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Lower migration and the tax gap: raise taxes or ease restrictions?

260 replies

Mouldemort · 28/09/2026 12:50

James Cleverly introduced some serious restrictions on immigration, which Labour have upheld. Mahmood is going to introduce further restrictions. This has had the effect of reducing immigration substantially and forecast immigration (yes, even taking account the new method of counting.)

Immigrants, especially new immigrants, are disproportionate contributors to the UK's tax take, because they tend to be high earners and have no recourse to public funds. The low earners (who have mainly been blocked) are the bedrock of social care. The decrease in immigration has been more that the Chancellor planned for, so that leaves a substantial tax gap - at least £4bn and possibly £6.5bn annually.

Note this is from the Times, not a bastion of leftist thought.

So the question is, what do we do about this? Are you willing to pay higher taxes to pay for the shortfall? Should we lift restrictions on immigration to keep taxes lower?

Rejoining the single market or at least the customs union might help, but the same people who oppose higher taxes also oppose immigration and a closer connection the the EU

"Falling migration numbers could cost the chancellor as much as £7bn in fiscal headroom as he writes his first budget, The Times has been told. Government insiders believe that John Healey, who already faced an uphill battle to balance the books next month, is likely to have an even bigger challenge after immigration significantly undershot projections from the Office for Budget Responsibility (OBR). The Institute for Fiscal Studies think tank estimated last month that the success of Shabana Mahmood’s reforms, which have seen net migration cut to the low hundreds of thousands, could cost Healey some £4bn. Labour sources familiar with the budget process, however, said that the figure was now closer to £6.5bn. The OBR’s migration forecasts have been consistently higher than real numbers in recent years. Treasury officials, who have long expected Mahmood’s reforms to cause a hit to headroom, described the number as “pure speculation” but did not deny that Healey would have to contend with a larger funding gap than expected because of falling migration"

"At the same time, the OBR also observed that a ‘low migration’ scenario would – even after taking account of reduced pressures on public spending – push up borrowing by about £14 billion per year in 2028-29, considerably more than the cost of a 2p cut in National Insurance contributions, and raise the debt to GDP ratio – the government’s key fiscal target – by about 2.5%, or about £75 billion"

"In the short term, the biggest impact will be on social care, already struggling with workforce pressures and years of underfunding. Over the last two years, only a very large influx of migrant workers – 70,000 new starters in the last year – has saved the sector from an even deeper crisis. If the fall in visas issued is sustained, and there is not a large infusion of taxpayer funds, prospects are bleak."

https://www.thetimes.com/uk/politics/article/falling-migration-john-healey-headroom-zsw9rdcnr

https://ukandeu.ac.uk/immigration-is-falling-but-the-economic-cost-may-be-high/

Verifying Device

https://www.thetimes.com/uk/politics/article/falling-migration-john-healey-headroom-zsw9rdcnr

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EmeraldRoulette · 29/09/2026 18:12

Mouldemort · 29/09/2026 18:10

Have I had an answer from you?

Yes, two I think.

will probably not be on here again for a bit… I get in a really good habit of not being on here and then it gets broken when I’m trying to distract myself from other stuff lol.

currently trying to hide from boring chores….

Mouldemort · 29/09/2026 18:10

EmeraldRoulette · 29/09/2026 18:02

@Mouldemort “Change estate tax so that it's based on the recipients wealth and income, and not the size of the estate”

why? That’s a quick way to lose higher rate taxpayers.

is every idea you have about taxing people more? No ideas on saving money? We’re in such a ridiculous amount of debt.

Edited

Have I had an answer from you?

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EmeraldRoulette · 29/09/2026 18:02

@Mouldemort “Change estate tax so that it's based on the recipients wealth and income, and not the size of the estate”

why? That’s a quick way to lose higher rate taxpayers.

is every idea you have about taxing people more? No ideas on saving money? We’re in such a ridiculous amount of debt.

Mouldemort · 29/09/2026 18:00

@renovationchoas the solution to this problem is higher taxes to pay for social care, and higher wages for care worker.

