Emergency Budget 2010 - Page 2

jaysay · 23-06-2010, 09:51

Quote:

Originally Posted by Bernard Dawson

Absoloutly right. VAT is a regressive tax which hits the poorest hardest.

It speeks

katex · 23-06-2010, 10:25

Quote:

Originally Posted by Bernard Dawson

Absoloutly right. VAT is a regressive tax which hits the poorest hardest.

Certainly going to hit me Bernard. I know they are going to increase the personal allowance for income tax to £7,475 to soften the blow to the lower income earners. Saves them £170 .. but is overtaken by increase in VAT.

For me, as a pensioner over 65 .. the personal allowance is set at £9,450 anyway; this already covers no income tax being deducted from my state pension, however, now have small income and the 2.5% increase in VAT will certainly hit me and put lots of goods beyond my reach.

At least no rise on me fags, alcohol and fuel.

Neil · 23-06-2010, 10:34

Quote:

Originally Posted by Bernard Dawson

Absoloutly right. VAT is a regressive tax which hits the poorest hardest.

I don't understand why that is the case, please could you explain it?

katex · 23-06-2010, 10:34

Quote:

Originally Posted by flashy

this bit amused me endlessly

Child grants: restrict the sure start maternity grant to the first child only, abolish the health in pregnancy grant. Expect lone parents to look for work when their youngest child goes to school.

this might actually STOP people popping kids out just to stay on benefits

It bemused me Flashy rather than amused me ... I thought the idea was to encourage people to have more children in order that they contribute to the system and help support the longer living pensioners ?

Also, the bit about lone parents is a little amiguous ... hmmm .. is this a warning that there is more to come on this ?

Bernard Dawson · 23-06-2010, 10:41

Quote:

Originally Posted by katex

Certainly going to hit me Bernard. I know they are going to increase the personal allowance for income tax to £7,475 to soften the blow to the lower income earners. Saves them £170 .. but is overtaken by increase in VAT.

For me, as a pensioner over 65 .. the personal allowance is set at £9,450 anyway; this already covers no income tax being deducted from my state pension, however, now have small income and the 2.5% increase in VAT will certainly hit me and put lots of goods beyond my reach.

At least no rise on me fags, alcohol and fuel.

As you say Kate, not everyone will benefit from the shift in personal allowances. But almost everyone will pay VAT.

cashman · 23-06-2010, 10:57

Quote:

Originally Posted by katex

Certainly going to hit me Bernard. I know they are going to increase the personal allowance for income tax to £7,475 to soften the blow to the lower income earners. Saves them £170 .. but is overtaken by increase in VAT.

For me, as a pensioner over 65 .. the personal allowance is set at £9,450 anyway; this already covers no income tax being deducted from my state pension, however, now have small income and the 2.5% increase in VAT will certainly hit me and put lots of goods beyond my reach.

At least no rise on me fags, alcohol and fuel.

Wait while Autumn kate it'll come.

flashy · 23-06-2010, 11:22

Quote:

Originally Posted by katex

It bemused me Flashy rather than amused me ... I thought the idea was to encourage people to have more children in order that they contribute to the system and help support the longer living pensioners ?

i know what you're saying Kate but people do keep having children to stay on benefits, there is no getting away from that fact, yes i am a single parent, yes i am on benefits for now but i didnt have a kid every other year just so i could stay on benefits longer

MargaretR · 23-06-2010, 11:27

Kate - our tax allowance for over 65s is currently £9490, not £9450.
I gather that it will go up by £1000 too - I hope I have understood correctly.
I currently pay about £600 a year in income tax on my civil service pension, so I will only pay about £400, which is £16.66 less tax in a month to me.

MargaretR · 23-06-2010, 12:16

PS - It seems I was wrong.
I have found this -
Budget: 700,000 more taxpayers in highest tax band | UK news | The Guardian
There was no word on personal allowances for pensioners. Currently, those aged 65-74 enjoy a personal allowance of £9,490, while those above 75 have an allowance of £9,640. Sources suggest that pensioners will have to wait until the autumn for an official announcement on allowances.

