Tax increases imminent

[Iwishicouldflyhigh]

Heavy hints that taxes will rise in the next Budget after the recent climb down (as the ‘taxes won’t rise again’ was based on a 5 billion saving in benefits).

I can’t lie, I’m so pissed off about this. I don’t think anyone wants to see someone who is genuinely unable to work to be further penalised, but we all know there are thousands of people who could work but don’t.

this country is going to absolute shit . We pay more and more for less and less.

VAT is a regressive tax and curtails growth.

Hits the poorest hardest...

Won't happen, is totally against Starmers "Broadest shoulders" promise.

It's reality of the numbers. Increasing taxes by small amounts on huge numbers of people brings in more than massive tax hikes on a tiny number of "rich" people.

We still have, overall, lower taxes than many countries in Europe.

We have more inequality than other European countries. Higher earners are taxed in line with Europe it's lower & middle that pay more elsewhere.

There isn't the tax base to raise all the money we would need.

Not when it hits consumer confidence it doesn't.

Small amounts are relative, to you or i, they may well be, for millions on or just above NMW, they are unaffordable and may well mean higher in work benefits.

We need tax rises just to stand still....

It was the mid 80s when private pensions were encouraged and SERPS was introduced. That's 40 years ago. So people retiring today have had most of their working life to make their own arrangements. You can lead a horse to water but you can't make it drink.

No there isn't, which is why tax increases cannot be allowed to hit growth, which things like VAT increases will do.

A 1% hike in VAT, at most raises 6/7 billion, less if people cut spending.

Not if we had economic growth but you need a government that doesnt hate business to achieve that!

And let's not forget, some of them will have paid little or nothing if they've "earned" credits by virtue of being on certain benefits, a carer/parent or working part time just above the threshold to qualify but below the threshold to actually pay NIC.

Not if we had economic growth but you need a government that doesnt hate business to achieve that!

@taxguru does any government know how to achieve this? What would you suggest? I'm stumped.

They cannot go for workers and reassessing top band houses is both expensive, takes time and there is already a semi crash happening at the top level of housing due to interest rates, non doms/rich leaving. You can’t have a housing crash when you have promised to build and also it can trigger a financial crash too. They also can’t mess with the volatility on the gilts- although there is stuff they could do there to decrease volatility which is rather urgent.
A penny on VAT is the simplest fix - that is why my bets are on that.
The tax the wealthy ideas have actually cost us billions. And lack of investment.

So why didn't we get growth under the Tories? Wasn't Sunak pro growth? Hunt the entrepreneur chancellor!!

Growth has actually, marginally, increased under Labour, only US and Canada is higher - G7.

Anyway, Labour had no choice but to raise taxes, if not NI on business, which ones would you have increased?

paul Johnson from IFS is clear that for scale of funds needed they have to go for VAT, income tax or worker NI…all else is a fiddle.

The voters seem to care more about immigration than anything else. According to the ipapet the French have started slashing small boats in shallow waters and the Home Office will crack down on UberEats etc. paperwork issues for recently arrived illegal immigrants. If they can get some grip on the black economy that would save billions!

1% on VAT doesn't raise anything like enough, we need around 30 billion, that would raise 6/7 billion or less, should spending drop, which it would do & hit growth.

One could argue that lowering VAT would increase tax take and boost consumer confidence, increasing growth....

They already froze tax bands and went for NI which also hurts workers. So VAT it is.

Sunak hated small businesses. He was only interested in huge multinationals. That's part of why 3 million freelancers/small businesses were excluded from the covid support schemes.

x.com/PJTheEconomist/status/1941062171372527669

Err? all the sole traders i knew got £10k lump sum..... only those who didn't have the book work got nothing...

Even though in all cases, they carried on working, after the initial ban but many ignored that.

As a friend, carpenter said "Money for nothing"

people seem to casually dismiss the fact that Labour ran, very very clearly, on no tax rises.

It is not nothing that this turns out to be a lie. What is the value of democracy if when in power, politicians go back on what they said in their manifesto? Democracy is nothing, worthless, if the politicians are not representing what people voted for.

There should be no question of them raising taxes, that is not what they were democratically elected to do. If there is no
money, then they literally have to do spending cuts, that is their option, that’s it. Anything else is an insult to democracy.

IF.... IF growth is down graded....

They already froze tax bands and went for NI which also hurts workers

The Tories froze bands, labour kept it.

We need lots of small changes.

1% on income tax
1% on VAT
Remove pensioners exemption for NIC if they're still working
Change free prescriptions from 60 years to state retirement age
A new higher band for council tax
Scrap the state pension triple lock

The way the media pick up and blow up every small thing means it's impossible for any political party to make big changes anymore.

We need to move to lots of small, incremental changes. Chip away around the edges for year after year. It's what the Tories have done over their 14 years - lots of things that barely made the front pages but brought in increased tax revenue.

people seem to casually dismiss the fact that Labour ran, very very clearly, on no tax rises.

True but they will argue they had no idea re the scale of the problem and their proposed cuts have been rejected.

No I don't want a Trump but I want someone a bit ruthless.
Everyone can't have everything - which is the present mindset. So nothing can be cut, taxes can't be raised, immigrants are coming across the channel in their thousands - we must be the laughing stock of the world with that. Other countries, Australia, Netherlands, US seem able to sort it but not us.