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renovationchoas · 29/09/2026 17:57

Hi @RedTagAlan

the immigration minister was quoted as saying it at the Labour conference this weekend - that she had concerns that actually care workers would not remain in care work. Maybe she has withdrawn it, because I cannot find it on a quick google, but this is what she said. It’s borne out in the numbers - there’s little evidence that importing more workers has filled a skills gap in the long term. I would have no issue with a care worker getting a better, skilled job. I don’t think it’s cricket to work for 5 years, get ILR and then work cash in hand and claim benefits or go and do your 16 hours in Tesco and get topped up. This is what has been happening, unfortunately, because care is badly paid and that option exists for anyone. I don’t think this should continue to happen.

Mouldemort · 29/09/2026 17:56

nearlylovemyusername · 29/09/2026 16:51

You received many answers. You just don't like them and aren't prepared to try to understand.

There is no shortfall caused by continuing decline of immigration - current immigration, in particular 1.6m Boriswave getting settlements, will cause a huge spike in public spending and will require extra taxes / borrowing.

So if you tried to convince anyone that current immigration is good then you failed badly.
If you started a thread "How can we make UK attractive for highly skilled highly contributing immigrants" then the responses would be different.

You are projecting.

I've had some answers - pay more tax and cut benefits.Those people at least understood the premise. Low wage channels have been cut down tremendously. If you want lower immigration, it's working.

I was not arguing anything about immigration levels, just asking people to answer the question.

Immigrants who get ILR are less expensive than UK citizens. See if you can figure out why.

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RedTagAlan · 29/09/2026 17:47

Mouldemort · 29/09/2026 17:41

@DogsDinner you haven't answered the question. How do we pay for the shortfall in revenue?

I think Reform say "trickle down".

I think we need to wait for some nation and political party to get it to work, before reform put any effort into explaining it.

Mouldemort · 29/09/2026 17:41

@DogsDinner you haven't answered the question. How do we pay for the shortfall in revenue?

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RedTagAlan · 29/09/2026 17:28

renovationchoas · 29/09/2026 10:59

@Mouldemort

i don’t think our economy needs lots of people who work cash in hand in nail bars, or who work for 5 years in care, then get ILR and work in retail part time instead. The government’s own immigration minister has admitted that lots of people will leave care once they get ILR. It’s not sustainable.

This statement here you make. Quote-

"The government’s own immigration minister has admitted that lots of people will leave care once they get ILR."

I not saying you have to provide a link to that claim. I would be good, to check context and so on. But it would be good to know what immigration minister, when they said it etc. To give a starting point for where to fact check. Pedantic point I know, sorry.

Now the other bits of your post.

Quote " i don’t think our economy needs lots of people who work cash in hand in nail bars, or who work for 5 years in care, then get ILR and work in retail part time instead. "

Honest question. Do you have any idea of how difficult, and how expensive it is, for someone to get ILR ? I know people who have been through it. It is well into the thousands, My friend and his non UK DP... I think about 7k or something (anecdotal, depends on the process... lawyers or self. One couple done self, other couple used lawyers, the 7k is self)

The partners wages have a set minimum, the applicant has minimum wages, and all checked at a near forensic level.

These minimums were all set by May by the way (in the first instance), when she was home sec back in 2012 or so. Her argument was that she wanted to stop the "mail order partners". So someone (on benefits) could not head off to Thailand or Turkey, and come back with a spouse to live in a council house. What May done, in effect, is she made the entire concept of marrying a foreign national only available to the well off. So much for the concept of love eh ? Previous to May, spouse immigration was based on people being able to work in the world, fall in love and all that, and maybe settle in the UK at some point. She ended that for anyone but the rich.

People who come over on a visa and work in cash in hand jobs are not applying for LTR. They earn, contribute to the economy (in an illegal way) then head home.. with a bit of money. Because to get LTR, it is all checked.

NEAR EXACTLY THE SAME AS THE UK MIDDLE CLASS NOTION OF A GAP YEAR... SEE THE WORLD, WORK ON THE SIDE TO PAY FOR IT.

Not in every case of course, But what is the difference ?

To get ILR in the UK, the applicant needs to demonstrate they can contribute.

Anyway. When you say this " lots of people will leave care once they get ILR." Please think about what you are saying. Seems to me you are saying they should be stuck in a low wage job... instead of, you know.... earning more... and that means.... contributing more.

