ir35 changes cancelled and a cut in stamp duty so far.. some big changes..
45% tax rate cut as well..
it does seem like the magic money tree will be out in force
Stamp duty yawn.
There wil be no growth based on tax cuts. But it's their main tool.
Only government spending will boost growth.
Reeves up. Even more yawn. Borrowing yawn idiot.
Shut up about the OBR.
He’s doing lots of talking but I’ve not heard much that’ll benefit the poorest in society.
Plenty there to benefit all of his Tory pals though.
1p cut in basic rate of tax plus a 1.25 (?)p cut in national insurance will help the poorest I think. £2-300 all in? its obviously not as much as someone on £200k gets..
Reeves is a dummy.
Without the energy subsidy the consumer would have been paying anyway.
She's lying and doesn't understand how deficits work. The tax-payer barely ever pays the debt down. It doesn't and never will.
I can't be doing with her balance-the-books nonsense.
Come up with spending plans of your own?
Why is she talking about Biden - the democrats will never move away from trickle-down.
His quote has been overstated.
Stamp duty threshold raised to £450k for first time buyers... WTF!
1p cut in basic rate of tax plus a 1.25 (?)p cut in national insurance will help the poorest I think.
FFS the poorest don't pay tax. How can you cut something you don't pay?
FFS the poorest don’t pay tax. How can you cut something you don’t pay?
This!
I was taking "the poorest" as to mean someone working full time on minimum wage. They pay about £2k in tax & national insurance today?
Stamp duty threshold raised to £450k for first time buyers… WTF!
Those young yuppie bankers need a place to stay after smashing their now uncapped bonus pot.
So we've gone from a reckless idiot with seemingly no principles, to fiscal lunatics with disproven and outmoded economic principles that will increase the national debt and generate less govt income unless we achieve the magical 'growth' in the economy
Can't believe i'm saying this, but bring back Boris and Rishi
Stamp duty threshold raised to £450k for first time buyers… WTF!
Aimed at seats in the South of England where LibDems threaten her MPs.
Was Rishi there cheering him on?
Demolition of workers rights starts here.
I just don't get it, throwing away really easy ways to bring in money (windfall tax) which should be used to help the people who need it.
This is a massive handout to those of us who do ok or better with no tangible benefit to the country
Amazing budget for big earners.
Hes completely lying about monetary policy.
Q/E is authorised by the government.
The rich are getting the help. WTF. Conservatives and their mates again ! We need this lot out, bunch of crooks.
Amazing budget for big earners
Agreed but that pool ought to be starting to fall apart these days.
To be honest I thought there might be more bunged towards us scruffs.
I think they will lose elections with this stuff long term.
It's just too old fashioned.
So nakedly a bankers budget. He won't have to buy any drinks in his social circles for quite some time.
Economically illiterate. It would pay to read up on the Barber Boom.
The stamp duty cut doesn't seem that great in most circumstances, unless you are a first time buyer, the maximum saving is £2,500.
Still better than nothing.
1p cut in basic rate of tax plus a 1.25 (?)p cut in national insurance will help the poorest I think.
I am not sure you did think
She’s lying and doesn’t understand how deficits work. The tax-payer barely ever pays the debt down. It doesn’t and never will.
But increasing amounts of tax revenue have to go on servicing that debt (paying the interest on bonds etc.) hence, without tax rises public services and many other things suffer. The Tories are living in cloud cuckoo land thinking the economy is suddenly going to grow massively, earning enough additional revenue to more than offset this. At best, to get any growth happening in the short-term, they're going to have to keep on deregulating the financial services sector and we all know from 2008 where that ends up. Other sectors would be much much slower to invest and grow.
I’ll let him off on the banker bonus thing - it’s a bit of a red herring because (I) there have been ways around the rules for years and (II) banks have been on a much tighter regulatory rein than they used to be.
