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[travisbickle]

I still firmly believe that the interests of big business aren't the interests of the UK people. I've changed my tone a little over the last few months and I have a good deal of faith in our political system (thank God we're not in the US), and believe that higher taxation in return for higher public sector job numbers/output is the long term solution for the UK.

The long term solution to reduce deficit is higher taxes and higher public spending. Even Maggie Thatcher knew this, during her tenure the budget deficit had its greatest reductions when she increased public spending and increased taxes. Also the highest deficit reductions in recent memory are from 2009 a period when Labours increases in public spending were recognised as the main catalyst for the reduction.

However, in the short term I believe cutting expenditure and keeping tax rates the same is probably for the best. A lot of people need a good dose of reality, but don't need money taking out of their pockets to be spent on local businesses.

But good ol' George Osbourne has gone beyond that, he has increased VAT, a tax that impacts the poor the most, and at the same time decreased taxes that will only benefit the wealthy and big business, you know to balance things out because we're all in it together. Soon he'll drop the 50p tax rate because s Boris Johnson said London's rich can't afford their evenings on the town with such high taxes.

zomgwtfbbq is drinking from the champagne fountain with the rest of his banking buddies. History has shown increased taxes and public spending reduce defecits. All the Tories have done is shift the tax revenue from the rich to the poor (as I mentioned above) and proceeded to cut public spending a tactic we know will not help the deficit.
It's all ideological by the Tories, they are juggling around numbers in the background to benefit the rich whilst stating big numbers to the public to show that it is needed.

zomgwtfbbq, the point I was making is that a huge amount of the defecit was created by the failure of the banks and the government pumping lots and lots of money into them to bail them out.
They pumped more money into them then they did the car manufacturer industry, coal mining and failing retail outlets combined. And this was for an industry that employs the smallest amount of people relative to its revenue, those that it does employ are predominantly situated in the South East, and a high percentage of its employers are low skilled, low paid customer service or bank clerks who will soon be replaced by computers. The recession has affected the whole country. Why would you bail out an industry that doesn't help the whole country?

What I am saying is the government would have created more jobs for the country if they'd have spent a paltry amount bailing out Woolworths than they did bailing out the banks.

The big number you shout out doesn't mean anything when we all know banks dodge tax like its going out of fashion. What was the percentage paid by Barclays last year? 1% or something?

So most of that 50billion you mentioned goes on wages/bonuses, and as I mentioned the banking industry is the smallest employer relative to its revenue size ergo top bankers get huge bonuses.

 

[Rourkey]

The long term solution to reduce deficit is higher taxes and higher public spending.

Your kidding right? That's pretty much the silliest thing I've read on the Internet!

That policy is what got the UK into this mess, Gordon Brown increased spending and taxation by introducing a whole raft of stealth taxes on the basis boom and bust had ended so when the recession hit tax receipts fell through the floor but the country was left with the same amount if spending commitments hence the deficit ended up being the worst in the G20, if he had kept the surplus he inherited going could laughed our way through the last few years!

The best way to create jobs is to have a economy as free of regulation and union interference as possible as well as competitive tax rates, a small country with a an abundance of natural resources can get away with a policy you describe but certainly not the UK.

 

[Meadows]

Your kidding right? That's pretty much the silliest thing I've read on the Internet!

That policy is what got the UK into this mess, Gordon Brown increased spending and taxation by introducing a whole raft of stealth taxes on the basis boom and bust had ended so when the recession hit tax receipts fell through the floor but the country was left with the same amount if spending commitments hence the deficit ended up being the worst in the G20, if he had kept the surplus he inherited going could laughed our way through the last few years!

The best way to create jobs is to have a economy as free of regulation and union interference as possible as well as competitive tax rates, a small country with a an abundance of natural resources can get away with a policy you describe but certainly not the UK.

Regulate corporations more, regulate small businesses less.

Corporations don't pay enough tax. Fact. Can't shake anything at that, it's a fact. They don't pay enough. A lot of rich people do, sure, but the corporations don't. Close the loopholes and shame/boycott the corporations that are irresponsible.

