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Just listening to the news headlines and inflation is at 6.2% and the Rishi is due to announce some measures today to provide support to the increases in cost of living.
Last week inflation was high, so the bank of England increased the interest rates.
I understand that increasing interest rates puts less money in your pocket, or makes it more expensive to borrow, so you spend less, which helps to control inflation. So why would the government want to put more money in our pockets, that will drive further inflation?
Is this just political point scoring?
Whilst I'm at it, one of the suggestions is to cut fuel duty by 5p at a cost of around £2bn. Again, I dont understand why. The recent increase in energy and fuel prices must have bought more environmental benefit than any government policy ever has, not only that but the government have clean hands as its an international issue with the bonus of it not costing anything and and the gov generate more revenue from existing % duty rates.
Obvs this doesnt gloss over the real hardship that households face, but if getting inflation under control is real priority then dont we need to suffer a bit?
I was also puzzled by the potential fuel duty cut when it would surely help those struggling more to apply a subsidy to energy bills, which everyone has to pay. A third of households don't have access to private cars.
I understand that increasing interest rates puts less money in your pocket, or makes it more expensive to borrow, so you spend less, which helps to control inflation.
I don't get it either. It's not discretionary spending that's driving inflation, so I'm not even sure of the logic of this approach is valid at the moment.
If done right (I doubt it will be) the support could end up in the pockets of people with no discretionary spending, so little effect on inflation, where as interest rates should damp demand from business and the better off.
So much of this is supply side inflation though. Costs are up everywhere, and that can’t really be mitigated against with the tools this government is happy to use. Step one is to make it easier and cheaper to trade with close economies, rather than those which add huge fuel miles to goods including food. Step two is to insulate Britain and massively increase onshore and costal renewal energy production and storage, not just pin everything on at sea production and gas use for peak demand.
As for (vehicle) fuel… I agree with you, let the price stay high and put money in pockets via tax and benefit changes instead… so that the “support” can help those using public transport as much a possible as well as those driving more.
Because there are local elections in May
And , in more detail, if the Tory party are looked on as the nasty party (nasty, corrupt and lying) BUT economically competent it's not a good look if you're demonstrated not to be especially competent economically as well
It's how you target the suffering is the issue - support is needed by those facing the choice between eating and heating, not by those struggling to choose between a Tesla and a new conservatory.
The pandemic and the fuel price hikes should be focusing attention on changing how society moves to a more sustainable footing, but that's a generational shift and governments are 40 years behind the curve - it was a topic covered in my O level geography back in the 80s ffs.
I think the mistake would be in thinking they've got the slightest idea what they're doing - they're just making it up as they go along, mindful only of the headlines.
I was also puzzled by the potential fuel duty cut when it would surely help those struggling more to apply a subsidy to energy bills, which everyone has to pay. A third of households don’t have access to private cars.
Fuel prices affect everyone though - bread doesn't bake itself, and it doesn't transport itself to the shops, so everyone is affected there as well.
It's not quick or easy to make changes to the tax system though. In terms of family budget I suppose many poorer people spend a disproportionately large amount on energy (Fuelfor the car to get to work or heating and cooking)
The £4 per month duty saving is really going to help me with the £80 gas/elec rise and £30 extra council tax
[rolls eyes]
Fuel prices affect everyone though – bread doesn’t bake itself, and it doesn’t transport itself to the shops, so everyone is affected there as well.
I’d guess very little of that (most) supply chain(s) relies on unleaded as opposed to diesel. Tax cut on petrol is just a sop to Tory voters.
economically competent
Ha! Stop, it it hurts.
The red side are more competent, the blue side introduced and raise taxes and always leave a huge deficit when de-selected.
What we are seeing is government by the accountancy class who don't have the ability to see beyond saving a fiver this week that will cost the rest of us a monkey to put right in a month's time. It goes hand in hand with not realising that providing a service doesn't have to generate it's own profit so long as it benefits wider society.
About 17% of the pump price of fuel is VAT, so as the price has risen the total tax take has risen. Cutting 5p off fuel duty removes the tax windfall.Maybe that's part of the logic.
I understand that fuel prices affect everyone albeit in a less direct way. But the increase in energy costs has been and will be much greater than fuel increase. So I just assumed that would be the obvious one to target because it's a direct and mandatory expenditure for every household. Though I understand they've already announced that loan scheme for energy so maybe that's all they're doing.
