Hoping for a rise in VAT on items costing 500+ pounds RRP

[DistinguishedSocialCommenator]

I was positing on another thread and came up with a way we in England and Wales could raise billions in tax revenue every years that could fund a better NHS HC and educating people for better HS etc, etc and better schools.

I would propose (Someone will now actually use this idea)
Raise VAT to 30% on every item that costs more than 500 pounds RRP to 30% and use the money towards NHS and education re better health for all. (Most washing machines, driers, fridges, tv's, sofas, beds, clothing, food, and eating out cost m a lot less that 500. A bit like the new tax that was introduced many years ago on cars costing RRP 40k plus

We've boguth cars easily surpassing the 40k mark, though the extra road tax hurts, we have a choice if to buy or not or buy a cheaper brand new car or a used car. Therefore, IMO, the above is a good idea and we can be flexible with the exact figures of extra vAT kicks in at xxx - RRP and the new could be slightly higher or lower.

AIBU as this will help all of us.

Agree.

"I am relatively sure the media and the politicians will air my idea as their own"

😂 😂

OP, your misplaced confidence is astounding.

Your "idea" is rudimentary, flawed, and just nowhere near as good / groundbreaking as you think it is.

Everyone is telling you so and yet you are responding as if you are getting good feedback.

Can I ask what you do for a career?

Are you a politician?

Are you Liz Truss?

Although, I have to say, you have a somewhat male arrogance about you....are you male?

@ohididntrealise thanks for the best laugh of the day

If they are in the 15% band and buy an item for £120 + £24 VAT(at 20%) and sell it for £160 + £24 VAT(at 15%) do they pass nothing on to the government?

The answer to “do they pass nothing on to the government” is “no, they don’t” as the whole point of the scheme would be to reduce the tax burden on small business, and increase total tax receipts by business growth and increased employment, rather than to get as much as humanly possible from each small transaction. It would recognise the particular struggles in staffing and investment that small businesses face. The aim is to stop the tsunami of business closures, not just because it’s devastating for individuals and communities, but because closed businesses pay no tax, redundant workers pay no tax and the landlords of empty properties pay no tax.

Businesses that are not registered for VAT don’t charge it, but they do charge pretty much the same for goods and services as VAT registered businesses so make a higher profit. Also, for lots of VAT registered businesses the VAT they charge and the VAT they pay aren’t the same because of the flat rate scheme. There aren’t a load of hospitality businesses all over the place charging 20% below what they good realistically achieve in the market because they are not VAT registered. It does make it hard to be competitive when you are up against a business who automatically keeps 20% more of their turnover than you do. The threshold encourages people to keep their declared turnover low by either being criminals or by being underproductive. As a pp said, if a business turns over £85k, they need to turnover £105k to make the same profit as soon as they tip over into being VAT registered. Why bother when you can just shut for January instead and HMRC gets exactly zero.

A variable banding would ably to the submitted VAT returns for that quarter, not a previous years turnover. It’s not a variable rate for consumers, it’s a variable payment for businesses. It would be complicated but tax often is and we manage with different rates for other taxes. If you, for example, turned over £80k in rateable goods in one quarter and the rate was set at £1k zero, £1-6k 8% and £10-20k 15%, £20-50 18% and £50-80 20% you would do your sums, arrive at just over £13, and deduct your VAT on what you have bought at 20% so if you had bought £10k of goods inc 20% VAT then you deduct £2k and send £11k to HMRC. You’ve saved £3k on the current system which for a lot of businesses in the current climate is the difference between staying open and closing down. Your supplier will have charged you 20% but they will have done similar sums and their overall VAT burden will be less. How much less depends on their size as a company turning over £50k a year will end up on a different overall rate than a company turning over £10million. This is already in existence with the flat rate scheme where the customer per is charged 20% but the business pays less, but the threshold for the flat rate scheme, like the zero rate scheme encourages under productivity. We need different thresholds and, frankly, a reduction in the standard rate. We already recognise that as a “sales tax” VAT is not applied equally to all sales. Its business dependent, not purely goods dependent. If I sell you a meal for £10 it’s not rateable. If I sell you 8499 meals for £10 each, it’s not rateable, if I sell you 8501 meals for £10 then it is rateable and I have a tax bill of £17k. I up my price to £12 to cover it and you go somewhere else where it’s only £11.50, but they only open 3 days a week and close from Christmas to Easter. For most basic goods from independent suppliers, consumers are unaware if they are being charged for VAT and how much of that charge will actually end up at HMRC. Someone just says “that’ll be a tenner please mate” and that’s the end of it. Even if you check and find out it’s a registered business, if that business is on the flat rate scheme then they aren’t passing over the 20% you think they are.

Someone talked about this on a phone-in radio
"Liz Truss" - I predicted IRL and another blog that Truss would either,
Bankrupt the country
Or, get us nuked by the sick Putin
I also predicted she would be gone in 4/5 weeks max - she went in 6 weeks and
two of those weeks on the back of our Queen Elizabeth, passing.

FYI, my OP is not set in stone and many good ideas in the thread what we could put the exta VAT on and what not to.
Even the RRP was an idea and it can be lower or higher. Judging by the comments, the RRP price set at 650 pounds and increased at the rate of inflation every year is a really good way forward

MN never fails to amaze with the economically illiterate coming along with their brainwaves. This thread is another gem.

