Budget breakdown

[NMH]

Okay, let's look at the budget without stuff about the party who created it and the party that opposes it.

Raised taxes; 50% tax for the 1% top richest bracket.
Does this effect you?
Is this not a tax on the very people who can afford it, and have traditionally made up tax-dodges to avoid paying anyway?
So to address tax avoidance - Mr Darling expects to raise £1bn of extra revenue over the next three years by closing tax loopholes and schemes .

Cigarettes hiked; Large price rise on a pack of blunts.
Health-hazard aside, this is a 'luxury item' that no-one actually needs.
Many who indulge in it, don't even like smoking! They don't want to keep doing it. They do it habitually. It's unpleasant, affects other people around the smoker, yet they insist on smoking and paying for their habit.

Beer tax increased; Average 3p a pint increase for instance.
So, how much can this mean to your evening out?
Say you consume 6 pints in an evening - let's be liberal and add 5p a pint.
30 pence more for your evening out.
You cannot drive after 6 pints anyway, so your consumption requires you pay for a taxi or public transport - so you already added a few pounds to those pints - but apparently didn't mind the fare home.

Petrol increases;
This will hit the larger vehicle drivers most. Those cars and trucks that burn the most fuel, will require that the driver pay for that luxury and think about their need for it. They'll have to look at their journeys more than ever.
Smart cars and the new low-emission lower-fuel-using electrically enhanced vehicles will be a better buy for many people.
Environmentally, this should be a good thing, whether this government inadvertently indicate this or not. Tax reliefs already exist for fuel efficient cars, and punitive levies for inefficient vehicles.

Borrowing; 175bn announced.
Straight after the World leaders met to discuss maintaining a present and help to enable future growth - Britain borrows.
This was to be expected, wasn't it?
It is a recession, so what DID people expect?

Pensioners;
Winter Fuel Allowance is to be kept at the higher level of £250 for over-60s and £400 for over-80s for another year.
From April 2011, pension tax relief for those with incomes over £150,000 will be restricted so it is gradually tapered to the 20pc rate.
Personal allowances are to be fully withdrawn for those with incomes over £100,000 from next April. Thus stopping the blatant scooping-up by such as bankers, who award themselves outrageous pensions!
The Chancellor confirmed his commitment to increase the basic state pension by at least 2.5pc, regardless of the Retail Price Index.
Capital disregard on Pension Credit is to be raised from £6,000 to £10,000 from November 2009

Education; £250m will be provided this year and £400m in 2010/11 for an additional 54,000 places in sixth form and further education colleges, with consequential provisions for Scotland, Wales and Northern.

Homes; A scheme will be introduced to guarantee securities backed by mortgages in a bid to increase lending.
The stamp duty holiday on properties sold for less than £175,000 will be extended until the end of the year.
An extra £80m is to be given to the HomeBuy Direct, the Government's shared equity mortgage scheme.
An extra £1bn will be provided to help homeowners and boost housing.
£500m of extra financial support will be provided to kick-start building on housing projects stalled because of the credit crunch, including £100m for councils to build new energy-efficient housing.

Jobs;
An additional £1.7bn for Job Centre Plus and the New Deal is to be provided.Additional support for people who have been out of work for 12 months.
From January everyone under the age of 25 who has been jobless for 12 months will be offered a job or a place in training.
Government will work with employers to create or support as many as 250,000 jobs.
£260m of new money will be allocated for training and subsidies for young people to help them gain skills and experience.
Statutory redundancy pay will increase from £350 to £380 a week.
These appear to be thoughtful stimuli for those out of work, in my opinion.

Business;
The Chancellor is extending help allowing loss-making companies to reclaim taxes on profits made in the last three years to November 2010.
This, surely, passes on the hope for stimulating economy at ground level, by helping struggling businesses to recover.
£2.5bn to encourage business investment in industries of the future.
New £750m Strategic Investment Fund to help emerging technologies and regionally important sectors in advanced businesses.
Businesses' main capital allowance rate doubled to 40pc, giving enhanced tax relief to support investment of £50bn this year.
This seems like a stimulus, overall

 

[withdeanwombat]

Have you missed the bit where the govt sends me £3m because amongst these huge figures they won't miss it?

Interesting post,btw.

 

[NMH]

Have you missed the bit where the govt sends me £3m because amongst these huge figures they won't miss it?

Interesting post,btw.

Thankyou ww, sorry I missed the bit about your 3mil - if you don't get that then try the Withdean Wager next week!

My comments are in bold, otherwise the information provided is just the budget details. I might have missed some smaller items of it, but those are the 'headline' details.