Its all about giving to the rich and taking from the poor. Fuel duty cut will give the rich far more than the poorer sections of society and of course the poorest who do not own cars get nowt
The best way to put money in the hands of those who need it most is thru the benefits system which can be done quickly and easily - remember the £20 uplift during covid restrictions?
But this is the tory party their only purpose is to concentrate power and wealth in the hands of the wealthy.
If Howard Cox and his band of frothing ranters were lobbying to cut domestic gas and electricity prices instead of petrol and diesel would Sunak by looking at making a bigger cut there?
Heard Cox on the radio yesterday and he sounded like Farage.
Some interesting thoughts.
The point about being able to target those that most need support makes sense - but that wouldnt be through fuel duty as said.
singletrackworld.com/forum/topic/i-dont-get-it-inflation-high-so-raise-interest-rates-but-now-extra-support/#post-12300104
I wonder what has happened to volumes though? Presumably the increasing prices and the pandemic (eg working from home) have lead to big reductions in fuel sales?
The red side are more competent, the blue side introduced and raise taxes and always leave a huge deficit when de-selected.
Can’t remember that happening last time!
Politicising this issue is probably pointless just now, the government departments with their permanent staff are who control the data and reports, think tanks, etc then support them with assurance and review.
Will wait and see what happens though, I dare say fuel duty is a political one, it’s an easy win, as it effectively costs them nothing, as the increase in fuel prices means the VAT has gone up to bring more tax in.
Fuel prices affect everyone though – bread doesn’t bake itself, and it doesn’t transport itself to the shops, so everyone is affected there as well.
Actually, red diesel is largely being removed from use imminently, so engine fuel cost for some sectors, (farming probably the most pertinent to general inflation as food cost will rise to compensate) will be getting hit with a double whammy of new duty and price increases!
The best way to put money in the hands of those who need it most is thru the benefits system which can be done quickly and easily – remember the £20 uplift during covid restrictions?
I do and of course the conservative government put them in place, supporting those that may (or may not) have needed additional support.
Lets not also not forget the £150 council tax support to those in, erm, smaller houses (that presumably cost less to heat).
I think the weather this week will make it easier to forget about energy prices for a while, people wont need to trade heat for food for another 6 or 7 months.
Well the whole issue is politicised. Cutting fuel duty is a political decision that benefits there voters and makes them look like they're doing sometihng for the poor people , but you don't see an increase in Universal Credit to account for increased inflation
What we are seeing is government by the accountancy class who don’t have the ability to see beyond saving a fiver this week that will cost the rest of us a monkey to put right in a month’s time. It goes hand in hand with not realising that providing a service doesn’t have to generate it’s own profit so long as it benefits wider society.
Imagine upfront investments on ffordable social housing, school, family support, vocational training, and then the savings in crime, antisocial behaviour, benefits etc. Never gonna happen.
I think the weather this week will make it easier to forget about energy prices for a while, people wont need to trade heat for food for another 6 or 7 months.
Next week's forecast suggests otherwise
Well the whole issue is politicised.
Every budget throughout history has been politicised.
Did you wake up yesterday? Competence and planning are not this government's strong suit. They make changes that are easy not necessarily ones that work long term
About 17% of the pump price of fuel is VAT, so as the price has risen the total tax take has risen. Cutting 5p off fuel duty removes the tax windfall. Maybe that’s part of the logic.
Yes, very true. There is a fixed amount of duty on a litre of fuel (58p). Then there is VAT on top which is just a percentage (20%) of the total. So at £1.70 a litre 34p is VAT. at 1.40 a litre (which is roughly where prices were pre crisis) The VAT take is 28p. Knocking 5p off fuel duty isn't really costing the government anything as I doubt they had factored in a massive hike in VAT from fuel into the budget.
So as to be expected from Sunak, he is doing the absolute minimum while trying to look like he is giving money away.
I understand that increasing interest rates puts less money in your pocket, or makes it more expensive to borrow, so you spend less, which helps to control inflation. So why would the government want to put more money in our pockets, that will drive further inflation?
You are not grasping how poor a lot of people in the UK are. They won't be spending less because interest rates are high when all their money is used up on food, energy and accommodation.
Give them a bit more money and they can pay their bills, eat etc,. None of which will drive inflation.
What wbo said. It's always economy first. If or when things settle down then they can tub thump about how they're the party of prosperity and economic stability etc ad nauseum. This in turn will appeal to even those who are suffering from their policies.
