http://www.guardian.co.uk/politics/2012 ... income-tax

something i very much agree with and argued for over the years ...

I'm in favour of simplifying the tax regime (it is genuinely ludicrous at the mo, largely due to Gordon Brown it has to be said) but I think the measures required to achieve it - keeping the current 'austerity measures' going until 2020 - would be completely unpalatable to large portions of the voting population, so it's very, very unlikely to ever happen.

The Tories plan is to keep this level of spending cuts going until 2015, at which point they hope things will have got better and they can give a little back, to perk up their chances of a second term. If they go into the next election saying "No, there's going to be another five years of this" that's a ruddy hard sell and no understatement.

It's something I've always been in favour of.

i think we are going to have slightly more then another 5 years of austerity but i also believe that simplifying that tax system with a flat rate tax for all will attract businesses world wide including Europe to the UK which will create employment apart from the fact it will stop most (not all) tax evasion and make it far easier for small/medium companies.

I don't disagree but I think the realpolitik is what it is. Even if (in 2015) we're going to have a few more years of a rubbish economy it'd be a brave politician that actually came out and said so. It's be an even braver politician who came out and said 'well, things are still going to be sh!t for a few years yet' when they're the ones that have been in charge for the previous five.

At the next election the tories will have to do everything they can to talk up the economy and labour will do everything they can to talk it down and blame it on the tories. Given that, the plan proposed in the report isn't tenable. It makes all sorts of economic sense, but pretty much zero political sense. If someone had proposed it a decade ago, maybe...

Jon

No doubt it should be simplied in places, but I'm all for keeping the rate bands (basic, higher and additional). It's incredibly easy to work out someone's tax using rate bands, so I don't buy that changing this would somehow save £millions.

i believe that a complete rethink of the tax system is needed and this is major reason in my thinking



http://www.guardian.co.uk/business/2012 ... bal-action

for things to change first i must change
the whole taxation system needs a rethink
a flat rate taxation system is the order of the day, its the only way forward ...

1) If the amount of money in tax havens hasn't grown much since 2007, doesn't that actually suggest money hasn't been being put into them in huge amounts in the last 5 years?

2) tax evasion can't be eradicated. It doesn't matter what your tax system is, people will try to evade it. You can say you want to take less of people's money, but unless you're taking none, some people will try to hide it from you.

True but the simpler the tax system the less loopholes there are that allow (both legal and illegal) tax evasion. By making it simple it bcomes a lot easier to spot those that are doing it

Afterall i do at least 2 forms of leagl tax avoidance - Paying into a pension and an ISA. If I had more disposable income I could increase the amount I pay into a pension so dramatically reducing my tax bill

Have we entered x404 Bizarro world here?

It looks to me like a forum full of people who occupy positions economically to my left are now in favour of: abolishing corporation tax; increasing tax rates for the poor; reducing them for the wealthy; and killing off inheritance tax. And worse than any of that, talk of not taxing the same thing twice is usually code for abolishing capital gains tax altogether... that's how fund managers get nearly all of their pay. The 10K tax allowance and the end of VAT are probably enough to nullify the effect on the poorest, but I would guess that lower middle class families with children and mortgages would get absolutely hammered by that lot.

Quite why the government's share of spending needs to fall by 4.5% of national income I couldn't possibly guess, unless they are simply chasing magic numbers... (or this is some kind of effort to revive the corpse of supply side/trickle down/Reaganomics)... But that's not the kind of number that can be achieved by simply saving on waste in the NHS. 7.5% would hit either investment or essential services very hard.

Normally I'm all in favour of hard headed pragmatic policy calls, but I can't really go for cutting corporation taxes to zero. It would simply encourage every multinational in the world to domicile here for the free taxes (great for the city of London - especially the solicitors who will get to own the PO boxes in which IBM and Apple suddenly live - pretty tragic for every other country in the world). I feel this requires me to wheel out the most annoying cliche this forum permits... Race to the Bottom Anyone?

Hitler

Can we shut this very silly thread now please?

Ok, actually I'm not sure the people actually in favour are to my left. I maybe mistook the absence of screaming indignation from those who do occupy that space as tacit approval, which is foolishness, and I apologise.

And I must confess to missing something quite obvious. The reason I suspect why the government's income must fall so much is because the flat rate has to be set at a level which doesn't penalise the very poor. So they have to get as much back by not shelling out for VAT as they pay in extra income taxes.

So by my fag packet calculations, the bottom 10% neither win nor lose. I'm pretty sure the 80% in the middle lose to varying degrees. And the top 10% make out like bandits on this plan.

banks are not lending they are keeping their resources/capital for themselves
the only other way to progress the economy is via taxation

making it easier for small to medium businesses and employees

i think that any party that takes this on is going to get elected

if that is silly then by all means shut this tread down that's if you can not deal with reality in the real world
sorry its stupid of me, its the economy ...

You've misread I'm afraid.

The report tries to hide it but does make clear that under their proposal, VAT would remain.





Basically they want to increase the income tax for poor people, but without the removal of VAT that would justify it. Instead they essentially want those on low incomes to subsidise big-engined Audis and flights to the Algarve.

It's either blinkered folly or it's totally demented or, as I suspect, the abhorrent mindset of some particularly socially-diseased and over-priveleged dipsh*ts. Any way you fold it, the only it'd make society fairer was if we each got a copy to burn for when strikes cause rolling brown-outs.

i believe with a flat rate tax system that VAT @ 30% should be added to all purchases/selling/costs
VAT 30% & 30% flat rate income tax across the board, no other taxes of any kind

that's 20% income tax 10% NI (or combined)
20% national VAT 10% local VAT

but tax allowance to be increased to £30K for everyone ...

but that is not what this report is suggesting ...