 

[Rourkey]

Regulate corporations more, regulate small businesses less.

Corporations don't pay enough tax. Fact. Can't shake anything at that, it's a fact. They don't pay enough. A lot of rich people do, sure, but the corporations don't. Close the loopholes and shame/boycott the corporations that are irresponsible.

If a corporation is based in the UK and employs 10,000 people then that's a whole lot of payroll taxes and VAT the exchequer gets every month/quarter, if they buggered off that could be upto 10,000 people on benefits instead.

Not saying said Corporation is evil or not

 

[Meadows]

If a corporation is based in the UK and employees 10,000 people then that's a whole lot of payroll taxes and VAT the exchequer gets every month/quarter, if they buggered off that could be upto 10,000 people on benefits instead.

Not saying said Corporation is evil or not

If they buggered off someone would fill that market, hopefully (in my dream world), 100 small businesses that would instead of taking 5 people to a £2,000,000 a year salary, take 200 people to a £50,000 a year salary that could be taxed fairly.

 

[Rourkey]

If they buggered off someone would fill that market, hopefully (in my dream world), 100 small businesses that would instead of taking 5 people to a £2,000,000 a year salary, take 200 people to a £50,000 a year salary that could be taxed fairly.

That is a bit of a dream world mate, fact is we need every small business and corporation we can get, as long as they create jobs the country doesn't lose.

 

[Empty]

Your kidding right? That's pretty much the silliest thing I've read on the Internet!

That policy is what got the UK into this mess, Gordon Brown increased spending and taxation by introducing a whole raft of stealth taxes on the basis boom and bust had ended so when the recession hit tax receipts fell through the floor but the country was left with the same amount if spending commitments hence the deficit ended up being the worst in the G20, if he had kept the surplus he inherited going could laughed our way through the last few years!

The best way to create jobs is to have a economy as free of regulation and union interference as possible as well as competitive tax rates, a small country with a an abundance of natural resources can get away with a policy you describe but certainly not the UK.

do you really think we'd have laughed through the last few years with a surplus. i'd have like to have seen one because i'm a keynesian and would like to have seen it used to stimulate the economy and even if you're not it's of course beneficial as it stops us having to cut so much and increases investor confidence. but even with those advantages, the economy is built with far too much emphasis on a dominant banking sector and rising house prices and poor foundations, which made us far more susceptible to the crash than places like australia, canada and sweden that barely went into recession. just look at the poor growth compared to other big economies even before we started cutting and how much we lost compared to them.

 

[zomgbbqftw]

The long term solution to reduce deficit is higher taxes and higher public spending. Even Maggie Thatcher knew this, during her tenure the budget deficit had its greatest reductions when she increased public spending and increased taxes. Also the highest deficit reductions in recent memory are from 2009 a period when Labours increases in public spending were recognised as the main catalyst for the reduction.

The highest national debt reductions are from 1994-2000, a period when Conservative spending plans were in place (left absolutely untouched by Brown after Labour won in 1997). The highest deficit increases are from 2008-2010 when tax income crashed from the government, but spending commitments increased as social welfare spending went up because of increased unemployment. Please, get your facts straight. High taxes and high government spending are a toxic cocktail for low growth and poor job creation, look at any one of the EU economies for this phenomenon, then look at Germany since Merkel when she reduced government spending and taxes which lead to a massive boom in job creation.

But good ol' George Osbourne has gone beyond that, he has increased VAT, a tax that impacts the poor the most, and at the same time decreased taxes that will only benefit the wealthy and big business, you know to balance things out because we're all in it together. Soon he'll drop the 50p tax rate because s Boris Johnson said London's rich can't afford their evenings on the town with such high taxes.

VAT rises don't affect the poor more. Poor people spend a much higher proportion of their income on non-VAT items or low-VAT items. You need to look at the Lib Dems crazy plan to introduce regular VAT on energy sales for something that would hurt the poor. VAT is a tax on consumer products and luxury services, by definition poor families will be spending less of their income on these items. The 'studies' that claim poor people are affected most by these are usually not grounded in reality (the last one assumed people bought an average of 1.3 TVs a year).

zomgwtfbbq is drinking from the champagne fountain with the rest of his banking buddies. History has shown increased taxes and public spending reduce defecits. All the Tories have done is shift the tax revenue from the rich to the poor (as I mentioned above) and proceeded to cut public spending a tactic we know will not help the deficit.
It's all ideological by the Tories, they are juggling around numbers in the background to benefit the rich whilst stating big numbers to the public to show that it is needed.