Fuel duty cut will give the rich far more than the poorer sections of society and of course the poorest who do not own cars get nowt
There are a lot of poor people who need cars to get to jobs (because PT is ineffective, and they were forced to take whatever job they could find that may have been difficult to get to) and are struggling to put fuel in. These are the people who will be hit the most. The rich can still afford to put fuel in at these prices.
Read the guardian link molgrips
Put the same amount of money into benefits then the poorest get far more money and the rich get nothing
Reduction in fuel duty gives money to the richest
Can’t remember that happening last time!
No it didn't but by the same token the economy didn't tank and Gordon Brown was the go to chap by other world leaders for advice on stemming the crash. See the whole picture not just the bit that plays to media stereotype.
Imagine upfront investments on ffordable social housing, school, family support, vocational training, and then the savings in crime, antisocial behaviour, benefits etc. Never gonna happen.
Removes at a stroke the scope for culture wars from the current shower. I see no downside!!
EDIT Maybe we should act like we expect more from our political representatives, the electorates version of nudge theory.
The interest lever is utter nonsense.
It's basically the only lever the BoE choose to use. They're absolutely tinkering at the seams and using a sledgehammer. For all the wrong reasons. Antiquated. (All this happens because were trapped in a four decade long mindset that the private market solves human needs.)
We are way past monetary policy fiddling. The BoE really do need a new remit and controls. (Evidence did show up in the pandemeic of this.)
There has always been some form of inflation somewhere in the economy. This particular brand has shifted from HPI to CPI - so is particularly cutting.
If you really want to understand inflation (and to be fair no one really does.) Here is nice update.
Don't let the right wing fool you - the current inflation is not caused by issuing money.
I'd also go further - Sunak is both incompetent and complicit. A Brexiteer too his bone, and equally doesn't understand how the economy works.
So whenever he opens his mouth rubbish pours out. The BoE performed 400billion of Q/E during the pandemic - more or less the amount spent on the pandemic. Money cost neutral.
No borrowing cost or cost to the tax-payer and yet Sunak on record saying the government doesn't have money of its own.
How can you be this stupid and ignorant? Well that appears to be a given thee days.
The country is ripe for re-wiring - were not going to get that today.
The trouble with the 'economy' at large is that workers have become separated from it.
So we look to these experts to control inflation and taxation - but they're indifferent to the human cost in this process.
We listen to the business commentators and they talk about the FTSE and all this bollocks without the human cost attached to it.
Only one place can create new money for spending that fires economy and that's the government through new money. It's the money that makes up the national 'debt' that ironically sits in circulation driving the economy. The aim to reduce this in difficult times is the exact opposite of what we need to do.
Commercial banks have their place but they issue loans, so although that can drive investment it's not like the investment that government makes.
A balanced economy not a balanced budget should be the aim.
I think recession is coming to be honest. It was almost there in early 2020 and now we've had these supply shocks post pandemic that create inflationary ripples - we will be heading back there, unless big spending is correctly targeted.
Put the same amount of money into benefits then the poorest get far more money and the rich get nothing
Not disagreeing with that. Just that fuel prices do affect many poor and struggling.
Episdoe 129: MMT Lens On The Chancellor's Spring Statement
New podcast on what might be on the table in Sunak's statement. (From an MMT perspective.)
I'm big fans of these guys. They do good work and analysis. I interviewed them both in 2020 for a project I was researching.
I haven't read the rest of the posts but in my view it's pure flailing around BUT tied to their ideology.
Their ideology is why we are here, and their key policy (Brexit) is negatively impacting the UK. They've no way out, so it's just smoke & mirrors and the highest taxes in living memory (40 years of work in my case).
Just that fuel prices do affect many poor and struggling.
As ever... the answer is to make the poor less poor (or in this case, take action to stop them becoming more poor as their incomes are devalued by the rising cost of living), not to give tax breaks to those who can and do buy more (of in this case fuel) than them.
No, I don't get it either.
As an armchair economist, I confidently, and wrongly declared that the BOE wouldn't raise rates because inflation is being driven by global events (and yes, Brexit) and not overconfident consumers. Raises rates now seems like kicking us when we're down.