The stamp duty cut doesn’t seem that great in most circumstances, unless you are a first time buyer, the maximum saving is £2,500.
Still better than nothing.
The FTB buying my partners flat will be pleased (£440k)
Will save us £2.5k on a purchase too but the interest rate rise will take that back over the next 2 years.
The bigger picture looks like he’s sailing close to the wind.
In a service led economy which is actually operating at full employment, it should be more about encouraging investment in greater productivity.
The increased national debt is going to cost a lot more to finance, and the UK has a disproportionate amount of its national debt whose cost is determined by the inflation rate….their calculations are likely to prove a long way out.
This budget will probably be remembered in the history books for all the wrong reasons.
Probably another nail in the Tory coffin but at a huge cost to the country.
Stamp duty cut will be eaten by higher house prices what is the actual point? Oh yes, rich get richer....can't wait for it to trickle down to me!
This government has absolutely no idea on how to grow an entrepreneurial economy. There doesn't seem to be anything there to benefit a SME owner or sole trader unless i have missed something. No surprise really given the bunch in charge.
Clearing out the coffers in anticipation of losing the next election.
A quick look around, I can't see any real support for this budget in any media.
so, a 1% tax cut benefits all, but for those most in need it barely makes a difference
I'll calc at £30K which isn't the poorest, but it's a rough average. Tax threshold is £12500 approx, so then you're paying tax on £18K approx.
1% saving is £180, so £15 a month.
For someone on £20K it's £80 a year. £7 a month.
FFS.
5% off top rate though. If you earn £151K, that extra £1K was taxed at £450, now will be £400. You only need £3.6K over the £150K and you've saved more than the average earner with that cut. Noting too you'll have also saved on the 1% cut on the basic rate too.
How is this just?
[edit - just read on]
"this will greatly simplify the tax system"
It's changing* the number on one input on the tax calculator program. What saving is that going to bring?
*or not changing seeing as it currently says 45%
The institute for economic affairs have been grooming Truss & Kwertang for years
This is all their wet dreams come true
The champagne & fois gras will be flowing in Tufton Street tonight
So what does the actual cut in NI mean?
Does that mean that funding will now be cut to the NHS ?
I can see why the high earners cut will help. Many high earners it currently isnt worth working as the money gets taken straight off you. Many of the high earners do drive employment and productivity.
Probably another nail in the Tory coffin but at a huge cost to the country.
I would be interested to see what Labour would do differently, but that would mean them having to come up with a plan first, and currently they seam incapable of doing that
This government has absolutely no idea on how to grow an entrepreneurial economy.
True, but that’s not their objective. All they want is for the proles to slave away, unable to strike, pouring wealth into the pockets of the rich.
5% off top rate though. If you earn £151K, that extra £1K was taxed at £450, now will be £400.
If you include national insurance you were paying 48.25% and are now paying 42% (I think??)
This government has absolutely no idea on how to grow an entrepreneurial economy.
Indeed. Post Brexshit, this is what we need. We need to grow, dig, build, create, make and service our own needs as a nation. Start to build a new entrepreneurial approach, which delivers more for all.
Once again I'm struck by the different approach in Scotland as we work (slowly, and not perfectly) towards a fairer, more sustainable, healthier and economically stronger nation with what's being announced in Westminster today. Today's budget again is support for the independence argument...
"This government has absolutely no idea on how to grow an entrepreneurial economy. There doesn’t seem to be anything there to benefit a SME owner or sole trader unless i have missed something."
There's quite a lot in there for SME owners and there are quite a few changes that will immediately impact what people do / spend next year.
- The cancellation of the corporation tax increase is quite a big deal. It reduces tax paid before profits are in turn paid out as dividends. In most cases SME owners may be more willing to invest in their businesses because they can get more out as net income. I can't see it in the announcement but I'm assuming that the change to top level income tax will be mirrored in dividends - with the result SME owners may draw down more earnings and in turn spend it in the wider economy.
