[Politics] Would YOU be happy to pay more income tax so OAPs could keep their fuel payments?

[Machiavelli]

There’s a £22 billion hole in our country’s finances that has to be filled somehow. So would you be prepared to see your income tax go up (let’s say by 2% on every band), so that pensioners not claiming pension credits (including those who currently donate it to charity) keep their WFP?

I would by the way. I’ve always believed those with more can and should pay more.

The British public have long been keen on either keeping spending levels as they are or, increasing public spending/taxation as is increasingly the case. What they're not keen on is lower taxes which also means lower public spending. See:

BSA 40: Role and responsibilities of government | National Centre for Social Research

Have voters attitudes changed in respect to the role and size of government?

natcen.ac.uk

It really hasn't been mentioned much but as Chancellor Hunt reduced NI by 2p twice, which has had a major hit on the public finances. It's that (alongside the mess he/they left behind: verified by the IFS and OBR) provides the context for the WFP withdrawal.

 

[golddene]

Hear hear! As a pensioner who will be losing the winter fuel tax, I'm fully in favour of raising income tax by a penny or two in the pound, not to re-fund the fuel allowance for me, but to help mend all the things in the country that need to be mended.
And I do pay tax, so I'm not just asking for other people to pay more tax! (the state pension is not taxable, but it does use up virtually all of the tax-free allowance; I top it up with a couple of small work pensions, which are taxed)

The same as you 49er, we here are now pensioners, though Mrs G only received her OAP last Christmas when she reached 66 so was one of the first waspie women who had to wait full term, as it were, to get her pension so though I could have managed without the benefit of WFA it came in useful as we were in effect living on just my OAP For the past four / five years, I count myself fortunate as the company I worked for enrolled me into their final salary scheme at age 18 and contributed far in excess than I did during my employ with them and when I became redundant to them after 27 years this FSS became a defined benefit scheme which gave me an annual pension of £13k, £9.5k after tax deduction, I also receive around 13k state pension which is again liable for tax as the personal tax allowance freeze combined with the annual pension increase means this payment takes me above the threshold for tax even though I claim the allowable married persons 10%tax allowance from my wife’s allowances.

Give the money to those who most need it and anything left should be used by the Government to improve all our lives along with further tax increases, our health service, education, schools infrastructure, roads, transport, etc etc are desperate after 14 years of thievery and neglect. We are in this together, so let’s hope everyone tightens their belts where possible and contributes to the long way back financial mess we find ourselves in. And don’t get me onto PIP and other non means tested benefits which no matter if you are a pauper or billionaire you can still claim with no tax etc to pay on it ?

 

[Cheshire Cat]

Has anybody specified exactly what this alleged £22bn gap is made up of?

Government is all about choices, so stopping the fuel benefit is a political choice. Could there have been different choices? What other savings were considered and rejected? How much were they? Why were they rejected? Why was the fuel benefit deemed an acceptable choice compared to other choices that could have been made? Why is the choice of increasing income tax sp politically unpalatable? Why does the Labour government feel compelled to follow the former Conservative government funding plans?

If the Labour party in government is going to be merely the Conservative government lite, why bother?

Very not impressed so far with them. I wasn't impressed with the previous mob either.

 

[Thunder Bolt]

Don't be so sure ...

It would not be too difficult to combine the Electorol Roll register, where household cohabitation data is held with the HMRC CESA and DCDM systems. OSA won't allow me to elaborate but HMRC definitely have the data to be able to generate a household income figure using PAYE and SA data and DCDM would get pretty close to getting an individual's asset wealth worth.

I'm personally not aware that such a system already exists (above my security clearance) but to say "no database" exists may not be entirely correct.

I was often taken aback by the level of data capture / data matching that HMRC do to be aware of our individual financial circumstances.

The Winter Fuel Allowance is payable per household, not per pensioner, so a single occupant would get £300, and a married couple £150 each.