Margaret Pilkington · 23-06-2010, 12:52

Quote:

Originally Posted by katex

Certainly going to hit me Bernard. I know they are going to increase the personal allowance for income tax to £7,475 to soften the blow to the lower income earners. Saves them £170 .. but is overtaken by increase in VAT.

For me, as a pensioner over 65 .. the personal allowance is set at £9,450 anyway; this already covers no income tax being deducted from my state pension, however, now have small income and the 2.5% increase in VAT will certainly hit me and put lots of goods beyond my reach.

At least no rise on me fags, alcohol and fuel.

Well, Kate, all these things will go up as a result of the increase in VAT......cigarettes by about 13pence a pack(or that is what the newspaper says).It would have been easy to cut the benefits bill by bringing in a rule which says that if a child isn't born and/or resident in this country, then child benefit is not payable. I am sure this would have met with the approval of most people....it would take very little to administer it either.

The VAT increase will hit everyone.......but that way no-one escapes.
I know that it will make a very little dent in those who earn lots of money, but there may be other things that will appear in the autumn budget that will sting the folk who have pots of money.

katex · 23-06-2010, 13:23

You're right about £9,490 .. was a typing error.

What I was saying was that there is no cushion for me on a low income, and the rise Barry talked about happens anyway. The new rise linked to earnings may be very little more as pays are frozen which will depress earnings inflation. So, buying essential expensive goods and services, which I find difficult these days, will take them out of my pocket. The gap widens between rich and poor. The new rise will help the big earners too don't forget who can afford essential services without effort, even with the VAT increase.

I don't like freezing wages either for public sector workers over £21,000 for two years. Doesn't help with any incentives to work well.

Mind you, this is happening too in the private sectors as government budgets are being cut.

mattylad · 23-06-2010, 17:07

Perhaps those public sector works need another incentive?

Like keep coming to work accepting this pay freeze & you may get to keep your job.

The alternative is to cut jobs.

katex · 23-06-2010, 17:14

Quote:

Originally Posted by mattylad

Perhaps those public sector works need another incentive?

Like keep coming to work accepting this pay freeze & you may get to keep your job.

The alternative is to cut jobs.

Yes, you have a good point there Mattylad and sure our nurses, paramedics and police will carry on as normal.

Just hope it doesn't persuade them to take their talents into the private sector or abroad.

Bernard Dawson · 23-06-2010, 17:17

Quote:

Originally Posted by mattylad

Perhaps those public sector works need another incentive?

Like keep coming to work accepting this pay freeze & you may get to keep your job.

The alternative is to cut jobs.

Big job losses in the public sector are inevitable. The Government are talking about 25% cuts across some departments.

DaveinGermany · 23-06-2010, 17:48

Quote:

Originally Posted by Bernard Dawson

Absoloutly right. VAT is a regressive tax which hits the poorest hardest.

I personally think it's the best option from a bad lot, at least with VAT everyone, without exception gets taken from, working, non working, those living on handouts, even tourists & people working illegally. It's take that or would you rather specific groups get hammered to carry thousands of sick lame & lazy ?

As to Katex's point, according to demographics & politicians the Country needs Children, to cover the costs of a longer living older generation, how ? Until the kids are of working age they also take up the countries resources. Still having said that even when they reach working age 18-20 years down the line there is no guarantee they will get work. Take a look round at some of the youngsters now or even their parents in some cases, unemployed /unemployable immaterial of it's through choice or lack of opportunities. where shall the money come from ? The reduced workforce with more obligations ?

No the VAT includes everyone, as to it being fair or not well the individual decides how much they pay by their spending habits, chuck it round like a sailor on shore leave & the Government creams it in, stay frugal, do you really need a 9ft telly, all the latest gadgets & fashions ? Choice is yours.

As to chuntering on about the increase wrecking the Economy I don't see how, People adapt, always have done always will do. Germany hiked its VAT in 2007 from 17% to 19% Guess what Germany is still functioning, admittedly there were the doom & gloom mongers inferring Economic collapse & Germany being pushed back to the dark ages etc,etc, well how about that it didn't come to pass ! For the first 6 month or so people griped & spent a little less, then Summer came & things picked up, no big deal.

I say give it time & you'll probably find things will work out.