So the increase of the tax allowance threshold helps absolutely no one right? Lifting millions of working poor people out of paying tax altogether helps no one?

The reason the 50% rate is bad is because it drives those rich folk away and replacing their income tax is difficult at a time when job creation is at a premium. The idea behind taxation is not to punish people, but to get as much revenue for government activity as possible. The 50% rate is as of now, a money loser. I am certain of it, the fudge used by Brown to say it raised £2.4bn has been shown up as a lie and it should be lowered in increments until it hits the 40% rate again. Politically difficult, but the government need to be looking at ways of increasing revenue, not for political expediency.

zomgwtfbbq, the point I was making is that a huge amount of the defecit was created by the failure of the banks and the government pumping lots and lots of money into them to bail them out.
They pumped more money into them then they did the car manufacturer industry, coal mining and failing retail outlets combined. And this was for an industry that employs the smallest amount of people relative to its revenue, those that it does employ are predominantly situated in the South East, and a high percentage of its employers are low skilled, low paid customer service or bank clerks who will soon be replaced by computers. The recession has affected the whole country. Why would you bail out an industry that doesn't help the whole country?

I was for letting the banks go bankrupt as long as people's savings were guaranteed. In any case, the banking industry gives over £50bn in taxes, believe me that would hard to replace. It's the equivalent of the education budget.

What I am saying is the government would have created more jobs for the country if they'd have spent a paltry amount bailing out Woolworths than they did bailing out the banks.

The big number you shout out doesn't mean anything when we all know banks dodge tax like its going out of fashion. What was the percentage paid by Barclays last year? 1% or something?

So most of that 50billion you mentioned goes on wages/bonuses, and as I mentioned the banking industry is the smallest employer relative to its revenue size ergo top bankers get huge bonuses.

Banks have legally avoided paying taxes by using DTAs where losses in previous years are written down against their future corporation tax payments. These are nearly all finished or about to expire. Once they do banks will pay a regular amount of tax, plus Osborne's bank balance sheet tax will raise around £2bn this year and £3-4bn next year. Labour's bonus tax raised around £1.5bn, but then the banks wised up and the second year would have raised less than a third of that amount.

Banking and finance is a huge industry in the UK, and replacing that income would prove to be very difficult for any government, let alone in a country so very dependent on the tax income of it. Chasing business away for idealogical reasons is poor governance.

 

[zomgbbqftw]

do you really think we'd have laughed through the last few years with a surplus. i'd have like to have seen one because i'm a keynesian and would like to have seen it used to stimulate the economy and even if you're not it's of course beneficial as it stops us having to cut so much and increases investor confidence. but even with those advantages, the economy is built with far too much emphasis on a dominant banking sector and rising house prices and poor foundations, which made us far more susceptible to the crash than places like australia, canada and sweden that barely went into recession. just look at the poor growth compared to other big economies even before we started cutting and how much we lost compared to them.

We would have. If the country went in with a balanced budget and a debt position of around 25-30% of GDP we would have laughed the recession off and government would have been able to run larger stimulus measures to get the jobs market moving again.

As it was, the VAT cut was complete bullshit, the UK produces few consumer goods, it was pissing money against a wall.

 

[Rourkey]

do you really think we'd have laughed through the last few years with a surplus. i'd have like to have seen one because i'm a keynesian and would like to have seen it used to stimulate the economy and even if you're not it's of course beneficial as it stops us having to cut so much and increases investor confidence. but even with those advantages, the economy is built with far too much emphasis on a dominant banking sector and rising house prices and poor foundations, which made us far more susceptible to the crash than places like australia, canada and sweden that barely went into recession. just look at the poor growth compared to other big economies even before we started cutting and how much we lost compared to them.