 

[bigc]

Ironically, re: booze, I find my nights out are cheaper now then they have been for a few years, and that's in London compared to Brighton.

I admit, wetherspoons are partly to thank for that(plus the fact the ones in London are quite nice as opposed to the nasty one on West Street) but now I'm in the position of paying 99p for a pint(or £1.29) in 2009 which means I spend less than I did when I was sneaking into the Sussex Uni bar four years ago when I was 17, and my pint was £2.05.

 

[Buzzer]

Raised taxes; 50% tax for the 1% top richest bracket.
Does this effect you?
Is this not a tax on the very people who can afford it, and have traditionally made up tax-dodges to avoid paying anyway?

Point 1. Labour broke a manifesto pledge.

Point 2. If, as you say, the filthy rich have avoided it in the past then they will avoid it in the future, n'est pas?

Point 3. the Institute for Fiscal Studies has raised serious doubts about this tax rise and predicts that it will actually have a net cost.

http://www.ifs.org.uk/publications/4486

This move is nothing more than a thinly veiled nod to the old guard class warriors like SimonSimon.

 

[Buzzer]

Cigarettes hiked; Large price rise on a pack of blunts.
Health-hazard aside, this is a 'luxury item' that no-one actually needs.
Many who indulge in it, don't even like smoking! They don't want to keep doing it. They do it habitually. It's unpleasant, affects other people around the smoker, yet they insist on smoking and paying for their habit.

Yes, they are a luxury item but who gets hit hardest with this tax? An NHS study found that the lower classes were the biggest smokers. So disproportionately a tax on the poor.

http://www.nhs.uk/news/2009/02February/Pages/Smokingwealthsex.aspx

Secondly, this filthy habit as you call it does not bother you at all now that smoking in public places has been banned. A non-smoker would have to go out of their way to suffer secondary smoking nowadays.

Thirdly, the tax is purely punitive. it's taxed disproportionately to the level of assistance that smokers receive in medical help and assistance in giving up. Smokers also pay more tax through greater insurance premiums and have lower life expectancies which reduces the cost of their pensions to pension companies.

Lastly, an addiction can never be called a luxury item. It's a contradiction in terms.

 

[El Presidente]

Lastly, an addiction can never be called a luxury item. It's a contradiction in terms.

[yt]http://www.youtube.com/watch?v=2ifK2iVInRk[/yt]

 

[Buzzer]

Beer tax increased; Average 3p a pint increase for instance.
So, how much can this mean to your evening out?
Say you consume 6 pints in an evening - let's be liberal and add 5p a pint.
30 pence more for your evening out.
You cannot drive after 6 pints anyway, so your consumption requires you pay for a taxi or public transport - so you already added a few pounds to those pints - but apparently didn't mind the fare home.

As with fags, tax on booze disproportionately affects the poor.
http://www.camra.org.uk/media/attachments/272900/Beer_Tax_Campaign.pdf

Last time the chancellor raised tax on booze he said it was to help stop binge drinking. Evidence suggests otherwise.
http://www.timesonline.co.uk/tol/comment/letters/article3541524.ece

Meanwhile the beer trade estimates that 36 pubs a week are now closing. It was 2 a week when the government took over. Those are real pubs in real communities with real staff losing real jobs. The pub is unique in British culture. This Govenrment's continual hammering of it is killing it. We all suffer.

http://www.axethebeertax.com/manifesto.aspx#name4

 

[Garage_Doors]

The Minimum Statutory Redundancy Payments weekly limit of £350 has been increased to £380 in the Budget.

Any one now when this is from ?, is it from immediate effect ?

 

[Buzzer]

Petrol increases;
This will hit the larger vehicle drivers most. Those cars and trucks that burn the most fuel, will require that the driver pay for that luxury and think about their need for it. They'll have to look at their journeys more than ever.
Smart cars and the new low-emission lower-fuel-using electrically enhanced vehicles will be a better buy for many people.
Environmentally, this should be a good thing, whether this government inadvertently indicate this or not. Tax reliefs already exist for fuel efficient cars, and punitive levies for inefficient vehicles.

Large trucks are commercial vehicles. Thought you might find this interesting:

The Road Haulage Association has warned Chancellor Gordon Brown that any Budget increase in fuel tax will cost British jobs. It will do further damage to an industry that is already paying much the highest level of fuel tax in Europe.
The handicap faced by British firms is highlighted this week by a new proposal from the European Commission. Brussels wants to raise the minimum diesel tax rate to €380/1,000 litres (or 38 eurocents per litre) by 2014. The tax rate in the UK is £483.5/1,000 litres, equivalent to 70 eurocents per litre.