On the face of it, the BOE are doing just that, in an almost insultingly simplistic way, they're targeted with keeping inflation at 2% and they'll act to achieve that as best they can, however painful or even sensible that is. You can read it yourself here:
https://www.bankofengland.co.uk/knowledgebank/why-are-interest-rates-in-the-uk-going-up#:~:text=W e've%20put%20up%20interest,help%20bring%20inflation%20back%20down.
It will reduce inflation, but not in a good way, economically anyway. Consumers will have to reduce digressionary spending to focus on essentials, but prices of those are rising quickly would only makes the situation worse. When retailers all start selling on price, you know there's a recession coming.
Then, here we have Sunak rushing in to save us all! The best thing, in my eyes at least would be to either scrap the NI rise for 12 months, or forever, or the duty on home energy. I think those would be the fairest and best ways to help. Reducing the duty on vehicle fuel... yeah it helps business, but there's a million better ways to do that. Vehicle fuel is a vote winner, very, very few people drive just when they need to, or drive in the most economically way possible. I think everyone's got a bit of flex they can use to try to mitigate that, and with crude prices falling, it would be easier to threaten the oil co's with a windfall tax to get them to pass the savings on.
To me, it's Sunak beating us with one hand, and then wiping away our tears with the other. We're being pimped really.
We have been living through an asset bubble for the past 30-40 years, while wages has stagnated.
We need inflation, especially wage inflation to equalise the equation. Unfortunately that does not match the neoliberal political consensus.
And what happens to all the people without assets?
I think recession is coming to be honest. It was almost there in early 2020 and now we’ve had these supply shocks post pandemic that create inflationary ripples – we will be heading back there, unless big spending is correctly targeted.
I'd say it's inevitable. The pandemic may keep the GDP figure positive and 'technically' not in recession, but the economy is delicate. There's can't be many people in the UK who are going to be able to maintain their usual spending habits in face of rising taxes and bills when the energy cap rises again in Oct, we'll take a much bigger hit, that £200 levy will hardly make a dent.
I'm sure I'm going to regret only fixing my mortgage for 2 years last month, I wish I'd swallowed the 10 year rate.
As usual Richard Murphy has it nailed. In short, we're being shafted good and proper. Not just the poor, but everyone. How we're not on the streets over this daylight robbery is a mystery.
"Without virtually any prior warning an inflation crisis has emerged that is wholly down to profiteering in the supply chains for food, oil and domestic energy. Since the actual costs of production for these items has not changed in any material way, exploitation can be the only explanation for what is happening in the face of shortages caused by Covid, war and, in our case, Brexit."
Without virtually any prior warning
Er... some people have been warning about the cumulative effects of dependancy on imported fossil fuels and putting up trade barriers with the rest of the continent... and who will benefit/profit from that... and the effect of quality of life for the average person... for yeeears.
But his assessment that this can only be addressed by holding down the cost of fossil fuels I can't agree with. That's only one of the options. It's the one the French seem to have gone for as it's simple to understand (they are perhaps scared of people coming onto the streets in yellow bibs), but isn't the only way. Intervention in that market is essential, but taking only that approach could benefit the well off more than those genuinely struggling (ie those not buying food while holding down two jobs... not those reconsidering driving to Scotland for a weekend of riding).
tthew
Actually, red diesel is largely being removed from use imminently, so engine fuel cost for some sectors, (farming probably the most pertinent to general inflation as food cost will rise to compensate) will be getting hit with a double whammy of new duty and price increases!
If I've read it correctly Agriculture, Horticulture, Fishing & Forestry can still use Red rebated fuel from the beginning of April 2022?
dazh
Full Member
As usual Richard Murphy has it nailed.
I agree with a lot of what he says, 5p off isn't going to solve anything, not when the forecast over the next month or so is for another 10-20% increase in fuel prices, same with aiming at Universal Credits or the likes to stave off the upcoming recession, or worse, that'll never do anything, there's just way too many variables and the row of dominoes that are lined up will fall even harder then, which will then affect the poorest even more.
This type of event, you really wish that all parties would pull together and work as a team, as a real parliament, utilising their resources for the best chance of outcome, as stated before, there are a lot of departments, universities, think tanks, etc that the government has resourcing and reviewing their policies and plans, would be nice to actually see the options and workings rather than just headlines.
some people have been warning about the cumulative effects of dependancy on imported fossil fuels and putting up trade barriers with the rest of the continent
He's not talking about that, he's talking about the speed and scale with which this crisis has unfolded. I know the temptation for you to crow that 'we told you so' is overpowering but really you had no more idea than anyone else of the scale or speed of this, or the causes. Still though, if you want to celebrate the impoverishing of a population to prove a point about brexit then carry on. 🙄
But his assessment that this can only be addressed by holding down the cost of fossil fuels I can’t agree with.
