Mitchy260

Cant believe this.....

BBC NEWS | Politics | Basic rate taxpayers to get £120

Personal allowance that has just recently moved up from 5225 upto 5435 is now being moved upto 6035

A good move in my books

(Will still be voting tories though )

GC8

Theyre desperate to hold on: arent they?

Mitchy260

Should have read the article in full, they're also reducing the 40% threshold to compensate so higher rate tax payers dont see the gain.

Still the 543L that has just recently appeared on our pay statements will be changed with 603L regardless of how much you earn.

Desperate move...Yes.

600 x 0.20 = £120pa or an extra £10pm for those that are in the 20% band.

Is £10pm going to swing the vote back in their favour....

Ringpeas

They will claw it back in tax rises somewhere else

PeteBrant

I don't think this is aimed at the voter - It's aimed at Frank Field and friends to stop a rebellion.

warrenm2

dead fish thrashing

AndyC_772

iTrader: (2)

This is exactly why they're so fond of stealth taxes.

Put up income tax - the one tax we have which is actually linked in some way to ability to pay - and people whinge and moan about it. So instead they use other taxes, which aren't linked to ability to pay and are, therefore, intrinsically less fair, and yet people don't complain nearly as much.

Of course, they can't allow the "rich" higher rate taxpayers to benefit - at all - from this U-turn, because the jealous and stupid would whinge about that too.

I wonder how many motorists there are in the country compared to the number who lost out by the abolition of the 10p rate - and whether a single step increase in fuel duty (as opposed to the continual upward creep we're used to) would provoke a similar reaction?

CharlesW

It's only for the current tax year. Best to wait and read the small print before we cheer. They usually hide the bad news in the detail.

Sheepsplitter

A perfect example of bad planning.
Gordon Brown brought this tax in, then he changed his mind and had Darling cancel it, then he's changed his mind again and patched up the mess he got himself into.
The bloke is simply incapable of putting together a long term tax strategy, and can't resist tinkering.
This time I think even his Labour voters will see through him.

RJMS

iTrader: (2)

The really stupid thing about it is that (according to a quick google) the 10p tax band applied to £2230 of income therefore removing it meant an extra £223 tax per annum (I know it's not quite that simple as the basic rate was reduced at the same time but close enough I think). They have now given everyone who is not a higher rate tax payer £120 back.

So basically the lower paid who were originally hit by the removal of the 10p band are still out of pocket (although not by as much) but there are an additional 15 million odd tax payers who are going to be better off.

If you were cynical you might think that they are trying to buy votes but surely that can't be the case can it?

kingofturds

iTrader: (1)

I'm starting to think Gordon Brown is an utter retard spazo inept as chancellor, inept as PM

Ringpeas

Starting to think?

c_maguire

What a surprise, nothing for me as usual. I, along with countless others, pay tax at the higher rate not because I am a mega-earner but because the threshold for the higher rate has failed to rise at anything resembling a realistic reflection of the cost of living and salary increases.
The reality for me is that there is just no incentive whatsoever to do the extra hours that then take me into the higher tax rate, as the extra hours and the stress that goes with them impact on my quality of life far more than the money they generate for me. My customers may well suffer as it is often these extra hours that get their problems solved and them back into production. Frustrating for me and them.
I feel sympathy for low earners and there is no doubt they should be reimbursed but I am also sick to death of these arseholes squeezing me year on year. They just sap my desire to work and better myself as the rewards are so small.
Give it 2 years and our unelected PM will likely be kicked out and then find himself in receipt of a very nice pension courtesy of you and me , Taxpayers 'R' Us. Where's the fairness in that?
Makes me so angry I'd probably lamp the ******* if I saw him in the street, and damn the consequences.
Kevin

lordretsudo

According to today's paper, he will be borrowing an extra £2.7 billion to fund this, as if he isn't in enough debt as it is...

r32

Its only for one year though, are people really that easily taken in?
He'll get it back some other way.

Paul3446

I don't get the one year bit, are threshholds being changed again next year then?

Butty

iTrader: (2)

But look at how much extra unexpected money he has from fuel duty in the last 6 months.