I am totally with @Mouldemort on this. Immigration is needed. For reasons Mouldemort explains. To change from that model needs higher taxes. And that is the proverbial blood from a stone it seems.

nearlylovemyusername · 29/09/2026 16:51

Mouldemort · 29/09/2026 16:25

If we can get this back on track.

It's not about your views on the criminal tendencies of asylum seekers, it's how you want to pay for the continuing decline in immigration.

If you don't have an answer to that, start your own thread.

You received many answers. You just don't like them and aren't prepared to try to understand.

There is no shortfall caused by continuing decline of immigration - current immigration, in particular 1.6m Boriswave getting settlements, will cause a huge spike in public spending and will require extra taxes / borrowing.

So if you tried to convince anyone that current immigration is good then you failed badly.
If you started a thread "How can we make UK attractive for highly skilled highly contributing immigrants" then the responses would be different.

DogsDinner · 29/09/2026 16:49

How do we get these immigrants who are not only net contributors now, but will be over their lifetime? The skilled worker visa is a joke, and was a travesty under Boris.

Governments don’t care. Short termism is their middle name.

DogsDinner · 29/09/2026 16:43

You’re taking it as read that immigration will solve the problem. I think people have been trying to point out that immigration will only work for 5 years.

Boris imported many millions of low paid immigrants, apparently to suppress wages and inflation. Now we could be supporting them to the tune of half a million each for the next 50 years. Over 2 million people, possibly.

Now you want to do the same to support borrowing.

That will work for 5 years as well.

Mouldemort · 29/09/2026 16:25

If we can get this back on track.

It's not about your views on the criminal tendencies of asylum seekers, it's how you want to pay for the continuing decline in immigration.

If you don't have an answer to that, start your own thread.

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MeetMeOnTheCorner · 29/09/2026 15:43

@DogsDinner Of course there is! Ask for documented proof of qualifications. It’s a sackable offence to lie about qualifications and the nhs needs to wise up. Any other employer would have dealt with this.

Mouldemort · 29/09/2026 15:38

Badbadbunny · 29/09/2026 14:15

Nor does British born. It's not the country, it's the culture. Those born abroad who are "like Brits" were born into British families/communities. Likewise, in the UK, we have British born people who don't speak English as they're in very restricted communities who show very little interest in integration.

I live in a minority ethnic area and it's polite and friendly.

It's the white British racists who oppose such people who are violent, brutish and a danger to women - not polite, kind and welcoming unlike my neighbours. I know who I think is more British.

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Badbadbunny · 29/09/2026 14:15

MrsBennetsPoorNervesAreBack · 29/09/2026 06:56

Yes, absolutely. Plus people like Joanna Lumley, Emma Watson, Prince Philip etc.

"Foreign born" doesn't necessarily mean what people might think it means.

Nor does British born. It's not the country, it's the culture. Those born abroad who are "like Brits" were born into British families/communities. Likewise, in the UK, we have British born people who don't speak English as they're in very restricted communities who show very little interest in integration.

DogsDinner · 29/09/2026 13:39

@renovationchoas

The nursing situation is appalling. Hospital departments were encouraged to set up contracts to only import nurses from abroad, often Philippines and Nigeria.

It has been acknowledged that we now have Nigerian nurses working in the NHS whose qualifications were faked. But apparently there’s nothing we can do about it.

DogsDinner · 29/09/2026 13:29

When it comes to care work, we should acknowledge that it can be a lot harder than other low paid work. But I think people would be happy to do it if the pay was substantially better.

I would suggest the government tops up the hourly rate to a level that attracts enough workers. It would certainly work out a lot cheaper than importing an immigrant and 2 dependents. Especially as they as they would likely just switch to other jobs as soon as they got ILR, as the government has acknowledged.

renovationchoas · 29/09/2026 13:28

@DogsDinner

lots of nurses graduating from the U.K. without posts….terrible way to plan an economy

DogsDinner · 29/09/2026 13:18

The OBR actually estimated that each low paid immigrant (and each dependent) would cost the country almost half a million pounds by the age of 80 (average life expectancy).

Over the next 5 years, we are possibly about to grant full access to state support to 1.6 million (could be more) mostly low paid immigrants. Does anyone think the country can actually afford this?

