Taxing matters

If you can accept that Nick Clegg's so called 'wealth tax' is a contribution to the debate, then you will note that tax is starting to feature more and more in the current political and media discussions.

Clegg and, earlier Cable, have prattled on about a 'mansion tax' or a 'wealth tax'  If I understand the latter this will be some kind of tax on assets.  If it is, then as Anthony Hinton pointed out, in the London Evening Standard, this then acts as a bringing forward of Inheritance Tax and, for those elderly people, who are asset rich but cash poor, would present a very difficult situation.  The 'mansion tax' would seem to present the same issues.  So trying to spend tomorrow's money, today.  You might even call it, borrowing from the future!

I have tried to find out 'who pays, what' as regards Income Tax.  That is, what percentage of the working population pay what percentage of the total taxes?  We hear that something like the top 10% of earners currently contribute more than 50% of the total tax take.  Is contribute the right word when it is compulsory?
I digress.

Do these Lib Dem 'rocket scientists' and their socialist colleagues in the Labour Party, have an absolute number in mind for the top tax rate - for their so called 'fair tax'?  That is, have they modeled their tax and tax 'plans', to see just how much revenue would actually be raised?

I sense (and stand ready to be proved wrong) that the only way that further tax will be effective, is if the higher rate is spread wider - so more and more of the masses in the 'middle classes' are brought deeper into the fold - I just don't think that the 'rich' can be  taxed sufficient to feed the beast that is government spending.

 I come at the tax question from a different angle.  I believe that the most effective way to stimulate the economy would be to cut taxes.  If there are any ITEM members out there, maybe they could model this?

Raise the tax threshold to £15,000, abolish the 45% rate, reduce the 20% rate to 15% and the 40% rate to 35% and reduce fuel tax by 5% and eliminate the green levies being applied on fuel provision.  Give an NI holiday to employers who take on new employees and hold it for three years.

Of course this will cost money - that is the great maw that is government will initially  receive lower direct income - and so to overcome the gap, the choice is either real cuts in government expenditure or more QE.  The proper and courageous solution is for cuts to be made but given the Lib Dems baleful influence on government policy we can expect 'bleeding hearts and stumps' to be used to persuade politicians to avoid the work for which we employ them and the decisions that we expect them to make.

If there are leftists out there who can prove that tax cuts will not stimulate the economy and/or that further government spending will, then do so, otherwise, join the campaign to get tax cuts implemented as a priority.

If there are any Conservative MPs that understand the founding principles of their party, then perhaps they can push their party to act like Conservatives!



 

  

50% Tax, Mansion Tax - No to both!

As we run up to the UK Budget, we are hearing some of the horse trading that the Lib-Dem part of the Coalition are trying to push.

The Lib-Dems are suggesting that the 'price' for their support in removing the 50% tax rate, on salaries over £150K, would be the introduction of a so-called Mansion Tax of 1% on houses valued at more than £2 million.

So, they want to replace a tax that raises far less than was projected, with another tax that, while playing to the current public clamour for higher taxes for the rich, will also not likely raise any meaningful levels of income and will impoverish those people, mainly in the South East, who are asset rich but income poor - those that, because of property price inflation have seen the value of their houses increase but who do not necessarily have an income which would support such a house price nor would allow them to pay the tax!

Think about this a little further.  These houses have largely been purchased out of taxed income - yes some will have been inherited, but the majority will be the fruits of the labour of their owners.

With their push for this Mansion Tax, the Lib Dems clearly show their Socialist colours. 

• Tax people highly, when they are earning.
• Tax people on what they spend their after tax money on
• Tax people on what those possessions that they purchased, with after tax money, when they die.

In short, Tax, Tax, Tax 

I may have missed a step in this process, if I did, you can be sure that the Lib Dems and their Socialist fellow-travelers in the Labour Party, will want it taxed.  As you would expect, Labour backs the Mansion Tax, so long as the money raised is spent on their pet projects, which are otherwise unaffordable.

I call on true Conservatives to do three things.

• Recognize that the Conservatives are the majority party in the Coalition and act accordingly - don't let the tail, wag the dog!
• Have the courage to remove the 50% rate and live with the political fall-out - tell the truth about how it is simply a fig-leaf to make politicians feel good and really is counter-productive as a revenue raising tool.
• Consider what being a Conservative means and understand that it isn't just about being in power at all costs, it is about implementing Conservative policies while in power!

Please pass this on to others.  Pandering isn't an attractive trait.