Starmer's vision quest

[Stevo 666]

The problem that most people have with the existing tax system is that once you get to a certain level of wealth it seems to be incredibly easy to dodge taxes by moving your wealth off shore, into Trusts, shell companies etc. Once you get into superwealth, taxes aren't being paid fairly.

For example between 2000 and 2010 Lord Ashcroft received payments of £150m from his offshore trust in Bermuda and paid absolutely no tax. He repeatedly states that he is going to give up his non-dom status but remains a resident of Belize. He was required to pay full tax between 2010 and 2015 whilst he sat in the House of Lords. He did however but £33m of shares the day before the new law requiring him to pay tax came into effect, took no income for 5 years and then immediately sold shares worth £11m - again paying no tax.

There is nothing illegal about what he is doing / what he did but it does boil the piss of quite a few people.

Seriously, if you think that sort of stuff is easy these days then you are mistaken - a lot has changed since the days when simply sticking profits in sunny tax havens was a sport. High profile individual cases where someone is within the law but you don't like the outcome as you mention above will always be easy to find but are not representative of the international tax system - I can give some examples if you want.

 

[Stevo 666]

There is no point posting links that people can't read. If you want to pay to subscribe to a discredited comic, that's your call. But posting the links here is pointless.

OK, here's a quote. I thought everyone knew how to get round the Torygraph firewall.
"Rachel Reeves has admitted that taxes are too high despite refusing to rule out further increases in future.

Speaking before the House of Lords, the Chancellor said that a combination of rising taxes and a ballooning debt bill is holding back the economy.

That is despite raising taxes by a record £40bn during her first Budget and repeatedly failing to say she will not raise levies further this year.

“We are living in an age of insecurity today, and economic policy has to respond to the moment which we live in,” she said.

“At the same time, we also have a challenging economic inheritance, with high levels of tax as a share of GDP, historic high levels of government debt, and also economic growth that really for the last 15 years has been very poor by historical standards, because of weak productivity growth.”

Ms Reeves’s appearance before the Lords came just hours after new figures revealed the Government borrowed more than £20bn in June alone, piling further pressure on Britain’s debt interest bill.

The Chancellor acknowledged this is a problem but said she is trying to reduce borrowing costs.

“£1 in £10 the Government is spending is spent servicing Government debt,” she said. “I am a Labour politician, I don’t think there is anything progressive about spending £100bn per year - often to US hedge funds - when I would rather spend that money on the health service or defence or on better schools for our children.

“That is why I am going to stick to the fiscal rules, so that we can start to bring down the cost of servicing that debt.”

However, the Office for Budget Responsibility has already warned the cost of servicing the UK’s debt pile is unlikely to fall any time soon.

The fiscal watchdog expects the Government to borrow tens of billions of pounds more each year than it previously forecast before Labour came to power.

Current estimates show that national debt will rise to £3.3 trillion by 2029, up from £3.1 trillion under the Conservatives.

The OBR predicts this will result in an annual debt interest bill of more than £130bn by the end of the decade, far higher than £111.1bn recorded this year.

Despite her move to increase taxes and borrowing, the Chancellor warned that the Government cannot bow to backbenchers’ requests to ramp up spending.

“You cannot do everything that everybody would like to do,” Ms Reeves told the Economic Affairs Committee.

“There are always going to be more demands on public resources than we have money available, and we have to prioritise.

“There is not a limitless pot of money, as much as people might like there to be, or sometimes think there is. Even with the additional money available, we still have to make priorities.”

Ms Reeves declined to comment on what might constitute a sustainable level for the tax burden, instead arguing that it is critical to find other ways to boost economic growth."

 

[icowden]

OK, here's a quote. I thought everyone knew how to get round the Torygraph firewall.
"Rachel Reeves has admitted that taxes are too high despite refusing to rule out further increases in future.

Speaking before the House of Lords, the Chancellor said that a combination of rising taxes and a ballooning debt bill is holding back the economy.
That is despite raising taxes by a record £40bn during her first Budget and repeatedly failing to say she will not raise levies further this year.
“We are living in an age of insecurity today, and economic policy has to respond to the moment which we live in,” she said.

Ah, it's clickbait. At no point did Reeves admit that taxes are too high or refuse to rule out further increases. Got it.

 

[Stevo 666]

Ah, it's clickbait. At no point did Reeves admit that taxes are too high or refuse to rule out further increases. Got it.

