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This. I really can't believe anyone is surprised. It'll get a lot worse than 20% VAT.
VAT is going up to 20% say government
- Thread starter bulldog147
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This. I really can't believe anyone is surprised. It'll get a lot worse than 20% VAT.
Gold was at it's lowest price for decades when sold. It was Gordon Brown's illusion of "No more boom and bust" that made him think it would go down further... much to his surprise (and not a surprise at all to everyone else) we were just having a bigger than normal boom, and now a colossal bust.
The question comes back to essential and discretionary spending. Most truly essential spending is zero rated or taxed at 5%, the rest is all discretionary, and potentially avoidable.
There are a few things that should change (I disagree with VAT on petrol and diesel on top of duty for example), but in general, it's a pretty good analogue to the level of discretionary spending a taxpayer does, which is (or perhaps should be) determined by their income.
Given how much spending has been fueled by personal debt the last 13 years, reducing discretionary spending a little might not be a bad thing...
In an ideal world, I'd prefer to abolish sales taxes apart from for externality reasons, but they can't be replaced with direct taxation, only by dramatic reductions in spending and scope of the state which would never be tolerated at present.
you are right, i'm just saying its all too easy to critisise after the event, don't forget Labour were elected mainly on their intention to increase spending on public services, so at the time, it was probably similar to privatiseations under Thatcher, Major etc. It goes without saying though that spending was way too high and Brown should have known better
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Fair comment, the poorest paid could always live in abject unrelieved poverty.
I suspect that this is done so as to allow businesses to recover tax which would probaly be harder to achieve with an increase in duty
I certainly wouldn't argue with that.
A VAT rise potentially rewards the poor. As the price of things go up and perhaps beyond the point of affordability for a poor family they then can save the money they have, therefore giving them more disposable income for essentials. 
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150 billion of savings annually cannot be done surely ?
Soldato
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Well it has to be - our structural deficit is > £160bn. This won't correct itself as GDP goes up.
It's not going to be, there are other tax rises contained in the coalition proposals, again mostly on non-essential items...
There is also the hope that growth will mean we don't need to save all that...
Well...
I wouldn't mind paying more tax if the country was going to use it and we aren't going to be bailing out other countries or the EU.
I read, not long ago, that we sent several hundred million to another country in aid (i.e. from the governments coffers not from a charity) so how can we afford to do this? Surely if we didn't send this aid money all over the place then we could afford to keep taxes down?
M.
I wouldn't mind paying more tax if the country was going to use it and we aren't going to be bailing out other countries or the EU.
I read, not long ago, that we sent several hundred million to another country in aid (i.e. from the governments coffers not from a charity) so how can we afford to do this? Surely if we didn't send this aid money all over the place then we could afford to keep taxes down?
M.
This country really needs to strike a huge oil reserve somewhere, like the Falklands say.
Then at least we can "drill" our ways out of this debt. Might not be terribly ethical but, seriously, **** ethics and morals. When you owe this much money it is pretty much every country for themselves.
As said, fixing the budget deficit is one thing. All that does is balance the books for going forward.
But we still have ~£900 billion to pay back in debt. Now either the government sorts out the budget deficit to such an extent that they're pulling in extra £80 billion a year in "profit" or something. Which would mean us being able to gradually pay off the £900 billion in about 12 years. Or, they aren't able to fix the budget deficit to that extent so we're stuck with that huge debt on us for generations to come.
Really it comes down to how quickly the government wants to pay off this debt.
But I am certain that the Tories will be wanting to pay as much of it off as possible during their 5 year term. And they'll want to, preferably, have another 5 year term after that to ensure they can complete their work of fixing the country.
Of course by then Labour will snapping at the heels so they can start spending again. And the vicious boom and bust cycle starts again.
Then at least we can "drill" our ways out of this debt. Might not be terribly ethical but, seriously, **** ethics and morals. When you owe this much money it is pretty much every country for themselves.
As said, fixing the budget deficit is one thing. All that does is balance the books for going forward.
But we still have ~£900 billion to pay back in debt. Now either the government sorts out the budget deficit to such an extent that they're pulling in extra £80 billion a year in "profit" or something. Which would mean us being able to gradually pay off the £900 billion in about 12 years. Or, they aren't able to fix the budget deficit to that extent so we're stuck with that huge debt on us for generations to come.
Really it comes down to how quickly the government wants to pay off this debt.
But I am certain that the Tories will be wanting to pay as much of it off as possible during their 5 year term. And they'll want to, preferably, have another 5 year term after that to ensure they can complete their work of fixing the country.
Of course by then Labour will snapping at the heels so they can start spending again. And the vicious boom and bust cycle starts again.
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As that great 20th century observer Ian Dury so eloquently expressed it "Hope springs eternal . . ."
Fingers crossed then that our government somehow wins the lottery, because it'll be 2030 by the time this gets paid off imo.
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Once the deficit has been paid down, are they going to return the additional taxes to their previous rates, or do we get the shaft constantly?
The deficit isn't 'paid down', it's the difference between income and outgoing spending.
With the deficit at zero, all the tax rises would have to remain to keep it that way, as would all the spending cuts.
Cutting the national debt (currently nearing a Trillion if you allow the government to continue abusing the international accounting rules) is a different issue entirely.
Deleted member 66701
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God dammit!
If this happens it's another policy I'll find myself agreeing with, even though I'm an ardent Labour supporter.
VAT is inhertently a fair tax. Under Value Added Taxation, the well off and rich typically pay more (ignoring any loopholes) - vat on a 52" tv generates more tax than vat on a 20" crt, vat on a Ferrari is more than the vat on a Fiat Panda (or zero if buying 2nd hand, which the less well off generally do) and so on ans so forth.
Want to pay less tax? Buy less stuff.
I think Camerons description of "Liberal Conservative" is becoming more apt by the minute.
If this happens it's another policy I'll find myself agreeing with, even though I'm an ardent Labour supporter.
VAT is inhertently a fair tax. Under Value Added Taxation, the well off and rich typically pay more (ignoring any loopholes) - vat on a 52" tv generates more tax than vat on a 20" crt, vat on a Ferrari is more than the vat on a Fiat Panda (or zero if buying 2nd hand, which the less well off generally do) and so on ans so forth.
Want to pay less tax? Buy less stuff.
I think Camerons description of "Liberal Conservative" is becoming more apt by the minute.
Where are you getting that figure from? It's generally agreed that the structural component of the total deficit (which is £163bn according to the latest figures) is around half that, probably a bit less ~£70bn.
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It can't be.
That is equivalent to cutting the NHS and defence budgets completely