Tax Increases after Corona

[lemongrassmartini2021]

Anyone have any ideas what tax changes we might see post Corona. Increase in income tax? Inheritance tax? VAT? Corporation tax? Stamp Duty?

Obviously no one knows until there is a budget announcement but just wondered what people thought.

I think there will be an increase across all of them and also council tax etc will go up too. Hopefully they won’t bump things up too much though or there will be many who will struggle to pay for the basics.

Yep.

At 80% GDP debt already

• Covid

• Brexit short/medium term effect

• ageing population + increasing cost of Social Care

• state infrastructure projects

We’ll be paying this off for decades

This will not be paid for by little changes at the margins. I wouldn't be surprised if there was some kind of windfall tax. 5% of everything over 50K, say, held in savings accounts. Greece had a similar windfall tax a few years ago when they were in the shit.

Taxing people more isn’t going to help the economy. The US run at over 100% debt to GDP.

They may go the other way initially to encourage spending. The banks are cutting rates to virtually zero on savings so it may force people down the investing route or spending route.

They’ll have to tax the ones with the wealth in property - the Baby Boomers basically. Rightly so in my opinion as they generally didn’t have enough kids = not enough tax payers now.

@mummypop

Thats a nice idea but I think there will be too much resistance to that idea from the masses to ever get that through!

Indeed, so you’ll probably see hikes in IHT to even include those who bought their own Council Houses & so on. Anathema to the Conservatives but the only way out as far as I see.

They could start closer to home. Scrap HS2 for one. £80bn cost. Scrap Trident £40bn cost.

The bank bail out cost over £130bn.

At the moment it is still manageable. Another month or so wouldn’t make much difference.

I'm hopeful on the vaccine from Oxford, London. Hopefully all goes well with that vaccine and it looks like it will be the vaccine that will reach us quicker than other vaccines because I think they were working on it since MERS. Someone correct me if I'm wrong.

Countries and governments will be paying millions if not billions for such a vaccine. Hopefully it will help at pulling the UK out from a recession/depression.

I read that they may scrap the state pension triple lock, plus make the 25% personal pension tax free lump sums taxable

It’s unlikely they’ll increase stamp duty, they’re going to want to kickstart the housing market so might even stop it for a couple of years. Income tax, VAT will go up. Hopefully they’ll be much more aggressive in taxing the tax evading corporates.

Triple lock is likely to go. Pre election the idea of tax relief being capped at 20% on pensions was floated.

They've said for years that they might remove the tax free element of the PCLS.

I think they will increase stealth taxes and avoid income tax hikes wherever possible.

Pensions - likely

VAT - likely

IHT - possible

Trouble with IHT and pensions is they’ll hit their core voters hardest.

Scrap the pension triple lock and tax capital ahead of income or spending.

“ Rightly so in my opinion as they generally didn’t have enough kids = not enough tax payers now.”

Didn’t have enough kids? Have you looked at the UK born population lately?!

Tax Wealth.

Confiscate all inherited wealth on the death of the inheritor.

The triple lock will certainly go.

I think it's quite possible that there will be a haircut on bank accounts.

Income tax hike across the board, plus hike in IHT.

Lowering the Vat threshold to bring more businesses into it, this was mooted a few years ago under Hammond but didn't happen. Also increasing the rates of flat rate Vat for various industries.

The pensions triple lock has to go as it is getting exponentially more unaffordable as the years go on. It has to be scrapped at some point and they have a good excuse for tackling it now. VAT increases hammer businesses but it pulls in a lot of money and the average member of the public doesn’t really ‘see’ the increase in VAT as much as they would an increase in income tax. That said I think we ought to put up the basic rate of tax too. It has been much too low for much too long.

That said I think we ought to put up the basic rate of tax too. It has been much too low for much too long.

Absolutely. We're all in this together!

i think tax rises are inevitable. Nearly £300 bn deficit, fivefold what was expected pre-covid. The treasury has (quite rightly) borrowed. The debt needs to be serviced, and there are a lot of things to pay for and benefits that can't be cut jsut yet so there will be immense pressure to raise tax revenue.

Unfortunately I think the working majority and those trying to raise a family will be shafted again in favour of the wealthier boomers...

Income tax is an easy way to raise the most revenue. It won't be the top 45% bracket, because each percentage point increase does not raise as much as the other brackets and you will lose many high earners abroad.

In theory it would be best to go for wealth, windfall, capital gains and inheritance taxes. The lockdown really highlighted the inequality here. It affected the poorest, homeless and younger most adversely - those starting out in jobs, those in front line jobs, those trying to raise a family. It benefitted the wealthiest and the oldest most. Obviously these are hard to enforce and opposed heavily by Tory types; the wealthiest squirrel away assets in trusts and offshore and second properties etc. Then there are also problems for genuinely cash-poor e.g. Londoners who own a house that grew in value but can't actually cough up the tax payment unless they sell their only home.

Not corporation taxes as i doubt Tory have the political will to do that (and also companies provide jobs)

Not SDLT because they want to support the housing market

VAT unlikely, when they want to stimulate spending and a recovery, but maybe later down the line or on selected goods and services

As far as I can see, Boris is fucked whichever way he turns.

I think that the fact that our PM is essentially a man who has undergone a Damascene conversion, i.e. he's not the same man who led the Tories to victory, will force an election sooner rather than later.

“ Confiscate all inherited wealth on the death of the inheritor.”

I think a lot of people, including doctors, would stop work if this happened. If you’ve got savings and pension and you think anything you leave you will go straight to the state, why earn it?

I suppose you could give your kids money before but didnt Corbyn propose preventing that?

Mums got a neighbour paying for their second unplanned grandchild. If they weren’t helping out, it would just be another family on the housing list.

People think the basic rate of tax is too low?!

I read somewhere that the banks might take on the debt so that over time it gets eroded by inflation or something?