Tax!

[Cian]

If they had to bring in VAT on it because of that they could have done it at 0.1% surely? 5% is a rather high "we're being forced, sorry..." figure.

There's plenty of items which are VAT applicable in Ireland and are zero rated in the UK. Condoms, magazines spring to mind straight away.

 

[Conkers]

I would rather pay 62% VAT and no income tax and no NI

Same here, considering i'm a saving/investment ADDICT.
Not sure it would help the economy. Somebody looks at a TV and thinks "ohhhhh, that's cheap for £499". Whack 62% VAT on instead and the same person (at the same tv) "ohhhhh, that's expensive. It's £672!!!!"

 

[Bisto]

Electric and Gas is set @ 5% The rate of VAT is set at a percentage and this can be set at 0% as in many business situations. There is a great move by all govs, to indirect (hidden) taxation and we all become a little 'de-sensitised' to it.
If you think about it there are lots we pay without thinking to hard such as road / bridge tolls, congestion charges, TV licence, residents parking permits, council garden waste collection, meetings with public officers (planners etc), air travel surcharges, and so on

 

[Seagull on the wing]

Personally I think I'd prefer to see less income tax and more tax on purchases, road use etc.

That way at least you get to see more of your salary and it's up to you how you spend it.

On the other hand the stupid TV licence fee should be dropped immediately and the amount added to income tax. The TV licence is NOT an option as every household has a TV. And the cost of administering and enforcing the TV licence must be astronomical.

Not quite true.I know 3 families that don't have TV,there must be many more,but I a that it is a zany tax.gree

 

[Bisto]

At least with high VAT (and stricter border controls) less people would be able to use tax loopholes to avoid tax and the blackmarket economy would end up paying something back into the state.

Those who save only become liable for tax when they spend

And inheritance tax would then appear a fairer tax

 

[fork me]

VAT is only charge on luxurys. So your poor rich thing is bollox. How many 'poor people' have a playstaion 3 for example?

Luxuries? This is one of the most clueless things I've ever seen written here.

Let's look at some of those "luxuries".

All clothes and shoes, except childrens clothes. Are clothes a "luxury"? Do poor people not wear them?
Fuel, including household gas and electricity.
Washing powder, soap, toiletries, bleach - hell, all cleaning products.
ALL furniture, including furniture for children.
All toys.
Even over the counter medicines have VAT charged on them.
The list is endless...

In fact the only things NOT taxed are food (but not ALL food - biscuits, for example, are subject to VAT, which is why McVities went to court to prove that Jaffa Cakes are cakes not biscuits!), children's clothes, books, newspapers, magazines and stuff for disabled people. Just about everything else is subject to VAT.

 

[fork me]

Electricity & gas are zero rated.

No, they're not, they're charged at 5%

 

[Conkers]

Ahhh yes the Jaffa cake debate. Every tax course i've been on had that case mentioned. Not forgetting the M&S tea cake one too!

 

[sten_super]

No, they're not, they're charged at 5%

Yes sorry I got listed it the wrong way round. Electricity & gas are 5% and water is zero rated.

As mentioned VAT is part of a wide range of indirect taxes that have slowly replaced direct taxes over the years. I'm sure they could very easily make tax much more straightforward but there is no political will for it - probably because we'd all then realise quite how much of our income is paid in tax!

 

[Lord Bracknell]

I wonder how many people actually paid 83% or 98% ? Many rock stars avoided tax on their royalties by channelling it into a company registered in a tax haven. Company executives used accountants to exploit tax loopholes.

About 750,000 in 1974, apparently.

http://www.ifs.org.uk/bns/bn25.pdf

Another way of avoiding paying tax at the higher rates was, of course, to take advantage of the availability of tax relief on mortgage interest (without an upper limit). The answer to the question "What would you do if you won a few million on the football pools?" was "Borrow lots of money to avoid paying tax".

 

[Lord Bracknell]

I wonder what the idiotic growth in football transfer fees is doing for the economy. With 20 per cent VAT applying, this can only be a good thing for the economy, no?

 

[Cian]

Luxuries? This is one of the most clueless things I've ever seen written here.

Let's look at some of those "luxuries".

Because of this post I just checked a UK receipt, I did a fairly big shop in a shop in Northern Ireland that actually VAT codes its receipts (OK, its Lidl...). They do the same down here

Down here generally the only things coded as C on their receipts are alcohol and biscuits/cakes/sweets

In the UK, there's VAT on toilet roll, washing powder, fruit juice, etc.

I think I'll stop moaning about paying VAT on magazines then!

 

[matthew]

EU and inefficiency is the problem

 

[withdeanwombat]

We need VAT because of the massive value that is added to purchases by,say,the taxman.

 

[Giraffe]

And take home pay was hit from April

 

[beorhthelm]

as i understand it, once a VAT rate has been set, EU legislation prohibits it being removed and it can only be reduced temporarily. this is to prevent reductions being used as a competitive advantage within the single market. i recall Brown in one budget had a sensible idea, to remove the VAT on building works for churches (and charities?). few days later the proposal was dropped after lawyers had noted the conflict with EU legislation.

as a tax it makes quite alot of sence, if you limit its scope. excluding food as we do makes it sort of work, though other items should probably be 0 rated too. while it doesnt only apply to "luxuries" it is charged proportionally: if i buy a £20 pair of jeans i only paid £3.44 VAT, if i buy a 100 pair i paid £20 VAT. in the absence of ration books with tokens for an allowance of essentials, i dont know how VAT can be fairer, unless its removed altogther. then we'd just taxed more on income instead.

 

[larus]

Anyone remember the days when graduated scales of income tax went up as far as 83 per cent? AND there was a surcharge of a further 15 per cent on investment income - making the marginal top rate 98 per cent?

Those were "the good old days", of full employment, free education (including student grants) and universally available affordable housing, of course. Terrible times.

Ahh; those good old days when unions went on strike if workers got sacked for sleeping on night-shifts when they were meant to be working. When the miners kept trying to hold the country to ransom.

It is widely accepted that penal rates of tax encourage higher tax evasion. When income tax was reduced by Thatcher, the money flowing into the exchequor increased.

The typical left-wing view is always 'tax the rich'. They always want someone else to pay. We need to encourage entrepreneurship to generate more wealth for the country; the public sector only takes from the private sector. It doesn't produce anything to generate wealth for the country, so bloating the public sector, quangos, councils etc may reduce unemploiyment, but it's all got to be paid for by what the private sector generates.

 

[fork me]

the public sector only takes from the private sector. It doesn't produce anything to generate wealth for the country,

An absolutely stupid comment, and only vaguely true if you only look at thoings from a direct "money" perspective.

The public sector, through education, provides the private sector with the qwrokers it needs, from the most highly speciailised right down to the basic like being able to read and write.

Through the health sector it ensures the workforce is capable of working.

Through various other services it ensures the road network works so that the private sector can actully move its raw materials and products around, it removes their garbage and provides the regulation to ensure that electricity, gas and water are supplied to its factories and offices.

The public sector also provides the legislature that the private sector often relies on.

The private sector couldn't exist without a public sector.

 

[Mistasita]

it is quite simple , but rather depressing , there are about 0.2 % of the population who have the real money and power ,they want to keep it , so the rest of us go around the taxation treadmill in order to maintain the system.
TAX is inevitable, whatever way you dress it up we probably end up with about 10p in every pound earned that is not touched by any kind of TAX.... You have to try and let it wash over you or it could drive you mad.