So central heating is a luxury that the plebs can't expect to have next winter? Good luck with selling that. It's all very well talking about ramping up renewables, and that absolutely should happen, but not helping people now will do far more damage to the fight against climate change than a temporary reduction in fossil fuel prices.
you want to celebrate the impoverishing of a population to prove a point about brexit then carry on
Here we go... just stop it. I'm not celebrating anything, just not agreeing with the idea that there wasn't "virtually any prior warning" as regards fossil fuel dependancy or that there would be profiteering and an impact on the cost of living on the back of separating Great Britain from the rest of the European market. I'm just disagreeing with some elements of an article you posted. I'm not cheering on any of this mess.
So central heating is a luxury that the plebs can’t expect to have next winter?
No, I didn't say that. I've been saying the exact opposite, if you care to read my posts.
I’d also go further – Sunak is both incompetent and complicit. A Brexiteer too his bone, and equally doesn’t understand how the economy works.
Its worth remembering that out of the lot of them, Sunak is the one who doesn't just name-check Fatcha, but really, really believes. He is a complete ideologue that EVERYTHING should be left to 'The Market' with absolutely zero state interference. He's on the record stating this time after time
So if anyone is seriously expecting anything at all that will make the lives of the most people any easier, you're in for a disappointment. Remember that in response to rising heating costs he offered a government loan. Thats it. Expect more of that today.
I posted this on the Boris thread: Anthony Browne, one of new utterly vile and obnoxious Boris-cheerleading Brexity 2019 intake of MP’s, has just been on the Five Live MP’s Panel now.
He clearly hasn’t got the first clue about the reality of people struggling with rising living costs (the subject of discussion), and more importantly; clearly couldn’t care less either. He did use the reframe on the issue: ‘well, people are just going to have to live within their means’.
I reckon that'll be Rishi's attitude too.
'The Market' is king. If thats not working for you... tough.
He did use the reframe on the issue: ‘well, people are just going to have to live within their means’.
Doff your cap peasants, didn't YOU know/understand what you were voting for?
just not agreeing with the idea that there wasn’t “virtually any prior warning”
Vague and unspecific predictions back in 2016 about economic calamity do not constitute 'prior warning' of this particular crisis. This crisis is a direct result of profiteering by energy, oil and food suppliers which has been enabled by a tory govt who will do nothing to prevent it. Using brexit as an excuse only allows Johnson and Sunak off the hook. They could fix this, but they won't, because they're not on the side of the population and only care about the interests of big business.
well, people are just going to have to live within their means
Of course that's what he said For years the Tories have been framing the poor as either deserving (pensioners) or undeserving (everyone else) If you have to count the pennies, or there's too much month at the end of the money, that's your look out, and your fault obviously
Stood in the queue behind a young lass at Mo's yesterday I watched as she tried to work out what to put back when she realised she didn't have enough money. The people in line behind her were literally fighting over who was going to to pay for them for her. It was lovely and poor lass was in tears, but this is happening already!
Using brexit as an excuse only allows Johnson and Sunak off the hook
Your article mentions Brexit. I didn't bring it up. I deliberately avoided using the word, because of course we could still be more connected with European markets without being an EU member... there are many examples across the continent. We could have left without much of the damage/opportunities that have come out of the process of leaving due to the political choices made by Johnson, Sunak, Mogg etc on our behalf (and in their interest).
Fuel duty cut by 5p from tonight for 12 months.
Zero rate VAT on home improvements related to energy.
If you rent and don't drive... then your new support is... er...
NI threshold increased by £3K. Everyone paying NI gets that cut (well, they're calling it a cut, but with the increased NI rate... it probably isn't for most).
Final announcement that... just before the next election... they'll be a 1% cut to the basic income tax rate. Handy timing. Vote Sunak.
If you have to count the pennies, or there’s too much month at the end of the money, that’s your look out, and your fault obviously
This is the big right-wing lie. The suggestion that if you're poor, it's your own fault. But whilst it's occasionally the case on the whole this is a vicious lie perpetuated by people who are too greedy and mean to want to help others. They just construct a fiction to justify being mean.