"ALREADY, the tax in the UK is almost twice that of the EU minimum rate proposed for 2014. It is more than twice what many EU countries charge today. This is a measure of the problems faced by many British hauliers as they try to compete with foreign trucks," says RHA Director of Policy Jack Semple.

"Operators come into the UK with large fuel tanks and pay NOTHING to use our roads. In addition, our closest competitors – Netherlands, Belgium and France – all give hauliers an essential user discount or rebate on fuel tax. This helps hauliers from these countries to take work from firms which have no choice but to buy their diesel in the UK."

"Chancellor Gordon Brown recognized this as a major problem six years ago and promised to level the fuel duty playing field. Operators in Holland, Belgium and France are all given help to cover of the cost of fuel - while we, with the highest fuel duty of ANY country still wait for the UK government to give UK British hauliers the same consideration", he concluded.

http://www.rha.net/press-releases/rha-warns-gordon-brown-don-t-raise-fuel-tax/view

Meanwhile you haven't considered other essential road users. People like my brother who drives a taxi. Bus companies, disabled people who need their cars, rural road users.

And anyone who can't afford to buy a spangly new car. So the idea that anyone who has a 10 year old car can afford to buy a new one, even with the £2k allowance, is just silly. It works in Germany because car prices are lower and susrprise surprise tax on new cars is also lower in Germany. If it does work then the car hire firms, 2nd hand car firms and spare parts and garages predict that the skew it will have on the car trade could put lots of people out of business.

Once again, NMH, who do you think have the least efficient older cars? Yep - the poor.

 

[Paxton Dazo]

Put a pack of 20 fags up to £20, and a Pint of Lager down to £1. Perrrrrrfect.
Any smokers that disagree with this, stop smoking you MONGS.

 

[Buzzer]

Borrowing; 175bn announced.
Straight after the World leaders met to discuss maintaining a present and help to enable future growth - Britain borrows.
This was to be expected, wasn't it?
It is a recession, so what DID people expect?

No, no it wasn't. Just a few months ago in the Queen's speech Darling said that growth was going to be -1 % it's now predicted as -3.5% by the government and the IMF predict -4.1%

And let's just re-iterate. Add up all the borrowings Britain has EVER borrowed in it's history. Add it all together and it's less than this Government want over the next 4 years.

And this is based on a 3.5% growth in the economy by 2011 according to Darling. The IMF are predicting 0.4% decline in 2010

http://www.imf.org/external/mmedia/view.asp?eventid=1465

Based on the IMF rates compared to Darling's (who has not managed to get one prediction right about borrowing) Can you really see a 4% turnaround in one year? Of course not. Which means we will have to borrow more.

And to make things worse if the UK's credit rating is lowered the cost of borrowing increases even more! Double whammy.

 

[Chicken Runner61]

Buzzer

There is a lot of truth in all that you write but you know deep down there is nothing too bad in it. I suspect that if Darling & brown really thought we were anywhere near the end of this economic turmoil it would have been a lot more harsh on everyone.

20% vat and higher taxes for all must be on the cards in the next one.


If Brown & Co and New Labour are anything more than left wing tories I'm a chinaman.

i doubt that Cameon's degree in Greek Philosophy is going to pull us out of the shit as they are clueless too.

 

[beorhthelm]

im actually in favor of a 50% on over 100k tax band, you can afford to lose 10% if you are earning that much and for most cleaver people in that braket they'll avoid it anyway (often by having umbrella company and liberal expenses, so good for the lesuire and entertainment industry )

but taxing on ciggies and petrol is just a road to trouble. one day people will actually stop smoking and will actually stop using their car so much. then there will be a massive short fall in public finances. in the mean time, it make little dfferene and disproportionatly effects the poor for whom it is often (along with alcohol and mobile phone) their only luxury (if you consider getting to work conveniently a luxury)

 

[Buzzer]

From April 2011, pension tax relief for those with incomes over £150,000 will be restricted so it is gradually tapered to the 20pc rate.
Personal allowances are to be fully withdrawn for those with incomes over £100,000 from next April. Thus stopping the blatant scooping-up by such as bankers, who award themselves outrageous pensions

Where do I begin with this?

Firstly pensions are a long term plan. The market and pension schemes need to know that it's not going to get tinkered with because of it's need for long term planning. This will actually reduce pension funds, the economies of scale enjoyed by those funds and the ability to lend the Government money through purchasing bonds or buying compnay shares etc.

This is a clear disincentive for high earners to have pensions. You are now taxed on the income before you put into a pension, you are taxed on dividend income whilst building your nest egg and taxed on receiving the pension. What kind of message does this send to people? That the government doesn't value pensions. This is madness. 12 years ago we had a pension scheme that was the envy of the world. Not now.

