The Labour Government

[Roachy]

That's the status quo today, which I am broadly in support of. Let's see what happens to it in October.

I might make, somewhat unrelated, another observation. Sorry this goes on a bit...

Governments always overestimate the amount of money any particular tax change will rake in. Why, because they don't take into account the behavioral changes people make in response to it.

Look at e.g. the Winder Fuel allowance. Labour say they can remove it and save £1.5bn (or is it £2bn, I forget). But then people realise that they can still get it if they claim pension credit, which they have never bothered claiming for previously. The bill for unclaimed pension credit is WAY more than £1.5bn. If only a fraction of pensioners start claiming it, then no money is saved.

Another example: Reducing tax relief on pension contributions to basic rate - another thing they are considering. At the moment your earn £100 and pay £100 into your pension and no tax is payable on that £100. Doesn't matter how much you earn (apart from very high earners who get no tax relief to speak of) that same rule applies. So if you pay 20% tax, you get to claim £20 back. If you are a 40% tax payer and you paid 40% tax, you get to claim £40 of the hundred back etc. Seems fair enough. We want people to save for their retirement so everyone gets to save into a pension without paying tax on their contributions.

So Labour are first of all lying by saying this is "unfair" that the better off get more back than the less well off. Plainly it is not unfair at all, it is merely a system whereby your pension contributions up to £60k per year are untaxed. The "rich" get their £45 back and the "poor" get their £20 back because that's how much was taken from their pay in the first place.

Now, Labour are considering reducing the tax relief to a flat 25% or 30%. They imagine this will bring in a couple of billion in tax savings from the better off, since the government will only have to give a proportion of the 40% or 45% tax back. What they are not considering is that people will just think fuck it, what's the point of putting money into my pension - which will be taxed at 25% when I take it out at retirement - if I am only going to get 25% tax relief putting the money in in the first place. So they will stop paying into their pensions and it will generate zero tax savings. Worse, Labour will have to give back to the lower paid group MORE money than they took off them in the first place. It's an idiotic idea.

Finally, and too much to type in detail, but tax receipts went down when the top rate of income tax was raised to 50% and went back up again when they were reduced back to 45%.

Shareholders, that's where a lot of profit goes, doesn't it?

 

[metalblue]

There's £7.6bn found today

Home Office criticised for billions of asylum overspending

The Home Office is criticised for submitting spending estimates on asylum it "knows to be insufficient".

www.bbc.co.uk

Over 3 years so works out at £2.5bn a year. It was already in the figures (see below) so wasn’t “found today”

 

[metalblue]

We can invest in the energy market and reduce our need to buy as much on the international market.

That seems more sensible than adjusting duties slightly.

Any investment will take years to bring any fiscal benefit to the consumer. I do agree we should do it just borrow the money and create growth. It seems a sensible approach and one I hope they take.

In the meantime the books need to be balanced-ish, in the overall scheme of things Reeves can only pick around the edges - maybe find £20-30bn which isn’t a lot compared to all our money the government spends.

 

[Chippy_boy]

Re the £22bn black hole Labour knew nothing about, this is a very interesting clip. This is Keir Starmer, IN MAY 2024:

 

[Alan Harper's Tash]

Any investment will take years to bring any fiscal benefit to the consumer. I do agree we should do it just borrow the money and create growth. It seems a sensible approach and one I hope they take.

In the meantime the books need to be balanced-ish, in the overall scheme of things Reeves can only pick around the edges - maybe find £20-30bn which isn’t a lot compared to all our money the government spends.

Yep and I’d reinstate the WFA until energy costs are back within our control.

It can’t be means tested as it’d cost more than paying all the elderly.

We should also create a huge R&D drug sector to develop drugs to use at cost price for the NHS and sell around the world to fund the NHS.

We need progressive ideas, not everybody posting different figures about things that back up their party of choice.

You see it everyday.

£22b black hole? Here’s a graph.
Bollocks. Here’s my pie chart.

Doesn’t get anyone anywhere.

 

[Blue Maverick]

It's a dilemma, when my mum died my Dad was 85, me and Mrs H and my sister looked after him but it was hard work, cooking, shopping, having meals with him everyday, getting him up in the morning, spending time watching football or just TV with him, it was a full time job and I was running my business as well.