I'm a keynesian too as are most economists, if we had carried on with the surplus that Brown inherited we wuld have had ample amount of cash/ borrowing facility to see that the recession did not hit as bad as it did.

Keynes would be rolling in his grave if he heard some politicians saying his theories should be implemented retrospectively. Keynes theories state that in the good times the government runs at a surplus so that if there is a recession the government can step in to keep things on an even keel, of course western governments like the UK did no such thing and ran up significant deficits.

Check out this graph on it you can see that under the Tories in the 80's borrowing was quite small less than GDP growth so affordable, then a recession hit in the early 90's and government borrowing increased to compensate in line with Keynes theories.

http://www.guardian.co.uk/news/datablog/2010/oct/18/deficit-debt-government-borrowing-data#zoomed-picture

After the recession you can see that the government started heading to a surplus, again agreeing with Keynes and Gordon Brown carried on with his policy for his first 3 years calling it "prudence". However after 3 years Brown threw the Keynes rule book out the window and ran up large deficits despite seeing substantial world growth and despite increasing tax revenues by taxing everything under the sun (But yet people are willing to defend him)!

 

[Meadows]

Banking and finance is a huge industry in the UK, and replacing that income would prove to be very difficult for any government, let alone in a country so very dependent on the tax income of it. Chasing business away for idealogical reasons is poor governance.

The thing is that I think banking and finance is something that doesn't really help the working class or lower middle class. Sure taxes from employees in the sector help bank-role Government initiatives but what we need is an industrial sector, one that will give the working class/lower middle class some purpose and employment. Obviously we can't compete with Bangladesh and the like in terms of value, but in high-tech/high-end products we can lead the way.

 

[zomgbbqftw]

The thing is that I think banking and finance is something that doesn't really help the working class or lower middle class. Sure taxes from employees in the sector help bank-role Government initiatives but what we need is an industrial sector, one that will give the working class/lower middle class some purpose and employment. Obviously we can't compete with Bangladesh and the like in terms of value, but in high-tech/high-end products we can lead the way.

Why can't we have both, other countries do? Germany does, Frankfurt is pretty big for finance, not as big as London or NY, but still pretty big and Germany have a very decent high tech manufacturing sector.

It's up to the government to attract these people with tax incentives. Why, for example, does the UK have no major semi-conductor industry when one of the world's major architecture companies is British? Why haven't the government supported ARM with tax incentives and loan guarantees so they could compete with Intel on a global scale. In the US it is second nature for state and federal government to support risk with investment and loan guarantees, the UK government does no such thing and we are all poorer for it.

Psion is the classic example of how little support British companies get from government, read this article and you will see why high tech manufacturing and design is in such a poor state:

http://www.theregister.co.uk/2007/06/26/psion_special/

It's quite long, but honestly, the best piece of tech journalism I've ever come across.

 

[Meadows]

We should have both, you're right, but at the end of the day I believe that large corporations don't pay their fair share. They go through loopholes/offshores and get a million lawyers to make it all legit so that they don't have to pay any tax.

The amount of tax that Vodafone and Barclays paid was an absolute travesty and I would have urged people to boycott both companies if it weren't the case that such tax evasion is industry standard.

The reason why I think small businesses are good and corporations are bad?

Small businesses are run by people, corporations are run by bankers, shareholders and lawyers.

 

[zomgbbqftw]

The companies you mention have low corporation taxes because they have offset losses in previous years against current profits. All business does that, large and small. A friend of mine runs a recruitment company and his business made a £300k loss in 2009 and £25k loss last year, this year he will make £450k in profit but because of his historical losses he pays little to no corporation tax. Without that help many small business would go bankrupt, he definitely would have as he needs the profits from this year to cover the losses from the previous two years. Next year he will pay corporation tax like normal.

Same goes for Vodafone and Barclays. Their offset losses are running out and they will pay a normal amount of corporation tax from the start of this financial year.

Don't forget every business has an accountant, most are there to reduce tax liabilities as much as possible.