OP, where are are you substituting a £40k car with one that’s £499. Do share.

OP is probably Diane Abbott.

OP is very grandiose. I’ve not read so much nonsense in a long time.

Just make it even harder for first time buyers then because white goods and finishing a property is expensive and you have to save for that as well as allows deposit and solicitors and convenient fees....

this wouldn't help the average Joe blogs it would just make things worse for them.

We need to tax the 0.1% tbh

If you had concentrated on the fundamentals of this thread and noted what I have stated, you would know that myself and all of my family would be impacted by my proposal of 30% VAT as everything we buy is often over that well over it other than the washing machine a couple of years ago that came with a free 5 year guarantee.

I don't like paying tax and even our 20% rate of income tax hurts but all of our children pay 40% income tax. You are allowed to have spending options if you are working hard and utilising your money prudently as we are.

To be CLEAR. This proposal will hit us hard, but something needs to be done to ensure we have a decent, streamlined NHS, alog with the security of benefits for those less able and the infrastructure of England.

So the 30% vAT impacts me and the family on almost every spend as per my OP.

Even these days you can get a decent washing machine sub 500
Gas hob, sub 500
Electic over sub 500
and many other items

You may have missed it but I've agreed with posters here who posted that car emchains should be expsmt and I said all services EG builders/decorator etc

The 500 pounds is not fixed, just a blal-park figure

So you still want to punitively tax my hearing aids, glasses and floor coverings as luxuries?

Having lived in a number of rented properties where they choose the cheapest white goods. It never works out in the long run. It pays to buy more expensive things which will last.

We rent out property and even our own washing machine with a free 5 year guarantee is sUB 500

You could buy a white goods item for 5k and some people do not look after it, so its no gurnatee

What you also failed to not as I have clearly sated many times in the thread - the 500 is just a figure that can be adjusted and as people come up with good ieads, those items can be exempt as well as medical aids/devices, just like some things are vAT exempt now

Unfortunately tiered consumption taxes don't really work.

Let's say I buy a 3 piece suite costing £1200. Am I really buying 2 armchairs costing say £350 each and a sofa costing £499.99?

You could contrive so many examples to show that it doesn't work.

It's just ill-conceived nonsense. And you really want to collect a 30% consumption tax in addition to the income tax that people have already paid?

No amount of money is going to fix the NHS, because that's not the problem.

This is an interesting concept.
So if you are a saver or worked to clear your mortgage you would get taxed more. And a spendthrift wouldn't?
Not sure I can buy into that tbh

@DistinguishedSocialCommenator

"We don't want Labour back in as trust me if you've got a bit of savings, own your own home and a private pension, you will be seriously hammered."

Seriously you want more of the crap we've had for the last 14 years from the incompetent, lying, corrupt Tories? They have wrecked public services deliberately.

You are either seriously confused about the posint you are trying to make or, deliberately obtuse about the VAT at 30%. I've made it clear the new VAT I'm posting about would hammer me and my family##The reason I don't want Labout is they despise success by ordinary working people like us and millions of others who have not only worked hard but saved, spent and invested well. Unlike those who try to run before they can walk.

I will never forget how the Labout lot was kicked out of the office and left that message that there was no money left in the kitty and we are still paying a price for that.

Every country needs a tax system but if you keep on kicking/hitting people and even those right at the top, even people will leave like they did - 83% tax, THAT RIGHT, people were paying up to 83% in tax so they left the country and in moved Thatcher,

I've said in my posts here before the politicians put themselves first, the big boys second and everyone else last and I stand by that.

The NHS has enough money, it needs streamlining as per my previous posts

Is OP a stalking horse for another shit Labour idea to take more of working people’s money?

The NHS and education need to be completely restructured. Throwing money at them, especially working people’s money, won’t solve the issues.

Why don’t they spin up a process improvement and business architecture programme to fix both? It’s so much simpler to just tax people more, but a restructure is what’s needed. Are there no innovative thinkers in politics in this country ?

150 billion and counting on giant a train set, just to cut (wait for it) 20 minutes off a journey between Manchester and London.

@Hereyoume it's amazing how you can quote two figures, both of them wildly wrong.

I suspect OP has already had a bottle of "the hot stuff" before starting this thread.

I believe you will agree with me 😂

@DistinguishedSocialCommenator

"I will never forget how the Labout lot was kicked out of the office and left that message that there was no money left in the kitty and we are still paying a price for that"

Whenever the government changes after a General Election they always leave a note to the next Chancellor saying that there's no money left. It's a standard joke every time.

Anyway after 14 years of the Tories the UK's finances are worse than ever. After their Brexit, austerity, Liz Truss etc. Things weren't better in 2019 before covid either. They have majorly screwed up and the sooner they are out of office the better.

I'm not the confused one.

@BatteryPowerGnat
Whenever the government changes after a General Election they always leave a note to the next Chancellor saying that there's no money left. It's a standard joke every time.

NO THEY DONT!!!!!!!!

@DistinguishedSocialCommenator the tories left a similar note in 1964:

Tory Reginald Maudling left a note to his Labour successor James Callaghan in 1964: "Good luck, old cock ... Sorry to leave it in such a mess" which has been taken to refer to the economy

That note is clearly different, it does not say they've left no money. People can leave things in a mess, but it does not mean there is no money.