UK VAT drop vs Australian Method...

Solari · 7 Dec 2008 at 22:45

So McBroon drops VAT instead of dropping income tax to put more money in our pockets...

Has anyone else seen how the Aussies are dealing with it?

I was quite shocked watching the news the other night and seeing that to stimulate the economy and retail sales, they are doing the following:

Australian Daily Telegraph said:
From Monday, pensioners, carers, seniors and veterans will receive one-off payments of up to $1400 over a two-week period. About 3.9 million families will also receive payments of $1000 for each child in their care.

But obviously there are concerns that it'll be spent on..... this

Lucky sods!

Pilky01 · 7 Dec 2008 at 22:47

The reason VAT was cut instead of a drop in income tax or anything is that the government wants us to spend money, not save money which is what would have happen if income tax was cut.

Solari · 7 Dec 2008 at 22:48

Pilky01 said:
The reason VAT was cut instead of a drop in income tax or anything is that the government wants us to spend money, not save money which is what would have happen if income tax was cut.

Personally I'd have been more inclined to spend with the extra money in my pocket. 2% of a mundane item makes sod all difference so it doesn't make me want to spend. 2% extra in my pay packet is a fair bit more so I'd be prepared to treat myself with the extra disposable income... but horses for courses..

Pilky01 · 7 Dec 2008 at 22:50

Solari said:
Personally I'd have been more inclined to spend with the extra money in my pocket. 2% of a mundane item makes sod all difference so it doesn't make me want to spend. 2% extra in my pay packet is a fair bit more so I'd be prepared to treat myself with the extra disposable income... but horses for courses..

2% is to little to have any impact, but with the threat of redundancy and raising prices most people would have saved incase they do lost there jobs

mattheman · 7 Dec 2008 at 22:51

2% vat cut is nothing, rather have income tax cut.

Dazzy_G · 7 Dec 2008 at 22:54

should have done both.

JBuk · 7 Dec 2008 at 22:54

Pilky01 said:
The reason VAT was cut instead of a drop in income tax or anything is that the government wants us to spend money, not save money which is what would have happen if income tax was cut.

I would spend it

although probably not on beer

Pilky01 · 7 Dec 2008 at 22:54

Dazzy_G said:
should have done both.

I think we are in enough debt already

JBuk · 7 Dec 2008 at 23:02

Pilky01 said:
I think we are in enough debt already

the economy is based on debt, the more the better!

Pilky01 · 7 Dec 2008 at 23:03

JBuk said:
the economy is based on debt, the more the better!

The government being in the amount of debt it is going to be soon is not good.

JBuk · 7 Dec 2008 at 23:11

Pilky01 said:
The government being in the amount of debt it is going to be soon is not good.

the government/country will always be in debt, thats how the system works

look up "money as debt" on youtube for a better explanation

Pilky01 · 7 Dec 2008 at 23:14

JBuk said:
the government/country will always be in debt, thats how the system works

look up "money as debt" on youtube for a better explanation

I know that the government will always be in debt, I have a good understanding of economics, and I think that getting into as much debt as Darling has planned is going to be bad for the countries economy

Solari · 7 Dec 2008 at 23:29

I wonder how many countries actually have a surplus right now... ie: no National Debt. :confused:

SKILL · 7 Dec 2008 at 23:30

Although the VAT cut was designed specifically to increase spending (which I really can't see it doing, but it might, you never know) I still think an alteration to income tax to actually give people more cash would've been better. This is because there is only 3 things they could do with that money:

Save it - gives banks more capital, they'll be more inclined to lend, a good thing
Spend it - retailers get more profit, happiness ensues
Pay off their debts - Again a good thing

Energize · 7 Dec 2008 at 23:36

Solari said:
So McBroon drops VAT instead of dropping income tax to put more money in our pockets...

Has anyone else seen how the Aussies are dealing with it? I was quite shocked watching the news the other night and seeing that to stimulate the economy and retail sales, they are doing the following:

But obviously there are concerns that it'll be spent on..... this

Lucky sods!

Wow that's pretty bad, at least the vat cut gave something to everyone whereas this gives no help at all to people under 60 without kids. I can just imagine all the chav families being given $10,000 for having so many kids.

SKILL said:
Pay off their debts - Again a good thing

Less debt = less money in the economy!

Andy100 · 7 Dec 2008 at 23:43

Solari said:
I wonder how many countries actually have a surplus right now... ie: no National Debt.

I know Australia has a surplus although for how much longer I'm not sure.

I seem to be one of the few people here who's not getting a government handout! :mad:

The_Abyss · 7 Dec 2008 at 23:47

Solari said:
I wonder how many countries actually have a surplus right now... ie: no National Debt.

Norway. Some $200 billion in surplus.

Kemik · 7 Dec 2008 at 23:48

Solari said:
I wonder how many countries actually have a surplus right now... ie: no National Debt.

China. Massively cash rich country.

Solari · 7 Dec 2008 at 23:57

Andy100 said:
I know Australia has a surplus although for how much longer I'm not sure.

I seem to be one of the few people here who's not getting a government handout!

Looking at the news over here, they seem to be scrapping and deferring a lot of initiatives/projects so it looks like things must be getting tight!

The Mad Rapper · 8 Dec 2008 at 00:06

Energize said:
Less debt = less money in the economy!

Yes, but then you can really stick it to the Man!

Debt is the new religion IMHO - a modern twist on keeping the masses subjugated.