We have plenty of people to do these jobs already. I know this is anecdotal, but my experience is that competition is brutal for these jobs.

nearlylovemyusername · 29/09/2026 13:14

renovationchoas · 29/09/2026 12:56

@Mouldemort

Everything you have said is just wishful thinking. If you actually look into the economics of immigration using proper government statistics, the OBR evidence and of independent think tanks like the Migration Observatory. Every family worker brought in by a care worker costs an average of £115k over 30 years. Skilled migration of high earners is totally different and a net positive. When you read into it, you’ll realise that almost none of the costs of migration are priced into official GDP statistics - additional use of infrastructure and public services and increased resulting public spending and costs of retirement are all not priced into official statistics, because the government funds it all too difficult.

Exactly.

And the problem is that UK isn't attractive for many high earning high flyers anymore. Our own high potentials and wealth creators are leaving.

Even this thread is typical - which taxes to raise or whom to import to pay for shortfall. We need to review the reason for shortfall and make it go away.

nearlylovemyusername · 29/09/2026 12:59

Change estate tax so that it's based on the recipients wealth and income, and not the size of the estate.

Yeah, sure - I work hard and earn so my parents estate will be taken to pay for benefits, incl immigrants. I sit on my arse with depression and bingo, I get my inheritance.
So glad you are not in charge of our taxes. Although to be fair, those who are at present aren't much better

renovationchoas · 29/09/2026 12:56

@Mouldemort

Everything you have said is just wishful thinking. If you actually look into the economics of immigration using proper government statistics, the OBR evidence and of independent think tanks like the Migration Observatory. Every family worker brought in by a care worker costs an average of £115k over 30 years. Skilled migration of high earners is totally different and a net positive. When you read into it, you’ll realise that almost none of the costs of migration are priced into official GDP statistics - additional use of infrastructure and public services and increased resulting public spending and costs of retirement are all not priced into official statistics, because the government funds it all too difficult.

Mouldemort · 29/09/2026 12:25

The "government statistics tell us low paid workers are expensive later" is simply not true, because the contribution of low-paid workers isn't just the tax they pay, and a large proportion of their "costs" are children - new workers for the economic mill. Immigrants are less likely to claim benefits that native-born citizens.

As for how I would pay for this. I'd allow more immigration.

However, that's not happening, so I would:

Collect more of the £59bn of uncollected tax.

Cut the asylum management bill by allowing asylum seekers to apply at British consulates, and for those who have arrived irregularly let them work straight away while their cases are being heard.

Change estate tax so that it's based on the recipients wealth and income, and not the size of the estate.

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renovationchoas · 29/09/2026 11:40

@Mouldemortit’s not implied contempt - it’s a reality that this type of immigration is not sustainable if you want to have improved public services, which depends on GDP PER CAPITA population growth. I’d prefer that we paid people in care more and made it a role that could be properly trained for from 16 at college when funding is available (one of the big barriers in care is that U.K. domestic carers will need someone to sponsor them through relevant qualifications after 18, so it is cheaper to hire from elsewhere and pay less wages for individual care businesses, but more expensive for society - it’s a misalignment that has nothing to do with how I feel about carers on an individual level. In fact, I think it is people who want to import carers from abroad and not fix the conditions or training that I think have contempt for care. I do have contempt for businesses that operate in the black economy though!

I’ve already answered your question though - I’d happily pay a small tax that makes up the tax gap, on the basis that we will have fewer people whose housing benefit and pension credit will need to be funded down the line and will get very expensive later, so it is a future saving. It’s a temporal thing, as government statistics tell us these low paid workers are very expensive later. The government’s own immigration modelling does not actually model the cost of migration over a lifetime, only the first 5 years. Taking people in and taking their immigration fees for 5 years, only for that benefit to society to unwind and be overtaken by costs in the next 30 years is a Ponzi scheme. Unfortunately for the government, the decision to extend ILR has meant the government actually have to model and discuss it - Shabana Mahmood has already admitted it will cost a lot of money to the taxpayer not to extend ILR for the Boriswave (which is why she said yesterday that it is about balancing fairness to the individual against fairness to society - the fairness to society is an admission that we are going to be paying for this).

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