 

[The Clamp]

There’s a £22 billion hole in our country’s finances that has to be filled somehow. So would you be prepared to see your income tax go up (let’s say by 2% on every band), so that pensioners not claiming pension credits (including those who currently donate it to charity) keep their WFP?

I would by the way. I’ve always believed those with more can and should pay more.

Absolutely not. Pensioners have had it too good for too long.

 

[Weststander]

Read the first page but not the others so apologies.

No, I wouldn't want to pay more tax just for WFP for 'all' pensioners. Like all benefits (apart from the basic pension itself) I believe they should be means tested.

With regard to the WFP, I agree in principle with what Labour have done except for where they have fixed the cut off point which I think is too low and excludes too many that actually do need the payment. That said, the 800,000 that are entitled to but don't claim pension credits need to apply. As Martin Lewis pointed out on tv the other day, getting pension credits opens the door to a host of other benefits and his view was along the lines that even if pension credit only gets you a couple of extra quid a week, it's worth it for the other benefits that come along.

And the average pension credit award alone is greater than £3,900 per annum , well worth others claiming it too.
https://www.gov.uk/government/news/pension-credit-what-you-need-to-know--2

 

[Weststander]

Taking away subsistence from vulnerable, sick people isn’t the answer here - redistributing the existing wealth in this Country is.

Taxation is the primary tool used by any government to redistribute wealth according to their ideological perspectives. For Labour, it will be making the taxation system work better for those less well off and closing the loopholes that wealthy, small businesses and offshore corporates take advantage of to avoid paying tax.

There was a £35 billion gap in tax payments last year of tax that should be paid by corporation/businesses but was not. To put this current debate into perspective, the winter fuel payments for all pensioners costs £2 billion.

There is plenty more this Government can do to redistribute wealth before cutting the benefits you list above to the most needy in our society. That includes higher rates of capital gains, Inheritance tax, higher rates of stamp duty on second homes, higher rates of the upper thresholds of income tax, windfall taxes across all utility sectors being used to reduce consumers’ bills (especially in the energy sector).

Even without targeting the very wealthy, most decent people in this country are prepared to pay more taxes for better services and to help care for the very vulnerable in our society because most of us are actually, at the end of the day, very decent in this Country and we care for others.

However, that compassion should NOT be tested by asking people to help those that frankly don’t need it - there is nothing more damaging to people’s goodwill than seeing their hard earned ‘tax dollars’ being taken from them and given to help people better off than they are.

There are a number of wealth redistribution measures in the manifesto but it would be unrealistic to expect them all to be implemented in the first 5 months of a new Labour Government :

https://www.moneysavingexpert.com/news/2024/07/labour-wins-election-keir-starmer-money/

£8.5b of the tax gap is stems from individuals.

 

[Zeberdi]

£8.5b of the tax gap is stems from individuals.

Maybe but that’s not even a quarter of the £35 billion shortfall in tax owed to tax collected.

However, I‘m saying close the loopholes that all UK taxpayers (including wealthy individuals) use to avoid tax or evade it illegally with offshore tax havens - It makes sense to close the corporate loopholes (and make paying National Insurance compulsory so people don’t need to top up the shortfall in State Pensions with pension credits). (NI is payable btw on means tested increments (and those on benefits are exempt) so people avoid it because the contributions are voluntary not because they can’t afford to pay them.

From Gov.org

• the largest components of the tax gap by tax type are the Corporation Tax gap and the Income Tax, NICs and Capital Gains Tax gap, both at a 34% share, followed by the VAT gap with a 20% share of the overall tax gap
• the tax gap from small businesses is the largest component of the tax gap by customer group at a 60% share in 2022 to 2023; the tax gap from wealthy and individuals each make up a low proportion of the tax gap at 5% each in 2022 to 2023

As of June 2024:

‘The UK’s tax authority has not fined a single “enabler” of offshore tax evasion or non-compliance in five years despite landmark powers introduced in 2017, new figures reveal.