It about time that Gordo took the hint he isn't welcome - I've never known a PM get into so much grief in so short a time in office.

nick

PeteBrant

Either the rates or the thresholds are. But then the thresholds change most years.

We will know more in the pre budget report in the Autumn.

PeteBrant

I think he had to do something. For whatever reason, they are obviously dead set against reinstating the 10p rate. So they have patche dover the hole the dug themselves wit the measure.

At the end of the day it does the job - It solves the problem of lost momey, to a certain extent for those worst off.


However. One thing that does grate is this. This morning on Radio 4, the Chancellor was asked what effect pumping £2.7Billion into the economy will have on inflation. He sreposnse was "it won't affect it because that extra money covers the extra cost of food/petrol etc".

Fine. Execpt that the governemnt refused to give police offcers thier promise dpay rise in one hit (which would have cost £40 million) because they didnt want to threaten the inflation rate.

So, under the governments logic. £40 million can an adverse effect on inflation, but £2.7billion can't.

jasey

The Government (or the Bank of England) Seem to think inflation is running at 3%.

Anyone here think that prices are only 3% more than this time last year and that they will only be 3% more this time next year.

There seems to be a big black hole somewhere

PeteBrant

Depends what you ar emeasuring the prices of.

the CPI measurement is a genuine measure. It's not made up. What is contentious is whatit measures. It measures the actual price paid for an "average" basket of shopping, as opposed to the retail price (RPI). THe average basked contains a pretty exahustive list of items you pay for. And the basket for RPI and CPI is pretty similar (you can find that actual baskets here: http://www.statistics.gov.uk/elmr/04..._Wingfield.pdf)

Altough people say that "no way is inflation that rate" It is diffcult to find something missing from the basket. Remember Inflation is not just based on the price of Petrol and Gas. It gets dragged down by consumables that are reducing in price (clothing for example)

There is possibly an argument for an additional inflation rate for essentials. I.e. What we have to pay to live.

PeteBrant

Not quite - It usually rises in line with inflation. In 1998/99 the personal tax allowance was £4,300. It was set as £5,435 for 2008/9, giving an average rise of £113.5 per year.

lordretsudo

I think that's a good point - there was a very sensible economist type on the news yesterday who was saying more or less that: the things that are seeing the big increases are the things we can't really manage without, i.e. staple foods, heating/electricity, petrol. Inevitably, this means people feel that inflation is way higher than it probably is, taken as an average measure of everything out there in the economy.

I wouldn't like to be in the position of trying to sort this mess out. The poor BoE are completely stuck - lower interest rates = higher inflation, so they're between a rock and a hard place.

Dream Weaver

It gets them nearly 2 packets of Lambert & Butler

alcazar

iTrader: (2)

Yep, £120 million a WEEK, for 26 weeks AT LEAST, comes to, wait for it:

£3.12 BILLION!

So......he needs to borrow because.................?
Answers on a postcard.

Alcazar

Mitchy260

Last couple of years have went from 502L to 522L to 543L and now to 603L, but yes granted it wont be the £200 every year.

PeteBrant

It's VAT rather than Fuel Duty that has been given an unexpected boost (Fuel Duty is a fixed sum) - And reports are that that figure is around £2.5Billion.

However, what you have to remember is that its a bit of a dodgy thing to spend VAT revenue as if it were a permenant fixture. What you gain in one area, you may lose in another (How much revenue has been lost through lots of peopel giving up smoking? What happens when the VAT raised on Fuel drops?).

Hence, I beleive, the reason for Borrowing the money - It is a known figure. I am pretty certain the government would not have increased borrowing and put themselves in the firing line for doing so unless they absolutely had to.

r32

The CPI is massaged by HMG to try and screw the numbers and make them look good. Its come under fire from lots of areas. The weightings and the list of goods do seem odd if you look closely. We dont all continue to buy flat screen TVs and DVD's.
Like criminal damage is now no longer included in the crime figures.

PeteBrant

DVD players and TV's represent two items in the basket out of literally hundreds. Do you really think that these two items would have such a big influence as to skew the figures?

They ar enot "massaged" at all. Take a look at the basked link I gave and you will see that "Massaging" the figures is almost impossible.

BargainGirl

The government listening to the community and responding seems fair enough