- The cancellation of the NI uplift will save employers money - giving them more headroom to invest in their businesses or trade through the very difficult period that's still to come.
- The removal of the high rate income rate threshold will see a shift from saving into pensions to very highly paid employees taking more of their income as salary - and paying tax on it along the way. That increased wage packet will in turn be spent and sustain other jobs in the economy. Most of the increased spend will find its way back to the government through corporation tax on increased sales and VAT.
- The changes to stamp duty will likely help to sustain property sales, which in turn sustain jobs in the construction, property maintenance, building supplies, architectural services etc etc etc. sectors.
- The Regional Enterprise zones could have a transformational effect on local economies. Ref the huge shift that's occurred in other countries where this has already happened - which in some cases have see huge areas transformed from low wage / high unemployment to high wage / full unemployment.
Many high earners it currently isnt worth working as the money gets taken straight off you. Many of the high earners do drive employment and productivity.
**** off it isn't. They still take home more than half of what they earn, it was only a 5% difference for salary above £150K, from 40-45%. That's an enormous salary for a nurse, teacher, cleaner, shop worker...... not worth working because you only get to keep half of anything you earn above a threshold 6x a teacher's salary, where's my violin?
Reading Cheddar’s post above suggests that STW has reached Tory HQ
I was taking “the poorest” as to mean someone working full time on minimum wage.
Working 40 hours a week on minimum wage puts you somewhere near the 23rd percentile of earners, ie nowhere near the poorest.
Source here and here. Data from 2020
The removal of the high rate income rate threshold will see a shift from saving into pensions to very highly paid employees taking more of their income as salary – and paying tax on it along the way. That increased wage packet will in turn be spent and sustain other jobs in the economy. Most of the increased spend will find its way back to the government through corporation tax on increased sales and VAT.
as someone who is in this position I can categorically state that no it won't do any of that. I won't put less money into my pension, I'll maximise my sontributions as I always have (allowance premitting). The extra money son't go to additional spending, rather I'll either save it, invest it, or pay down my mortgage. Either way it will NOT find it's way back to the government nor will it help the real economy much. Given the state of the countries fincances this is a BAD idea as are most of the other proposals.
Removing the tapers on personal allowance and pension allowance would have been a better idea. Not because of any tax reasons, just beacuse they're annoying things to calculate!
Edit Actually I read with some relief that it won't actually apply to me as I live in Scotland. The analysis is still valid though.
Many high earners it currently isnt worth working as the money gets taken straight off you.
Try and see it as what they are taking from the pot (their salary after taxes) rather than what they are giving into the pot (their taxes).
When you forget about tax and just see that £20K come into your account each month why can't you be happy with that and why would that make it not worth working?
I earn fairly well and will benefit from the tax cut but I would rather have seen a tax increase for the likes of me while doing something to help low/no earners.
Working 40 hours a week on minimum wage puts you somewhere near the 23rd percentile of earners, ie nowhere near the poorest.
ok but the same data also suggests that even the lowest 1% still earn above the income tax threshold (12,500). I'm not sure how that can be true (surely there's a whole bunch of students and part timers in the world??) but there ya go.
<leaving aside the fact that it's predictably a ****'s budget aimed at benefitting rich and shafting the poor>
I'm intrigued that he has abolished the 45% tax rate above 150k but not the 60% rate between 100k and 120k.
I had naively assumed that people on that sort of wedge had more understanding of tax and stuff and so would realise that he's smoke and mirrors....
Or is it actually that he consciously wants to help the stratospherically rich rather than just the immensely rich?
Ie, never mind that you pay 60% tax between 100 and 120, you're now saving five grand on every £100k above £150k, which is totes awsumms innit...
Shit, I think I've just answered my own question.
It's quite terrifying that for the tories their target audience is no longer the povs on £110k, it's the ones on £230k plus.
Liz Truss' budget means that those earning a million a year will have £54,400 extra in their pockets after tax and NICs. For those earning £25,000, the equivalent figure is about £280.