Industry experts criticised HMRC’s approach as “bizarre” and “bloody pointless” in light of the data, which was released under freedom of information laws to the Bureau of Investigative Journalism (TBIJ).

HMRC fines zero ‘enablers’ of offshore tax evasion in five years

Experts say authority is failing to punish the architects of tax-dodging schemes while aggressively pursuing their clients

www.thebureauinvestigates.com

 

[Weststander]

Maybe but that’s not even a quarter of the £35 billion shortfall in tax owed to tax collected.

However, I‘m saying close the loopholes that all UK taxpayers (including wealthy individuals) use to avoid tax or evade it illegally with offshore tax havens - It makes sense to close the corporate loopholes (and make paying National Insurance compulsory so people don’t need to top up the shortfall in State Pensions with pension credits). (NI is payable btw on means tested increments (and those on benefits are exempt) so people avoid it because the contributions are voluntary not because they can’t afford to pay them.

From Gov.org

• the largest components of the tax gap by tax type are the Corporation Tax gap and the Income Tax, NICs and Capital Gains Tax gap, both at a 34% share, followed by the VAT gap with a 20% share of the overall tax gap
• the tax gap from small businesses is the largest component of the tax gap by customer group at a 60% share in 2022 to 2023; the tax gap from wealthy and individuals each make up a low proportion of the tax gap at 5% each in 2022 to 2023

As of June 2024:

‘The UK’s tax authority has not fined a single “enabler” of offshore tax evasion or non-compliance in five years despite landmark powers introduced in 2017, new figures reveal.

Industry experts criticised HMRC’s approach as “bizarre” and “bloody pointless” in light of the data, which was released under freedom of information laws to the Bureau of Investigative Journalism (TBIJ).

HMRC fines zero ‘enablers’ of offshore tax evasion in five years

Experts say authority is failing to punish the architects of tax-dodging schemes while aggressively pursuing their clients

www.thebureauinvestigates.com

I believe in the entire tax gap being squashed. Not just the billionaire or multinational.

I can't think of a moral argument that goes against that. £9.5b per annum is huge.

 

[Professor Plum]

As far as I’m aware, no one has suggested raising income tax to restore the WFA. The main suggestion has been to find a way to withdraw the WFA from the wealthiest pensioners (like me) while continuing it for the rest, including the millions who aren’t well off but aren’t poor enough to claim a welfare top up. Martin Lewis suggests not paying it to those in the top council tax bands. If that’s fairly easy to administer I’d be in favour of that. We really don’t need the £500 we previously got in this household (2 of us). It was welcome of course but it really wasn’t needed. For other pensioners it’s a vital winter top up.

 

[Professor Plum]

I understand the uproar the cutting of winter fuel allowance has made but also know of some pensioners that ain't happy about it because it means they don't have it now as a bonus to help pay for a trip away or holiday.

Honestly, I know no pensioners who have that attitude. I know a lot of oldies through local clubs etc and there’s a general feeling that it’s a ‘nice to have’ but not a ‘must have’ for most of us. I haven’t heard anyone grumbling about not having a holiday bonus— I’m afraid that sounds like a bit of intergenerational banter. But plenty of people think the WFA should be restored for pensioners who are genuinely struggling.

 

[Zeberdi]

As far as I’m aware, no one has suggested raising income tax to restore the WFA. The main suggestion has been to find a way to withdraw the WFA from the wealthiest pensioners (like me) while continuing it for the rest, including the millions who aren’t well off but aren’t poor enough to claim a welfare top up. Martin Lewis suggests not paying it to those in the top council tax bands. If that’s fairly easy to administer I’d be in favour of that. We really don’t need the £500 we previously got in this household (2 of us). It was welcome of course but it really wasn’t needed. For other pensioners it’s a vital winter top up.

That is not what we are saying - you are missing the point.

Billions of tax revenue are lost each year through tax evasion and tax avoidance.

See the bigger picture people,

 

[Professor Plum]

That is not what we are saying - you are missing the point.