She's never going to say explicitly but if you read what she said and apply a bit of thought and interpretation you will see it. Unless of course you don't want to.

 

[icowden]

She's never going to say explicitly but if you read what she said and apply a bit of thought and interpretation you will see it. Unless of course you don't want to.

Ah yes. I see now that when she said

The easy thing to do as a chancellor is to cut capital spending because, you know, frankly, you're not likely to be the government that sees the full benefit of that capital spending. But we're not going to keep making those shortsighted wrong decisions

What she actually meant is that she is going to cut capital spending and give everyone a free balloon.

 

[Psamathe]

Can you explain why you think a wealth tax is a good idea and an effective revenue raiser?

For me it's not about a "Wealth Tax", more that the wealthy (those with the broadest shoulders" need to be taxed more in relation to their disposable income. Recent years we've seen the rich get richer and the poor get poorer (relative to each other).

Those on ludicrosus salaries have massive disposable incomes. Does anybody thing that the CEO of Southern Water needs an anula income of £1.4m to cover his mortgage, holiday, food, heating, Council Tax, etc. And extra will be "invested" wherever the sought returns are and that is as easily overseas as in the UK - makes no difference where you live eg unfortunately a significant portion of my own savings are invested overseas).

So present system is some struggling using food banks to survive whilst others getting paid more than they (and their next generation and the next generation's next generation) could ever spend on any sensible lifestyle.

Not suggesting take all their extra cash,just they can be taxed higher and still enjoy fabulous lifestyles beyond the wildest dreams of 99% of the population.

Whether that is best achieved through wealth tax, income tax, capital gains tax or whatever is more a consideration of tax experts not the likes of me.

Also whilst it's sensible for politicians to establish broad policy eg those with broadest shoulders should pay more tax, best if tax experts come-up with best way to achieve than.

Ian

 

[First Aspect]

The issue isn't how progressive the tax system is, as much as how porous it is. Too complex and too many legal loopholes.

 

[CXRAndy]

The tax institutes tax reference books were only several books in the early 90s. By 2010 the books stacked, stood over 3ft tall as each parliament added more and more legislation to tax. It became a total nightmare of the government's own doing. They created gaps by complicating the tax laws.

Only when general avoidance rules came in to effect mid teens did avoidance begin to wither for medium sized businesses and individuals.

The uber rich and multinational companies still have avenues of arranging their financial affairs

 

[Psamathe]

The issue isn't how progressive the tax system is, as much as how porous it is. Too complex and too many legal loopholes.

To the point where I suspect those loopholes are included deliberately so politicians can stand up and say "we've ..." yet those supposedly affected just switch x to y and they are not affected (as intended by their mates in Parliament). But maybe that's being to conspiratorial and it's just politicians being incompetent doing what they are being paid to be competent at.

 

[First Aspect]

There's probably a good reason for many of them, but income should be income, however it is derived. I wouldn't be the first to query why cgt and dividends are treated any differently to a salary.

 

[C R]

There's probably a good reason for many of them, but income should be income, however it is derived. I wouldn't be the first to query why cgt and dividends are treated any differently to a salary.

Because only the little people get salaries.

 

[First Aspect]

Because only the little people get salaries.

I get the idea that governments like to boost investments and encourage businesses, but I've never been convinced that anything other than a decent tax free allowance is necessary.

 

[Pblakeney]

Because only the little people get salaries.

More to the point, the little people don't get cgt or dividends.

 

[Psamathe]

There's probably a good reason for many of them, but income should be income, however it is derived. I wouldn't be the first to query why cgt and dividends are treated any differently to a salary.

Loopholes created by wealthy politicians to allow their mates to avoid paying tax? (or maybe over the years I've just become far too cynical)

More to the point, the little people don't get cgt or dividends.

Which means they don't benefit from the low taxation on such income.

 

[BoldonLad]

To the point where I suspect those loopholes are included deliberately so politicians can stand up and say "we've ..." yet those supposedly affected just switch x to y and they are not affected (as intended by their mates in Parliament). But maybe that's being to conspiratorial and it's just politicians being incompetent doing what they are being paid to be competent at.

Defending polictians is not my natural habitat, but, do Politicians actually draft these rules and laws, I would have guessed it was Civil Servants and/or Consultants who did this. Which, incidentally means the level of competence of drawing up these things has little to do with which party is in power. Admittedly, the level of scrutiny in the HoC may vary by party in power, but, not the HoL.