He lived for 3 and a half years until July 22, he left his estate to me and my sister, if he'd gone into care it would have cost around £175k, it would have made our lives easier. It's not just about money though, you do your best for your loved ones, I'd have never left him on his own, he was so lonely after my Mum died, they'd been married for 65 years.

I get some people don't have the choices we did but it's awful the hard work that paid for houses, pensions and savings is taken away whilst others on benefits all their lives get the same treatment FOC.

Just for the looney left on here I'm not talking about genuine people on benefits, just those who are too lazy to work and come up with all kinds of excuses.

You know there are a lot of people who critisce the Muslim community for various things but I’ve never seen an elderly one in care, all the care homes I visited were full of “white” people, they look after their elderly, they buy a bigger house or extend or buy two and knock through. They know once they’ve gone then they will move into that part and so on and so on. What you’ve done is what I if I have to do will do, I couldn’t put either of my parents in a hime and as long as I can do it I’ll bloody well have them. Now I know not everyone can do it, especially when it comes to dementia, but far too many are happy to turn their parents off into a home.

 

[metalblue]

Yep and I’d reinstate the WFA until energy costs are back within our control.

It can’t be means tested as it’d cost more than paying all the elderly.

We should also create a huge R&D drug sector to develop drugs to use at cost price for the NHS and sell around the world to fund the NHS.

We need progressive ideas, not everybody posting different figures about things that back up their party of choice.

You see it everyday.

£22b black hole? Here’s a graph.
Bollocks. Here’s my pie chart.

Doesn’t get anyone anywhere.

Good idea on NHS. As you say it’s this sort of idea we should be looking at for the future. We look enviously at the way Norway used North Sea gas/oil as a wealth fund whereas we spunked ir away on the here and now. No one is going to mind pain now if we can see a bold plan for the future, well a few might but you can’t please all of the people all of the time.

 

[BigJoe#1]

Re the £22bn black hole Labour knew nothing about, this is a very interesting clip. This is Keir Starmer, IN MAY 2024:

Labour supporter or not.... Two tier Keir Starmer is a liar and a criminal. 100% indefensible.

 

[johnnytapia]

As somebody who’s kids will end up paying IHT on my assets (though hopefully not for a long time) there’s something profoundly perplexing to me about inherited wealth.

People’s number one argument against IHT tends to be along the lines of “I worked hard all my life to set up my kids/family for the future, so it’s wrong to stop me passing the earnings from that hard work onto my kids”.

Yeah okay, sure, maybe you worked hard… But did they? The people actually receiving the wealth. What have they done to deserve that, exactly? Existed?

I find it weird that these are sometimes the same people who talk about layabouts getting handouts for nothing on the one hand, but then are rabid about giving their own handouts on the other. Money for nothing is fine as long as it’s my kids getting it and not some stranger? Seems a touch hypocritical. The benefit is completely de-coupled from the cost. If they want the benefits they should earn it, I thought that’s what rugged capitalism was about?

Confusing. I get it is a matter of opinion but it will never make sense to me. I might want to put a backstop in place to ensure my family avoids destitution after I’m gone, sure, but other than that? They can carve their own path. They should carve their own path. Until we’re at the point where we as a society live in abundance and work is no longer necessary, it doesn’t square with me.

Politics of envy in this respect looks a lot to me like moral consistency.

Almost verbatim from the Double Jeopardy Podcast episode 33 with Tax Lawyer Dan Neidle. Great podcast.

Episode 33: Dan Neidle - I’m the Taxman by Double Jeopardy - The Law and Politics Podcast

Ken Macdonald and Tim Owen discuss lawyers undermining the rule of law, the fall of Nadhim Zahawi, and the morality of paying tax with founder of Tax Policy Associates, Dan Neidle.

podcasters.spotify.com

 

[metalblue]

You know there are a lot of people who critisce the Muslim community for various things but I’ve never seen an elderly one in care, all the care homes I visited were full of “white” people, they look after their elderly, they buy a bigger house or extend or buy two and knock through. They know once they’ve gone then they will move into that part and so on and so on. What you’ve done is what I if I have to do will do, I couldn’t put either of my parents in a hime and as long as I can do it I’ll bloody well have them. Now I know not everyone can do it, especially when it comes to dementia, but far too many are happy to turn their parents off into a home.