 

[kharma45]

If you're near a TV pretty dramatic scenes from Tottenham being shown on Sky News

 

[Chinner]

http://www.guardian.co.uk/world/2011/aug/06/police-cars-attacked-tottenham-mark-duggan

A bus, a shop and two patrol cars have been set on fire in Tottenham. An estimated crowd of around 300 have gathered after members of a community where a young man was shot dead by police took to the streets to demand "justice".

wtf

 

[zomgbbqftw]

Holy shit. I was watching 24 on DVD...

 

[zomgbbqftw]

http://www.guardian.co.uk/world/2011/aug/06/police-cars-attacked-tottenham-mark-duggan


wtf

So the police shoot some wanker with a gun and the rest of the wankers with guns want justice. Sounds like Tottenham to me. I live in a part of Enfield which isn't far from Tottenham...

 

[Keyser Soze]

I was just playing a game, switch back to Sky to see FIRE. Did not know what the fuck was happening.

I laughed when I saw there is a Low Emission Zone sign in the foreground, and in the background a bus on fire with smoke bellowing into the air.

 

[zomgbbqftw]

Watching a statement on the economy by George Osborne. He is such a shitface, but he has done a damn good job.

 

[SteveWD40]

Watching a statement on the economy by George Osborne. He is such a shitface, but he has done a damn good job.

Yep, we were getting shit 2 years ago from the US and EU for being the "sick man" of the G7, now it's them dragging us down (as much as our own growth is still sluggish as hell and we depend on them etc...)

But fundamentals are good now, it's just sovereign debt (theirs not ours) that's causing jitters, along with our banks exposure to it.

 

[zomgbbqftw]

Yeah, pretty much. We're basically in the clear.

Ed Balls is an absolute cunt. Needs to fuck off, his credibility is absolutely shot.

 

[War Peaceman]

Is that actually the case, though? I ask that genuinely, it is quite difficult to parse thereality amidst all the gloom and doom of the media.

 

[J Tourettes]

The respect I gained for Louise Mensch has been quickly pissed away by her lame tweets supporting Cameron's social network stance.

 

[Meadows]

Ed Balls is my least favourite mainstream politician.

 

[SmokyDave]

Ed Balls is my least favourite mainstream politician.

Does Diane Abbott count as a politician?

If so, I choose her with unbridled vehemence.

 

[radioheadrule83]

My favourite politicians currently in reasonably prominent positions:

- John Prescott. Breathing Northern fire and bluster all over parliament like a big pie-eating, protestor punching, phone-hack hating dragon.

- John Denham. Resigned over the iraq war and later came back. Always seemed like a nice bloke.

- Simon Hughes. Deputy leader of the Lib Dems, really intelligent and eloquent, he seems very good at talking sense.

- David Davis. He sounds like the narrator off Paddington Bear. A conservative with a lot of sense.

- Tom Watson. Bane of News International. Smart dude!

- Louise Mensch. Keeps putting her foot in it, for example - making inaccurate claims about Piers Morgan (a good and amusing thing) and calling for social media censorship in times of crisis (a very bad thing). Probably still would.

- Sally Bercow. Wanted Ed Balls as leader, so she's clearly got a screw loose, but that said, she was a good sport on HIGNFY, and well -- this: http://i.thisislondon.co.uk/i/pix/2011/02/sally-bercowv415.jpg

- Lembit Opik. Dated a cheeky girl, whats not to like?

and a controversial one to finish off:

- Nick Clegg. For some reason seen as a sad character and tainted by disgrace, seen as weak and two faced -- but his only crime was doing the right thing in the wake of the GE 2010 results and forging a credible government. Had the public voted more liberally, the Lib Dems would be getting more of their more progressive policies through, and they would have been able to keep to pledges on student fees etc. Out of the three leaders in the run up to the election, he was the only one who demonstrated any awareness of how tired people were of empty political PR rhetoric (although he did of course employ some of that himself). Again, he's another man who has a lot of sense. Its a shame that this term in government will probably be his last imo.


My least favourites / most hated:

Ed Balls - can't even pinpoint why. Smug, nasty and opportunistic.
Douglas Hogg (now retired) - duck moat guy
Simon Burns - just a horrible gobshite
Ed Vaizey - another gobshite, one who has a bit of a hate-on for the free internet
+ Anyone on the tory benches who talks like they've never set foot outside of their 300 acres or whatever.