If you have to count the pennies, or there’s too much month at the end of the money, that’s your look out, and your fault obviously
This is the big right-wing lie. The suggestion that if you’re poor, it’s your own fault. But whilst it’s occasionally the case on the whole this is a vicious lie perpetuated by people who are too greedy and mean to want to help others. They just construct a fiction to justify being mean.
I think there's also an element of them wanting to think that the rich are deserving to be rich, and it's not just luck or down to your many*great granddad being a bigger bastard than others around them, and if that's the case then the opposite must be true.
Even those who don't have a privileged background but end up rich are themselves lucky to have been born with the aptitude and skill to do so; and there's always a good dose of luck.
Even those who don’t have a privileged background but end up rich are themselves lucky to have been born with the aptitude and skill to do so; and there’s always a good dose of luck.
Absolutely. And only because of the rest of society around them.
Even those who don’t have a privileged background but end up rich are themselves lucky to have been born with the aptitude and skill to do so; and there’s always a good dose of luck.
Yep, sums me up. The difference between me and others at work in same position is that I put it down to luck (including luck of having an ability than gets a good wage) whereas they put it down to all their hard work. Guess which party they vote for....
I think there’s also an element of them wanting to think that the rich are deserving to be rich
It's another perverse Americanism that we've imported. A lot of the traditional Merican churches believe that the rich end up rich as some kind of reward from god for their righteousness and are thus deserving of their wealth. While the poor on the other hand...
It's an irony that usually escapes them that the wealthiest individuals seem to demonstrate not one shred of any supposed christian values. Donald Trump probably being the epitome of this, though there are no shortage of other examples both in the US and now here. All the Tory cabinet for a start.
A third of the poorest people in the UK can’t afford/don’t run cars. The richest, who own the biggest most expensive and thirsty cars consume 5x more fuel than the poorest.
The Tories are primarily interested in carving off chunks of public assets, services and expenditure to give to their mates - diverting tax revenue to enrich themselves and their followers.
There are plenty of areas where Government investment could be used to drive economic growth and prosperity, but that would mean an increase in the size of the ‘state’. They would rather they channel money into the hands of private enterprise where some gets fed into director’s renumeration and bonuses, including those ex and current MPs acting as ‘advisors’ and Non-executive directors. One of the reasons austerity failed in the UK was that ‘cheap’ money through QE was used by many businesses to fund share buy-backs, thus driving up dividends,P/E ratios and bonuses rather than investing in growth and productivity improvements.
UK productivity and growth has stalled in comparison to G7 peers - increasing interest rates may kill off what little growth there is. The UK economy is also very dependent on consumer spending in retail and services a lot ‘funded’ through credit cards and debt - with fuel and food prices rising, it erodes this discretionary spend. Quite a few people forecasting a recession in the UK as consumer spending gets hit hard.
It’s another perverse Americanism that we’ve
importedexported
Well... it seems us at home will lose for 3 months, and then be back where we were from July... well apart from the £100 increase in utilities.
The BOE rate rises have little to nothing to do with rising inflation right now, it's more like an attempt to get interest rates back to a more reasonable level and give room to do something if there is another shock. As to the fuel duty cut, it will provide some benefit to the poorer sections of society in the form of limiting food price rises, public transport costs etc but it will certainly provide more of a benefit to the richer end. A better thing to do in my opinion would have been a cut in tax rate of domestic fuel. This too would have benefited the richer more but would have provided a more immediate relief to the poorer sections of society than the fuel duty cut.
Fuel duty cut will give the rich far more than the poorer sections of society
I’m a little lost , or not understanding it properly.
So Rich Tarquin in his fuel hungry motor uses 100 litres a week. So he saves a whole £5 from his fuel bill .
Poor Dave in his frugal motor that does the same amount of miles using a mere 20 litres only saves £1 on his fuel bill.
So are you suggesting Tarquin has saved more money than Dave overall.
Considering it’s cost Tarquin over £58 in fuel duty and £18 in vat as opposed to Daves £10 odd in Fuel Duty and £4 in vat them I’m sure Daves better off financially (whilst driving the same miles) than Tarquin
Not to mention the higher amount of VAT Tarquin has paid for his car in the first place , and probably VED and luxury car tax for the first 5 years.
