What do you think of the 5% tax hike for those earning more than £150k - good or bad?

[soapbox]

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Good plan, KatieDD.

The sad thing is we don't even have any debts. Not even a mortgage.

But I'm liking the idea of time at home sorting out the garden and decorating.

What is bloody annoying is that Gordy is simply throwing the next election to Cameron because whatever the rights and wrongs of these proposals they undoubtedly look like the return of Old Labour.
It was the first thing Humphries said on Radio 4 this morning.
Labour spent years in the opposition wilderness for precisely this reason and if they're not careful they'll do it again.
Not a big Blair fan myself but there was one thing he knew well - the poor already belong to the left it's the middle classes who swing elections.
This policy will alienate not only all those who earn a high income but all those who aspire to. It will alientate everyone in the SE who know exactly how much they have to earn to buy a house.
And for what? I wouldn't fecking mind but it won't go anywhere near enough to make up the short fall.

Haven't read the whole thread but my thoughts are that it is fairly cynical electioneering, as it's not planned to come in until after the next election. I suspect that it may be atttractive to quite a lot of the electorate, many of whom will be blaming city high-flyers for the current mess we're in, rightly or wrongly. So seeming to hit them with a tax hike for the highly paid may be well-received.

That said, I'm actually not against a modest tax rise for all those very highly paid people who have all done very nicely thank you over the past decade or so.

Meanwhile, as someone pointed out on the news last night, £2.50 off a £100 spend is hardly going to salvage the economy.

Interesting Midnight that we thought the exact opposite .
In many ways I hope you're right because I couldn't bare to see the tories in power...despite the fact that I'm a greedy top tax paying high flyer.

I thought so too litchick . We'll see who's right. But I do think there must be a lot more low- and middle-income earners now fearful for their jobs looking at the bankers and thinking 'good' if they get walloped with a tax hike.

I'm interested in knowing more about the savings scheme they are promoting- if its any good why isnt it getting more coverage? likewise the small business loans scheme?

I am encouraged by the positivity of the reaction from the CAB spokesperson on the broadcast yesterday.

Midnight - you might be right.
If this is packaged as a pay back for the fat cats that got us into this mess it may very well appeal.

I completely agree with Twinklemegan that if people earning 150K can't figure out how to find the extra tax from their budgets then they must be rather stupid and should not be so highly paid.

Don't think this measure will save the economy and don't think people are greedy because they are high earners. Do however think that people are grasping and disgustingly materialistic if they really grudge the extra the tax. Also think that they are totally deluded if they don't think they are pretty damn well off.

Also agree with a lot of NMC points re the poor, and she is in a position to know.

It would be interesting to compare the expected revenue from this +5% tax to the monthly cost of sustaining military presence in Iraq.

In theory BeachC I agree with you...but if the Chancellor didn't pop anything by for a rainy day I don't suppose amny others have either.

But then isn't that the point of the savings scheme? To encourage the poorest to pop it back? I have to say I' be more likely to put aside the last pennies in order to get the 'interest' rewards they promised if it materialises.

This budget is going to make it a little easier for us- DH's company announced a freeze on incomes (delayed pay rise from Jan to April) and the fuel payments we will now receive will mean we can still pay the fuel bills without having to drastically trying to cut back further.

Peachy - yes I think the reduction in VAT may ease the burden a little but that's not the same as stimulating the economy.
Without wanting to sound like Thatcher I question the efficacy of trying to spend our way out of a recession.

There has to be some spending and I see it as part of a many pronged approach (not saying I am either an expert or that the Chancellor agrees!)

. preserve jobs- and yes spending helps that. shop / industry / etc can only function when there is money in circulation. In turn employed people are less of a drain in bebefits and contribute taxes. This enables other measure to be enacted.

. Get credit moving. I think more money in circulation would get some people borrowing again, BUT the banks need to lend. Not sure how the Chancellor can tackle that. There was some provision for small business credit put in motion though.

. Protect people at risk- the reposession thing, pensions rises, fuel payment for bonuses and the inclusion of sn ids in that scheme might help a little.

. Build a safety net. The savings scheme promised might help that, but there is a definite issue of people who do save feeling cheaed by the drops in interest rates when they ccue- I have heard quite a few people lamenting that the cautious lose out.

I think this budget is a good effort. It's sink or swim really and I don't think the Chancellor will hve risked his job- after all thats what it is- if he didn't have better than 50-50 hopes for this set of plans. The test is still to come.

I am furious that people earning £40,000 or more will be worse off as a result of current govt policy..that is not a large salary by any means particularly in the South East.

I also think the government are stupid to encourage people to spend more..they should encourage people to live within their means and save for a rainy day. If people were stupid enough to follow government advice they would go out and buy new cars etc and then find a few months down the line they lose their job and have no money to pay the mortgage and have their house repossessed. How is that going to help the economy.

It is also not good for the environment to keep buying items such as new mobile phones every six months and throwing the old ones in landfill.

if they give me a million i'll go out n stimulate the economy with it

Surly people are more likely to lose jobs if they dont spend a bit also?

Why would (pure examp[le) Asda need so many staff if they sold far less? Or a hairdressers?

All these are real people.

Dh's work wouldnt exist if there was nobody wanting to spend on a newspaper even though a newspaper is a luxury with the internet / libraries etc.

So what- another 500 people on the dole in Bristol with famillies? How would that help the economy?

I'm not going to read 14 pages! Anyone pointed out yet that if you earn 150k+ you are going to be one of the bigger beneficiaries of the cut in VAT? So you're still laughing? Or do they expect no-one to notice?

Actually people earning more than £19,000 are now worse off under these proposals.

Some people. We earn £19500 but with odd stuff are better off now.

Don't worry peachy - I do still buy newspapers as well as reading them online .

Always put them in recycling afterwards.

I've heard somewhere that Hairdressers do well in a recession as people still spend on having their hair cut to cheer themselves up!

It would be better if more jobs could be created in environmentally friendly ways..such as building better railways instead of a third runway at Heathrow. I personally hate supermarkets such as Tescos or Asda but know that the people who work for them as cashiers etc are salt of the earth..I doubt any would lose their jobs as people will still need food in a recession won't they?

Just wanted to say how much I'm enjoying this thread, particularly Wilf and Quattro's verbal and arithmetical sparring - good MNing, and generally very good humoured. MN is very fab sometimes.

Give me all your money!!!!

Surly people should definitely lose jobs.

I really like what the writer Malcolm Gladwell (author of Blink) is saying iin his new book:
Outliers doesn't laud the mega-successful so much as bring them down to earth. "I felt there has been a self-congratulatory strain in the culture where successful people justified their position on the top of the pyramid on the basis of their own great personal virtues. The principal proponent of the rags to riches myth was Andrew Carnegie, the second wealthiest man in human history. He went out of his way to say that only the poor had the wherewithal to become rich. Talk about a strategy for justifying his own achievement, and fighting off the income tax."

Utterly stupid, ridiculous and greedy to complain about a teeny increase in your tax when you are already rich.

'Surly people should definitely lose jobs. '