austerity on us again to make us pay for all the help they've been chucking out for the last year.
Add in the Brexit 'Bonus' that is yet to fully materialise and the next few years or decade look very bleak.
for someone on full time, minimum wage (just over 18k), the tax freeze (assuming their salaries rise by inflation at 3% per year – who knows)
Are you serious? Very few, if any, people in the lower pay brackets are going to get a pay increase for the next few years. Companies will use any excuse related to the pandemic or Brexit to keep pay at the current rate, they may even use it to force through pay cuts! 5% drop in pay or redundancies will be the line at most pay negotiation meetings.
it seems the ‘richest’ here are paying the most, no?
There argument is one of proportion of income; someone on £60k will in theory be far better placed to pay £3800 than someone on £18k paying £580 based on the average cost of everyday life.
Isn’t that why we’ve got small islands everywhere ?
They'll be on-shoring it all. There will be no need for 'crown dependencies' in a few years. It'll all be based in the city of London
https://en.wikipedia.org/wiki/Personal_allowance
last 4 years have meant a £1000 increase in personal allowance tax....
The free ports thing is also an exercise in deregulation, allowing those regions relaxed rules on tax, hiring/firing, customs duties and environmental controls which are in no way a sinister portent of what may well end up rolled out over post-Brexit England.
Are you serious? Very few, if any, people in the lower pay brackets are going to get a pay increase for the next few years
the average rate of minimum wage increase over the last 9 years (2012 was the earliest figure I can find) is approx 3.5% per annum. So yes, I expect all people on very low pay brackets will continue to get pay rises going forwards.
There argument is one of proportion of income; someone on £60k will in theory be far better placed to pay £3800 than someone on £18k paying £580 based on the average cost of everyday life.
I understand the argument, but its demonstratably a smaller proportion of income for minimum wage earners than it is for someone in the higher tax bracket. That said, £50/month spread over 5 years (so a £10/month increase in costs per year) is unlikely to be a lifestyle-impacting change (and neither is the change to the higher earners).
The 2% change to someone on minimum wage is likely to be an even smaller proportion of income once un-taxed benefits and allowances (of which there are fewer for high earners, and rightly so) are taken into account.
the average rate of minimum wage increase over the last 9 years (2012 was the earliest figure I can find) is approx 3.5% per annum. So yes, I expect all people on very low pay brackets will continue to get pay rises going forwards.
Minimum wage is just that, a minimum. Lots of jobs pay just above it, usually just under £10/hr and those have had very little increase over the last 5 years or so. What actually happens is those jobs get hoovered up into the minimum wage, meaning in real terms they have dropped in relative pay to the people they before earned more than. In my last job we had barely had a pay increase for the last 6 years, averaging 0.2% per year. I got a bigger increase in take-home pay from the Income Tax Threshold increases than my wage increase, the company even used it as an excuse to only award small increases!
In 2008 I started the job on £10/hr, minimum wage was £5.73. By 2020 I was on £12.08 whereas minimum wage is now £8.72. So that's a 52% increase for minimum wage and only 20% for me. The inflationary impact for that timeframe was 32%. So that's a real-world increase of minimum wage of 20% whereas I had a decrease of 12%. All of that is before deductions where the difference in actual take-home pay is worse.
A freezing of the Income Tax Threshold hits the lower earners hard, especially if they are not on minimum wage who 'benefit'* from above inflation pay increases by law.
* minimum wage was meant to be up at £9 by now, it should really be higher as having people having to rely on tax credits/UC top-ups while working a full-time week is just a subsidy for big business but that's an argument for a different thread and time.
Two very different observations -
1. The corporation tax hike even with a sliding scale will impact SMEs £250k sounds like a huge profit but it depends on how many slices are required from that pie to pay dividends its 16k more tax which means no grad hire that year. Large business have been handed a huge 130% tax dodge.
2. To be blunt if you live in and around Newcastle/Sunderland and all the way to the Scottish Border - it appears as if there is no leveling up? Treasury in Darlington Investment Bank Leeds, Freeport Teeside, high speed rail Manchester to Leeds... and Richmond in North Yorkshire is at level 1 for leveling up funding as its so impoverished. Also **** all for Scotland.
Feels like a line in the geographical sand.
I'll be £3 better off!!!!
Looks like yesterday is the start of another round of austerity... and even though some headline austerity measures have been delayed to 2023, it really starts next year... and it will be hitting the NHS and care services hardest. You've got to give it to Sunak... he's an expert turd polisher. Our next PM?
I'll be £30ish better off.
Apart from the cuts to council budgets will mean that things that were once free will now require paying for, and my coucil tax will go up by more than the saving to try to claw back what central govt isn't giving them, and that's before we get started on inflation.
Sigh.
The Budget is broadly neutral for us as a family, but I live in Darlington so will hopefully see the impact of the Treasury campus and the bribe Towns Fund in improvements to local services.
£22 better off. But I’ll get hammered on something else. Bike parts for one.
Well... you'll only be "better off" if you don't have to use the NHS or any of the other services facing cuts (that weren't mentioned in Sunak's speech, but are in the budget).
And are your calculations adjusting for inflation? Including council tax rises?