I can see why the high earners cut will help. Many high earners it currently isnt worth working as the money gets taken straight off you. Many of the high earners do drive employment and productivity.
Sorry, but untrue -the folk who were in a financial position to be able to arbitrarily cut their working hours/pay, or even retire, because of a tax increase are very few in number, and I can't see them being tempted to return because of the offer of a few quid extra in their pay-packet at the end of the month, when they didn't seem to need that income in the first place. Nor are they the types to drive employment and productivity (happy to be given examples)
It is a bloody stupid budget.
I can't see how reducing tax on higher earners will increase the tax take as most are clever enough to be able to sacrifice income into areas that are not taxed without becoming cash poor.
Overall this is just emphasising this government's screw the poor attitude
How is cutting corporation tax meant to promote corporate investment? Surely corporation tax is paid on profits after expenditure, which includes investment? This is how companies avoid paying it in the first place. It's a measure specifically designed to increase investment, so I don't see how cutting it will do that.
so when money was essentially free and interest was low the Govt destroyed public services to "balance the books" and now the opposite is true, they're borrowing money to give tax breaks to rich people.
I think we're going to have a labour Govt in a couple of years time
ir35 changes cancelled
So what does that mean in reality ? The whole thing is scrapped? A lot of faff has been gone through by all concerned to become IR35 compliant, is that now all undone?
I suppose we should be grateful that they've dropped the ludicrous pretence that they give a toss about poor people/disabled people/the north and theres at least now a degree of honesty about purely representing the interests of the rich bankers and those on the highest rates of tax and everyone else can just **** off.
So at least we'll never hear the words 'Levelling Up' ever again.
It went well, didn't it?
How is cutting corporation tax meant to promote corporate investment? Surely corporation tax is paid on profits after expenditure, which includes investment?
Risk and reward - pay less tax then the return on that investment is higher (or you need a lower expected return to take the same risk). I always look at the post-tax, not pre-tax, benefits of investment decisions.
Santa Cruz sales will the through the roof after this 😂
ok but the same data also suggests that even the lowest 1% still earn above the income tax threshold (12,500). I’m not sure how that can be true (surely there’s a whole bunch of students and part timers in the world??) but there ya go.
Fair point - the notes point out that it's actually the 23rd percentile of income tax payers. So there are a whole bunch of part-timers who are below the first percentile
I can see why the high earners cut will help. Many high earners it currently isnt worth working as the money gets taken straight off you. Many of the high earners do drive employment and productivity.
Both these points are bollocks.
Firstly, if you earn £200k then you get a new job for an extra £100k then you still keep £50k of it and you aren't working any more hours than you would on your previous job. So no-one's going to say no to an extra grand a week for the same hours.
Secondly, given that most of us have to work, then the sort of people on those wages will probably go for more responsibility and power anyway because it makes your job more interesting and fulfilling.
Thirdly, the higher earners are managers and strategists etc but they are an integral part of any production, just like the poor sods who have to do the work. If you ignore or dismiss the actual workers, as you are, then your managers won't have anything to manage. In the UK we do this a lot; the people who actually create stuff are not valued, so they get put upon but they somehow manage to keep going and then they get put upon even more etc.
Where I work, we don't have a shortage of managers and executives, but we do have a severe shortage of skilled workers which is causing problems with innovation and our ability to deliver. And we're not alone. We ALL know what our customers need and how we could improve - managers and leaders don't tell us this - but we just don't have the people to do it.
he institute for economic affairs have been grooming Truss & Kwertang for years
This is exactly what I came here to post.
The IEA are basically running the country.
It is their far right dream.
So what does that mean in reality ? The whole thing is scrapped? A lot of faff has been gone through by all concerned to become IR35 compliant, is that now all undone?