Maths might be a bit out in the calcs above but you get the gist
Seems to me that Sunak has tried to retain Tory votes, while implementing changes that make lower income families not have quite so much of a monthly shortfall for absolute essentials, while giving higher income families effectively more disposable income to further drive out of control inflation.
Roll on the next General Election and the hope of a miracle vote swing from the Dec '19 result!
So are you suggesting Tarquin has saved more money than Dave overall
Yes
Tarquin is loaded and so can afford to run his V8 motor that does 20mpg and costs £500 a year VED, but now has £5 more in his pocket to spend on skinny lattes.
Dave has little money, is frugal and wise and so has bough at Kia that does 100mpg and is £20 VED a year.
Hes now going to save £1 a week, which is nothing compared to the £10 a week increase he has on food and heating.
If Tarquin is hard up he can always chop in his V8 for a cheaper model, but Beatrice thinks the neighbours would look down on them both for owning a Kia.
It’s an irony that usually escapes them that the wealthiest individuals seem to demonstrate not one shred of any supposed christian values.
See also it is easier for a camel to pass through the eye of a needle. . .
Yep, sums me up. The difference between me and others at work in same position is that I put it down to luck (including luck of having an ability than gets a good wage) whereas they put it down to all their hard work. Guess which party they vote for…
Are you me? 🙂
But Tarquin is putting that £5 back into the local economy, assuming he buys his skinny lattes at the local hipster artisan coffee house rather than the tax fiddling multinationals that plague the high street. Will probably spend more than that £5 on parking to the local authority too.
It’s easy to knock the “rich”.
Assuming they pay their taxes correctly , the input into the financial system of the country is far higher than “the poor”. Don’t forget Tarquin on his high wage has lost all of his income tax allowance as well as any child benefit he may have received for young Rupert and Tabith as well.
Not saying they should be getting anything extra for their money.
Or are we just talking about the super duper “elite” and their tax dodging ways 🤔
So... when looking at today's fuel duty cut announcement... Dave has received bugger all help with his fast rising bills, yet Tarquin can feed inflation via conspicuous consumption with his tax cut? Sounds about right. [ over simplified to the point of being meaningless, but so was the original example ]
Yeah.. I'm no economic expert but it would be more beneficial to cut the price of gas or electricity than a tiny bit of petrol/diesel tax?
It's all smoke and mirrors, he's still making 1p more in VAT than he was pre price hike as was pointed out earlier.
As for Tarquin being the spawn of the devil for earning more, feel free to support the culture war. Apart from the super rich, well paid PAYE people in this country pay huge amounts of tax with very little support if things go wrong. That's of course right and proper but it does get a little boring when the narrative is continually suggesting they are lucky or dont earn their salaries. Of course some get there through the old boys network, most work hard and use the skills and intelligence they have to earn their wages. In the same way many low income workers work damn hard there are also those who make minimal effort. Gross generalisations don't help.
Until we sort out the cost of housing which is ridiculously inflated the social / income divide is only going to get worse. A tax cut here, a benefit rise there isn't going to make any meaningful difference.
As for Tarquin being the spawn of the devil for earning more
He isn't. Who said he was? But the fuel tax cut benefits this (made up) character more than Dave (also entirely fictional). The discussion was about the government's new "extra support", who it helps, and how it fits in with other measures aimed at restricting inflation.
continually suggesting they are lucky
Er... if you are well off, you are lucky. Aren't you? Even if you are well off though your work. Even if it's just the luck to be healthy enough to work at all.
Very well put stumpyjon. Bit too rational for these type of threads though.
That’s of course right and proper but it does get a little boring when the narrative is continually suggesting they are lucky or dont earn their salaries
That's not *quite* what we're saying.
Many people do work hard for their high salaries. But equally, many people work hard and get **** all. The point is that that you mustn't *blame* the poor for being poor, you must recognise that the system is frequently stacked against them and work to undo that. Which is more or less what you are saying.
Fixing the system will take money, and it should be the rich that bear the brunt of paying for it, because they have the most to start with. You can't take all their money, because then there's no incentive to work. But taxation should be progressive - which is recognised, just don't try and undo the progression by the back door.
Nothing wrong with being rich. What's wrong is the rich stacking the system in their favour.
To each according to his need; from each according to his ability.
poor tarquin, it's not his fault
and it isn't.
Point remains that one has choices; other does not, and relatively speaking is not helped very much by the vat cut. The impact is felt on one more than the other. You see that right?