Re: Bob
Posted: Wed Apr 14, 2010 10:05 pm
David Johnson wrote:
> Hi Bob,
>
> "Labour's increase in National Insurance is indeed a tax on
> jobs. ...Surely it would be better to tax income generated by
> way of an increase in the higher levels of income and
> corporation tax? "
>
> I suppose the vast majority of taxes are directly or indirectly
> a "tax on Jobs" whatever that means. You could argue that
> higher levels of income tax or corporation tax might result in
> businesses relocating abroad or holding back on investment in
> new jobs/equipment etc.
>
> The term "tax on jobs" was brought out by Cameron and he has
> been hammering it for quite a few days now as he trumpets about
> all the business leaders that support his view. Cameron's view
> strikes me as nonsensical. He implies that it will result in
> loss of jobs. How much will a 1p rise in National Insurance
> cost?. My guess is that it is unlikely to be much more than
> ?15 a month. And I can't believe that this is a key
> decision-making factor in whether you hire or fire people. As
> for the business leaders who support him, these are the same
> tossers who along with Cameron, spoke against the Labour
> introduction of the minimum wage, pay themselves hugely
> compared to their workforce and relocate to Eastern Europe or
> elsewhere on a regular basis. As if they give a toss about
> their workforce and job security.
If you are a company like Tescos for example, that ?15 per month per employee works out at several tens of millions in a year. I'm not defending Tesco and their greed for ever larger profits, but I don't personally think an increase in National Insurance was the best way of going about things.
For the Tories amongst you, by the way, you may be interested to know that one of Cameron's leading advisers on industry (specifically on how to create more jobs in Britain) is James Dyson, the man who invented the dual cyclone bagless vacuum cleaner and who recently closed his factory in the UK and relocated to Malaysia to cut costs. What a great example he's setting, putting his personal greed ahead of the good of the country!
> "And what about the ?40bn or so HMR&C recon is being lost each
> year through tax avoidance schemes? At least the Lib Dems look
> as if they want to do something about it! Getting some of that
> money back would go a long way to plugging the whole in the
> economy."
>
> The Customs and Revenue have been hammering this in the press
> over the past few months, stating that this is the last few
> weeks of the opportunity to come clean about payments going
> offshore. Tax avoidance is just fiddling the tax via a
> loophole before that loophole is closed aind it becomes tax
> evasion i.e. illegal. The large multinationals employ the
> likes of Barclays to have a range of tax avoidance measures up
> their sleeves so that however quickly the government closes
> down one loophole there is always a Plan B lined up.
>
> In short, going after tax avoiders always results in
> substantially less tax collection than is expected.
As I understand it (and I may be wrong, so feel free to correct me), but the Lib Dems, amongst other things, will change the status of non-doms, so that after 7 years they will pay tax on offshore income, they will stop the use of offshore companies to avoid stamp duty on properties, and HMR&C will be given new powers that effectively "tax" companies (ie accountancy firms) who offer help to others in tax avoidance (I'm not sure on the minutiae but I understand that if XYZ Accountants save ABC plc ?500m by avoiding paying tax then XYZ Accountants get "taxed" on the savings they make their client, thus removing some of the incentive to come up with tax avoidance schemes)
>
> "They are quite right in wanting to break banks up, so that
> they are either high street institutions catering for
> individuals and businesses on a day-to-day basis OR they can be
> giant gambling houses but not both!"
>
> I agree with this. However, it is difficult to see how this
> would work in a global environment if other major countries do
> not buy into it. Labour have given their support to a global
> bank levy. Again how this would work without support from the
> key players is difficult to see given the interconnected nature
> of the business.
One of the reasons many British high street banks are owned by Santander is because in Spain banks may either be retail or investment institutions, not both. As a consequence, Spain was not hit as hard by the collapse caused by the sub-prime market in the US, and one of its amjor retail banks was able to pick up a few British high street banks and building societies fr a song. There is no reason why Barclays, for example, cannot be split into two separate entities; one being a traditional high street bank and the other an investment bank. If the investment bank fails, at least it won't affect the high street bank as the two are separate companies.