I can think of a lot more who are no longer in office or no longer with us.

 

[Meadows]

I like this game, here are the ones I like/respect:

George Osborne: (CON) Sure he's a bit of a twat and incredibly posh but, most importantly, he has done a good job and the country is better for him.

Nick Clegg: (LIB) Did what was right for the country by forming the coalition and not holding it back by being too strong.

Vince Cable: (LIB) Puts his foot in it a lot but undoubtedly the best politician in terms of economic saavy in the country. Fantastic on all levels and a good bloke.

Tom Watson: (LAB) Unfortunate that he's a member of the Labour party because he's so talented. Hopefully Labour will change their ways and he can get the credit he deserves.

Jack Straw: (LAB) Along with Prescott probably only one of the New Labour lot that I really liked.

Nigel Farage: (UKIP) Pompous but loveable, sure he's hard right but he's a pretty nice guy and probably not racist.

Caroline Lucas: (GRN) She's pretty good at her job and makes the Greens look like a good, mainstream party. Don't agree with her on Nuclear energy though...

Hate:

Ed Balls: (LAB) Arrogant, horrible man who is wrong on Economics.
Harriet Harman: (LAB) Pretty much everything I hate about New Labour in one package.
George Galloway: (TWAT) Thinks he's important. He's not.
Lembit Opik: (LIB) His stupidity and horrible character lost the LDs a seat that was previously safe. Plus he did that pathetic comedy gig where nobody laughed.
Baroness Warsi: (CON) Why is she in the cabinet? Nobody likes her or elected her.
Diane Abbott: (LAB) See Harriet Harman.
Keith Vaz: (LAB) Weird anti-video game crusade, holds weird views.

 

[louis89]

Like:

David Cameron
George Osborne
Theresa May
Nigel Farage (though I would never vote UKIP)

Dislike:

Pretty much the entire Labour Party

 

[Meadows]

Just made an ePetition, if you agree with me then sign it/pass it on!

http://epetitions.direct.gov.uk/petitions/4219

Apologies for the numerous small grammar errors, I've been speaking pigeon English/teaching basic English to people for 2 months now and it's starting to get to me!

So what do people think? Should this be legislated for?

 

[killer_clank]

Just made an ePetition, if you agree with me then sign it/pass it on!

http://epetitions.direct.gov.uk/petitions/4219

Apologies for the numerous small grammar errors, I've been speaking pigeon English/teaching basic English to people for 2 months now and it's starting to get to me!

So what do people think? Should this be legislated for?

I agree. I'm currently stuck in this rut of barely receiving anything back, and it is indeed horrible.

Not sure if it could ever really be legislated for due to the fact if you don't hear back in 30 days you've probably been rejected anyways but it is a nice thought, and one that in an ideal world would be combined with an explanation as to why. That would improve the impetus to find work immeasurably if you were being told why you had failed, and then work to improve it. Actually, its does sort of kill 2 birds with one stone, an actual rejection so at least people know and proof to the job centre that benefit claimants are actually applying to jobs. Definitely an idea that warrants discussion.

Will sign.

 

[Mecha_Infantry]

So Killa Cam did his speech behind some graffiti

*pages David Starkey*

 

[Mecha_Infantry]

Shit this isn't the 90's

*tweets Starkey*

 

[zomgbbqftw]

Unemployment statistics came out today.

ILO unemployment is up to 7.9% from 7.7% caused by increased participation in the labour market which lead to absolute employment increased by just over 25k in the last three months, the headline unemployment rate is 2.49m. The claimant count also went up 37.1k but that is more down to a new test introduced by the government designed to get people off incapacity benefit to reduce benefit fraud.

The total participation rate increased from 70.6% to 70.7% and the economically inactive rate decreased too.

It's a mixed bag really. Good news about increased participation because people feel like they can get a job, but ILO rate going up is bad news. IB changes are going to mess with the claimant count for the rest of the year, but it's not really anything to worry about since the change isn't real, it's actually money saved for the government which will help reduce the deficit.