No real flesh on the policy, but I'm guessing it removes the onus on determination back to the contractor. Maybe HMRC has more confidence in its abilities to prosecute what it sees as 'abuses'.
The IEA are basically running the country.
It is their far right dream.
Tim Montgomerie admitted as much on Twitter.
The IEA are basically running the country.
Not strictly true. The Taxpayers Alliance also has some input
https://twitter.com/PeterKGeoghegan/status/1567219754045214721?s=20&t=rryW1bj5ho1wB1aYcZW0Dg
They are not even hiding it.
Absolutely no point voting any more. Doesn't matter who is in power, the vast majority of folks will just have to keep getting by the best they can as no-one cares a jot. I'm really depressed about it all frankly, and nothing will ever change. Good luck Scotland. I hope you get your independence after all.
Doesn’t matter who is in power
A decade of Tory PMs will make people feel that way, yes.
which in some cases have see huge areas transformed from low wage / high unemployment to high wage / full unemployment.
Not sure if that's a typo
Lions led by donkeys is a phrase that comes to mind
Many of the high earners do drive employment and productivity.
James O'Brien on trickle-down economics
Not strictly true. The Taxpayers Alliance also has some input
Basically the same thing though just dressed up slightly differently for different jobs. Look at their joint ventures and anonymous donors.
Interesting to see how this plays out with the public the fuel bill help is great but will be overshadowed by the tax cuts , especially for the high earners
That's not necessarily terrible for the Tories as there's are some modest tax cuts on there for the rest, but puiblic services are in a dire state, NHS in for a rough winter, police just record crimes ratothan solve them, councils still decimated by austerity
The housing market is going to heat up but with interest rates set to rise further that's a recipe for trouble?
Seems a mad gamble
Seems a mad gamble
It's an experiment by the IEA and TA. They don't care if poor get poorer.
If it completely ****s the country, the truly rich will not be affected. They will just shrug their shoulders and continue eating their foie gras.
The housing market is going to heat up
I don't think so - anedotally I hear its slowing down fast, and the cuts to stamp duty will just go some way to easing that slowdown
It is their far right dream.
I did think that most of what was said by them over the summer was so much mouth breathing for the Tory faithful...But no. At least they were being honest
I don’t think so – anedotally I hear its slowing down fast, and the cuts to stamp duty will just go some way to easing that slowdown
Mortgages may still be historically cheap, but rates have already risen enough to put off some people, and people are far more likely to stick rather than twist in times of economic uncertainty. If you're struggling to pay for heating, you're not going to find thousands for conveyancing, surveys and removals.
Mortgages may still be historically cheap, but rates have already risen enough to put off some people, and people are far more likely to stick rather than twist in times of economic uncertainty. If you’re struggling to pay for heating, you’re not going to find thousands for conveyancing, surveys and removals.
whilst historically cheap, I think interest rates will make a much bigger difference than fuel prices. most 90% ltv rates are hovering around 4% now and 75% are 3% - thats around double what they were a year ago, so a significant shock to the system. I've got a few mates buying, and they all said that if they didn't have a mortgage locked in, they'd have to pull out
£ about to drop past $1.10. I wonder if we’ll make it to parity…
Mortgages may still be historically cheap
Interest rates might still be historically cheap, but repayments are not, because homes are far more expensive than they have been "historically". Something felt more keenly by those who are new to home ownership (or dream of it).
Doesn’t matter who is in power
No mate, it really really does.
Governments do change, and things do change.
£ about to drop past $1.10. I wonder if we’ll make it to parity
oh how the brexit bugle crowed when the Euro hit parity…
As someone who would benefit (40% tax payer). This budget stinks for minimum wage earners and does not improve the financial health of anyone but the wealthy, bankers and big business.
a budget for spivs by spivs
Doesn’t matter who is in power
Seriously, don't fall for this. Its a classic Tory line, pushed by right wing media. They are very happy with the status quo and don't want that boat rocked. Things can be much better if we get rid of this current lot.