Regarding the bank levy, this is where for once Gordon Brown is streets ahead of the Tories. The Tories have talked about a unilateral bank levy in a pathetic attempt to curry favour with the voters. However they know that this is totally unworkable (if no other country enforces a levy, the banks will just move abroad). That's why both Brown and President Obama have both insisted the levy be global.
>
> "If only Labour were so radical, but under Blair and Brown
> they've become Tory Lite"
>
> I guess it is relatively easy to be a radical if you have 0%
> chance of being the first or second in the poll. THe best the
> Liberals can hope for is that in the scenario of a hung
> parliament they have some members of the Cabinet and/or some
> policies taken up in return for their support.
>
> The Labour party realised rightly in 1997 that pursuing a
> radical policy would not get them elected. The reason for this
> is quite simple. It is commonly thought that the government of
> the day runs the country. Personally, I don't think that is
> the case. Basically they have limited room for manouevre in a
> world of global multinationals and a global economy that can
> shift its assets, headquarters etc. with relative impunity. In
> addition, as we know, about 90% of the media in this country is
> ferociously Conservative.
>
It's absolutely true that whoever is in power will have at least one hand tied behind their backs due to the global nature of business and money. However, there are still things Governments can do within their boundaries that affect the welfare and happiness of the population, irrespective of whatever is going on beyond our shores. The Labour Government of 1964-66-70 saw one of the most liberal Home Secretaries in Roy Jenkins... a man who, among other things, steered through Parliament legislation that saw an end to capital punishment and the legalisation of homosexuality. The last 13 years has seen increasing repression by way of ever more CCTV cameras in our streets (without any resultant decrease in crime, I might add!), the possibility of identity cards, etc., etc. The fact that Murdoch was so chummy with Blair for so long is probably the biggest indictment of all. As I said Tory Lite
There's an air of honesty about the Lib Dems that is refreshing. They're the only party that haven't ruled out tax increases whilst also cutting spending. Both the Tories and New Labour are glossing over the fact that either VAT or Income Tax will have to increase at some point. Why did Labour only partially reform the House of Lords? It really is time we had an elected second chamber. I also agree with them regarding electoral reform, many of their environmental policies and in getting rid of this stupid notion that 50% of children should be able to go to university.
> Hi Bob,
>
> "Labour's increase in National Insurance is indeed a tax on
> jobs. ...Surely it would be better to tax income generated by
> way of an increase in the higher levels of income and
> corporation tax? "
>
> I suppose the vast majority of taxes are directly or indirectly
> a "tax on Jobs" whatever that means. You could argue that
> higher levels of income tax or corporation tax might result in
> businesses relocating abroad or holding back on investment in
> new jobs/equipment etc.
>
> The term "tax on jobs" was brought out by Cameron and he has
> been hammering it for quite a few days now as he trumpets about
> all the business leaders that support his view. Cameron's view
> strikes me as nonsensical. He implies that it will result in
> loss of jobs. How much will a 1p rise in National Insurance
> cost?. My guess is that it is unlikely to be much more than
> ?15 a month. And I can't believe that this is a key
> decision-making factor in whether you hire or fire people. As
> for the business leaders who support him, these are the same
> tossers who along with Cameron, spoke against the Labour
> introduction of the minimum wage, pay themselves hugely
> compared to their workforce and relocate to Eastern Europe or
> elsewhere on a regular basis. As if they give a toss about
> their workforce and job security.
If you are a company like Tescos for example, that ?15 per month per employee works out at several tens of millions in a year. I'm not defending Tesco and their greed for ever larger profits, but I don't personally think an increase in National Insurance was the best way of going about things.
For the Tories amongst you, by the way, you may be interested to know that one of Cameron's leading advisers on industry (specifically on how to create more jobs in Britain) is James Dyson, the man who invented the dual cyclone bagless vacuum cleaner and who recently closed his factory in the UK and relocated to Malaysia to cut costs. What a great example he's setting, putting his personal greed ahead of the good of the country!
> "And what about the ?40bn or so HMR&C recon is being lost each
> year through tax avoidance schemes? At least the Lib Dems look
> as if they want to do something about it! Getting some of that
> money back would go a long way to plugging the whole in the
> economy."