Billions of tax revenue are lost each year through tax evasion and tax avoidance.

See the bigger picture people,

No I’m NOT missing the point. I’m directly answering the question posed in the poll FFS.

Maybe the thread has veered off into a general moan about tax evasion (I’ve not read it all) but that isn’t what the OP was canvassing opinion on. So wind your whiney neck in.

While I’m at it, be careful about distinguishing between tax avoidance and tax evasion. They’re radically different. A big proportion of our savings are in ISAs which are 100% legitimate tax avoidance schemes. You can deposit up to £20K a year and pay no tax on ISA savings, the idea being to encourage and incentivise people to save money.

Tax evasion is totally illegal and these people should be held accountable.

 

[The Clamp]

Honestly, I know no pensioners who have that attitude. I know a lot of oldies through local clubs etc and there’s a general feeling that it’s a ‘nice to have’ but not a ‘must have’ for most of us. I haven’t heard anyone grumbling about not having a holiday bonus— I’m afraid that sounds like a bit of intergenerational banter. But plenty of people think the WFA should be restored for pensioners who are genuinely struggling.

Well, they’re out there. And they’re laughing at us.

Winter fuel payment: We spend it on holidays, say some pensioners

Some pensioners say they don't need the extra cash of up to £300 - and want better means testing.

www.bbc.co.uk

 

[Robdinho]

Not all pensioners will receive £460 as I understand it .....doesn't that only apply on the state pension as of 2016....

...then your point as to the £460 ...so net £160....... so increase in energy bills....potentially rent ...council tax etc...hmmm

My point was why do pensioners deserve a guaranteed above inflation pay rise every year, when large portions of society are struggling and public sector workers have had their pay effectively frozen for a decade.

My comment about the £460 increase was slightly flippant, really just pointing out that this is presented as pensioners losing money, when in reality it is just a smaller increase.

 

[Weststander]

That is not what we are saying - you are missing the point.

Billions of tax revenue are lost each year through tax evasion and tax avoidance.

See the bigger picture people,

Tax gap. Ascertained some reliable official figures.

2009/10 £35b or 7.9% of what should’ve been collected.
Now, £35.8b or 4.9%.

If 14 years of Labour rule struggled to close the gap, I wonder why it’s fraught?

But encouraging to see the % fall. I think IT enabled targeting, plus believe or not Osborne closed tax avoidance schemes through DOTAS and other legislation.

 

[The Clamp]

I honestly think people are so used to lies from the Tory’s that they think Labour must be up to something.

Nope. They’re not lying. Millions of pensioners receive a benefit they simply don’t need.

For the tiny minority that can’t afford to heat their homes. Help is there for them.


Relax. The Tory’s have gone. This is a government working for you.

I realise that’s hard to believe after 15 years of lies. But it’s true.

And as harsh as it may sound to some, everyone has to pay their fair share to get this country back on track.

We’ve had years of pensioners selfishly voting for Tory’s. Sorry oldies, now it’s time to help out for a change.

 

[Professor Plum]

Well, they’re out there. And they’re laughing at us.

Winter fuel payment: We spend it on holidays, say some pensioners

Some pensioners say they don't need the extra cash of up to £300 - and want better means testing.

www.bbc.co.uk

No they are not laughing at us, according to that BBC report you linked to. Those pensioners are saying precisely what I’m saying — that for many pensioners, the annual £250 was just a bonus that we don’t need, and that just gets channeled into general income. Better that it goes to those who need it most. No one is laughing at you. Well, not on this topic.

 

[Greg Bobkin]

It is billions, not millions.

It's still not gonna save that much. Maybe £19m, but not 22

 

[Bodian]

The Winter Fuel Allowance is payable per household, not per pensioner, so a single occupant would get £300, and a married couple £150 each.

£300 if one is over 80. Only £200 for the 66/67-80 brigade.

Three million over 80, 8million under - but I don't know the household split.