The Budget™ 2009

[atpbx]

A woeful and inept budget from a government that just keeps on making itself less and less credible by the day.
It helps no one, it doesn't even start to address the problems with the economy, Its as If Darling forgot it was budget day today and threw this half arsed mess together on the bus on the way into work this morning.

 

[antijoke]

So £300 million will be set aside for the motorist wishing to participate in this scheme, how much is £300 million divided by £2,000.

 

[platypus]

So £300 million will be set aside for the motorist wishing to participate in this scheme, how much is £300 million divided by £2,000.

Is that a serious question? 150,000; which would be a significant boost to the new car market.

 

[Barks]

Ironically cutting tax could be far more effective than the car scrappage scheme. Giving people more disposable income would no doubt increase demand for cars. Taking income off the sort of people who go out and buy cars brand new will reduce demand. Such a ridiculous Budget.

 

[antijoke]

Yes it is a serous question, I am having a mental block,must be a little Kim Jong Il in my head blocking out maths equations.

Yes it would be for 150,000 motorists, which considering the below statement doesn't seem all that impressive (if only I could find the stats for average age of car on UK roads).

"Currently the vast majority of cars are still on the road at 10 years old. Indeed at 14 years old, half are still on the road," said Professor Glaister of the RAC Foundation.

And as already stated, is the type of person running around in a 10 year old car + really going to be able to afford the expense of buying a new car anyway?

EDIT: What is the CO2 impact going to be of scrapping all those 150,000 cars?

 

[ElliorR]

So £300 million will be set aside for the motorist wishing to participate in this scheme, how much is £300 million divided by £2,000.

Actually the government is only contributing £1000 and the car industry contributes the other £1000 and also has to pay for the disposal of the old car. It has already been said thatno car manufacture could afford to take another £1000+ off the cost of a car without either scrapping all deals that people make when they go to buy a car at the showroom, or put the prices up to compensate for the £1000+.

Doesn't sound so good once all the nitty gritty comes out.

 

[Glaucus]

Actually the government is only contributing £1000 and the car industry contributes the other £1000 and also has to pay for the disposal of the old car. It has already been said thatno car manufacture could afford to take another £1000+ off the cost of a car without either scrapping all deals that people make when they go to buy a car at the showroom, or put the prices up to compensate for the £1000+.

Doesn't sound so good once all the nitty gritty comes out.

ha-Ha classic, same old spin from a retarded government.

 

[muon]

Subsidising cars isn't really very smart. A proper general equilibrium analysus burden of tax/subsidies will tell you that.

Out of curiosit, how long is it for?

 

[elroberto]

That 50& tax rise will raise less than a billion. Or 1/12th of the cost of the VAT cut. Pointless. They are toast. It's a good thing the election's not tomorrow or they'd struggle for 3rd place. Will be interesting to see what pre-election bribe they offer in 12 months time. If they make it that far, that is.

 

[muon]

That 50& tax rise will raise less than a billion. Or 1/12th of the cost of the VAT cut. Pointless. They are toast. It's a good thing the election's not tomorrow or they'd struggle for 3rd place. Will be interesting to see what pre-election bribe they offer in 12 months time. If they make it that far, that is.

Wouldn't be a tax cut otherwise would it

 

[Von Smallhausen]

A fantastic budget ...... as it is the final nail in Labours coffin.

The present Government has lost all direction.

50% income tax rate will raise very little and hand the Tories a booby trap when they take office as they are the party of lower taxes and have a support base amongst the more well off and will be expected to reverse it.

It is a sure sign to me that Labour know they are holed below the waterline. Let us see how many rats desert the ship.

 

[ElliorR]

That 50& tax rise will raise less than a billion. Or 1/12th of the cost of the VAT cut. Pointless. They are toast. It's a good thing the election's not tomorrow or they'd struggle for 3rd place. Will be interesting to see what pre-election bribe they offer in 12 months time. If they make it that far, that is.

There is no chance whatsoever of Labour winning the next election unless the Tories and Lib Dems are all exposed as paedophiles. An even if that happened I think Labour would still be worried about losing.

 

[elroberto]

There is no chance whatsoever of Labour winning the next election unless the Tories and Lib Dems are all exposed as paedophiles. An even if that happened I think Labour would still be worried about losing.

Don't give Labour's spindoctors any ideas!

 

[antijoke]

Don't give Labour's spindoctors any ideas!

Maybe he is one.

 

[Barks]

You say that but there a lot of thick people who will believe whatever they're told.

 

[platypus]

Ironically cutting tax could be far more effective than the car scrappage scheme. Giving people more disposable income would no doubt increase demand for cars. Taking income off the sort of people who go out and buy cars brand new will reduce demand. Such a ridiculous Budget.

I'm not sure it would in this specific case. Giving people more disposable income would not necessarily make them then buy a new car, whereas offering this incentive specifically for buying a new car..

Subsidising cars isn't really very smart. A proper general equilibrium analysus burden of tax/subsidies will tell you that.

Out of curiosit, how long is it for?

A year, from May to May 2010. And the reasoning is obviously based on an increase in car sales, which would yield a greater return in tax then the £300 million set aside for the scheme, not to mention the boost to the UK car industry.

I agree though overall it's ludicrous.

 

[scorza]

Isn't a 50% tax rate for high earners what the Lib Dems have been calling for for a while now?

Whatever though, raising the tax burden on lower earners would be economic suicide.

 

[MooMoo444]

robin hood at it again, stealing from the rich and giving to the poor

is the tax on lower earners changing any? more? less?

 

[Barks]

Why not reduce VAT specifically on cars then? The scrapping scheme just seems overcomplicated.

At the risk of sounding controversial, it's as if they want poor people to suddenly start going out and buying brand new cars. In the mean time, the typical sort of people who do go out and buy new cars (and regularly for that matter) are getting taxed more. If anything they should bloody well be persuading the wealthy to go out and buy new cars. Whilst I appreciate that's not exactly "fair" it'd be far more effective to be quite honest. There is absolutely no argument whatsoever against the simple fact that if you reduced direct taxation on cars (VAT) their consumption would rise. A lot of people would also use the savings from the lower VAT rate to invest more in the car.

There are hundreds of ways they could boost car consumption and this budget uses one method which is just ridiculous.

 

[platypus]

Strangely enough though, it really has worked in Germany and France. They saw an increase of 40% in new car sales (from the BBC article), and that is a considerable boost to their ailing car industry.

The larger problem of course is that the UK car market generally works one way. We import to buy, and we export to sell.