>
> The Customs and Revenue have been hammering this in the press
> over the past few months, stating that this is the last few
> weeks of the opportunity to come clean about payments going
> offshore. Tax avoidance is just fiddling the tax via a
> loophole before that loophole is closed aind it becomes tax
> evasion i.e. illegal. The large multinationals employ the
> likes of Barclays to have a range of tax avoidance measures up
> their sleeves so that however quickly the government closes
> down one loophole there is always a Plan B lined up.
>
> In short, going after tax avoiders always results in
> substantially less tax collection than is expected.
As I understand it (and I may be wrong, so feel free to correct me), but the Lib Dems, amongst other things, will change the status of non-doms, so that after 7 years they will pay tax on offshore income, they will stop the use of offshore companies to avoid stamp duty on properties, and HMR&C will be given new powers that effectively "tax" companies (ie accountancy firms) who offer help to others in tax avoidance (I'm not sure on the minutiae but I understand that if XYZ Accountants save ABC plc ?500m by avoiding paying tax then XYZ Accountants get "taxed" on the savings they make their client, thus removing some of the incentive to come up with tax avoidance schemes)
>
> "They are quite right in wanting to break banks up, so that
> they are either high street institutions catering for
> individuals and businesses on a day-to-day basis OR they can be
> giant gambling houses but not both!"
>
> I agree with this. However, it is difficult to see how this
> would work in a global environment if other major countries do
> not buy into it. Labour have given their support to a global
> bank levy. Again how this would work without support from the
> key players is difficult to see given the interconnected nature
> of the business.
One of the reasons many British high street banks are owned by Santander is because in Spain banks may either be retail or investment institutions, not both. As a consequence, Spain was not hit as hard by the collapse caused by the sub-prime market in the US, and one of its amjor retail banks was able to pick up a few British high street banks and building societies fr a song. There is no reason why Barclays, for example, cannot be split into two separate entities; one being a traditional high street bank and the other an investment bank. If the investment bank fails, at least it won't affect the high street bank as the two are separate companies.
Regarding the bank levy, this is where for once Gordon Brown is streets ahead of the Tories. The Tories have talked about a unilateral bank levy in a pathetic attempt to curry favour with the voters. However they know that this is totally unworkable (if no other country enforces a levy, the banks will just move abroad). That's why both Brown and President Obama have both insisted the levy be global.
>
> "If only Labour were so radical, but under Blair and Brown
> they've become Tory Lite"
>
> I guess it is relatively easy to be a radical if you have 0%
> chance of being the first or second in the poll. THe best the
> Liberals can hope for is that in the scenario of a hung
> parliament they have some members of the Cabinet and/or some
> policies taken up in return for their support.
>
> The Labour party realised rightly in 1997 that pursuing a
> radical policy would not get them elected. The reason for this
> is quite simple. It is commonly thought that the government of
> the day runs the country. Personally, I don't think that is
> the case. Basically they have limited room for manouevre in a
> world of global multinationals and a global economy that can
> shift its assets, headquarters etc. with relative impunity. In
> addition, as we know, about 90% of the media in this country is
> ferociously Conservative.
>
It's absolutely true that whoever is in power will have at least one hand tied behind their backs due to the global nature of business and money. However, there are still things Governments can do within their boundaries that affect the welfare and happiness of the population, irrespective of whatever is going on beyond our shores. The Labour Government of 1964-66-70 saw one of the most liberal Home Secretaries in Roy Jenkins... a man who, among other things, steered through Parliament legislation that saw an end to capital punishment and the legalisation of homosexuality. The last 13 years has seen increasing repression by way of ever more CCTV cameras in our streets (without any resultant decrease in crime, I might add!), the possibility of identity cards, etc., etc. The fact that Murdoch was so chummy with Blair for so long is probably the biggest indictment of all. As I said Tory Lite
There's an air of honesty about the Lib Dems that is refreshing. They're the only party that haven't ruled out tax increases whilst also cutting spending. Both the Tories and New Labour are glossing over the fact that either VAT or Income Tax will have to increase at some point. Why did Labour only partially reform the House of Lords? It really is time we had an elected second chamber. I also agree with them regarding electoral reform, many of their environmental policies and in getting rid of this stupid notion that 50% of children should be able to go to university.