I can't begin to stress how important pension schemes are to the market and to the British economy. This really is dangerous stuff.

 

[Buzzer]

Buzzer

There is a lot of truth in all that you write but you know deep down there is nothing too bad in it.

Really? I'm absolutely fuming at the madness of this budget. That's why I'm picking apart line by line all the bollocks that NMH has written. This is an absolutely awful budget. Really truly awful.

I'm gonna take a break but will answer the rest of it too.

Beorhthelm - the IFS study and classical economic theory (Laffer curves and all that) say that the 50% rate is tokenism. What would be effective would be a flat rate increase from 40% to 45% for all high earners. Tough on all of us but would actually raise money rather than this political gesture,

 

[NMH]

Point 1. Labour broke a manifesto pledge.

Point 2. If, as you say, the filthy rich have avoided it in the past then they will avoid it in the future, n'est pas?

Point 3. the Institute for Fiscal Studies has raised serious doubts about this tax rise and predicts that it will actually have a net cost.

http://www.ifs.org.uk/publications/4486

This move is nothing more than a thinly veiled nod to the old guard class warriors like SimonSimon.

1. Good, I'm glad they did. Why would you NOT think it was a good thing, unless you are one of the filthy rich?

2. In the budget, had you read it, Labour are closing down their ways of avoiding taxes, and cutting out their moneygrabbing via pensions.

3. Who cares who has 'serious doubts' about the budget. I have even more serious doubts that a.n.otherparty would have been more direct and sensible with a budget, or suited me AND YOU (begging questions of WHAT is in it for you to vote tory, they DO NOT REPRESENT YOU!

 

[Twinkle Toes]

Put a pack of 20 fags up to £20, and a Pint of Lager down to £1. Perrrrrrfect.
Any smokers that disagree with this, stop smoking you MONGS.

Fatal flaw in your argument alert!

If everybody stopped smoking as-from now: your Lager would immediately go up to about 20 quid a pint. Besides, all these lagered-up hooligans are costing the rest of society a fortune with their anti-social antics. I only have to notice a tin of Jaguar Lager in a supermarket (whilst I'm undertaking my low-wheel-emission-4-organic-drive-shop): & the next thing I know, I'm up in casualty assaulting hundreds of hospital staff!

 

[Buzzer]

NMH - Are you drunk man?

1. Because you keep telling me that it's the Tories that lie and cheat and double cross. And Labour are the honourable ones. And manifestos are supposed to mean something. You know. Trust. Honesty. Actually - it seems you haven't got the foggiest.
2. They avoided it before and they will avoid it again.
3. Are you seriously disregarding a professional and serious paper on why the tax increase won't work because a tory posted a link to it? You haven't even read it have you?

What's the point trying to debate when you've got your fingers in your ears and your head up Darling's arse?

 

[NMH]

No, no it wasn't. Just a few months ago in the Queen's speech Darling said that growth was going to be -1 % it's now predicted as -3.5% by the government and the IMF predict -4.1%

And let's just re-iterate. Add up all the borrowings Britain has EVER borrowed in it's history. Add it all together and it's less than this Government want over the next 4 years.

And this is based on a 3.5% growth in the economy by 2011 according to Darling. The IMF are predicting 0.4% decline in 2010

http://www.imf.org/external/mmedia/view.asp?eventid=1465

Based on the IMF rates compared to Darling's (who has not managed to get one prediction right about borrowing) Can you really see a 4% turnaround in one year? Of course not. Which means we will have to borrow more.

And to make things worse if the UK's credit rating is lowered the cost of borrowing increases even more! Double whammy.

No ifs and buts about you are there?
Time immaterial eh? These are times when larger amounts of money are bandied about, and so it's a bit obvious that higher figures are involved. Or do you REALLY live in the day when you were happily scooping up a whole £110 a week??
Time moves on Buzzer - try to keep up with it - like Darling apparently HAS done.
We will be borrowing more, that's already been said!
Here, from the Telegraph;

"Public sector net borrowing will be £175bn this year, 12.4pc of GDP. From 2010, it will be £173bn (11.9pc of GDP), then £140bn (9.1pc), £118 bn (7.2pc) and £97n (5.5pc).

- National debt as a percentage of GDP, including the cost of stabilising the banking system, will increase from 59pc this year to 68pc. It will rise to close to 80pc by 2013/14 - twice the level Labour inherited in 1997. The Chancellor expects underlying current budget deficit to come back into balance two years later.

- RPI inflation is forecast to remain negative, falling to minus 3pc by September, before moving back above zero next year."

So, what's your point?