Tomorrow we get retail sales figures and on Friday the public sector net borrowing. Both will be anaemic at best. The economy is receding at the moment but the period won't be long enough to trigger a second recession.

In other news, EU idiots are discussing a financial transaction tax which is going to drive a lot of business and jobs from the financial sector in Europe out to Switzerland, US and Asia. If this government doesn't resist its introduction in London I expect I will not be a member of BritGAF next year as my job will move to Geneva or HK.

 

[Walshicus]

Gods, I hope we get a Tobin style financial transaction tax. Nothing would make me happier than to help neuter our "financial" sector.

 

[Meadows]

Gods, I hope we get a Tobin style financial transaction tax. Nothing would make me happier than to help neuter our "financial" sector.

.

I am 100% in favour of this tax. Look outside of your bubble of wealth and greed zomg.

 

[zomgbbqftw]

.

I am 100% in favour of this tax. Look outside of your bubble of wealth and greed zomg.

They tried it in Sweden in the 80's it destroyed their finance industry and a lot of capital investment in regular industries. It would be a complete disaster in this country since our finance industry is larger and the escape will be that much bigger and our crash that much bigger.

Sweden repealed the tax very soon after introducing it and they have pretty much said they will veto its introduction for non-EMU members as have the Treasury this afternoon.

Please remember that taxes collected from the banking and finance industry are absolutely massive and replacing that tax income would be impossible. Imagine the education budget suddenly disappearing from the government coffers with no way to replace it.

Let the EMU countries go after this folly and watch the business flow into London, New York, Geneva and Tokyo. I'm amazed that the Germans are even entertaining such an idea. France I get, their finance industry is not really big and they wouldn't lose very much by killing it, but we would and it would be a mistake to chase away business (and taxes) to 'punish greedy bankers'. You may not like it that people in this industry earn a lot, but we also pay a fuck ton in taxes.

I paid £30k in tax in the year just passed, if my job were to move to Geneva (and I would go with it, believe me) it would need six people working for the average wage to replace the tax income I generate for the government. Don't misunderstand my statement, I don't value what I do above others, I am talking specifically in facts and figures. Extrapolate that across the 200k people who work in the city and that most people get paid more than I do, and you see the problem. The government would be absolutely unable to replace the payroll taxes collected from the City and the corporation tax receipts that are about to come this year.

Like I have always said, taxes should be used to raise the maximum amount of money for government and public sector spending, which means having a balance. Taxes should never be used to punish rich or wealthy people as it just chases them away to other countries and you lose their tax income entirely. You should read up on the Laffer curve, that is the reason most countries have a top rate of tax set to around 40%, any more and you chase away business, any less and you don't get enough to run the government properly.

 

[Meadows]

Not being harsh or owt but you can fuck off to Switzerland for all I care. Not a slight against you, but my feelings on what you posted.

 

[zomgbbqftw]

Not being harsh or owt but you can fuck off to Switzerland for all I care. Not a slight against you, but my feelings on what you posted.

That's fine, but then the finance industry takes a lot of tax income with it. UK deficit up by £25bn, unemployment up, recession etc... this all happened in Sweden as well. The damage to the economy would be immense and I don't think it would be a good move for UK PLC as capital investment would die with it. Even Labour would have killed this in its tracks!

 

[Dambrosi]

Gods, I hope we get a Tobin style financial transaction tax. Nothing would make me happier than to help neuter our "financial" sector.

God no, I'm a diehard Socialist and even I think that's a bad idea.

The goal is to tax them just enough so that they pay their way, but it's still worth their while to stay in business in the UK and keep creating/sustaining jobs. The ideal is to make being socially responsible to the country pay dividends for everyone, including the corps.

Not that I even like corporations, for much the same reasons Meadows posted earlier. However, they exist, are legal, and must be tolerated.

 

[zomgbbqftw]

God no, I'm a diehard Socialist and even I think that's a bad idea.

The goal is to tax them just enough so that they pay their way, but it's still worth their while to stay in business in the UK and keep creating/sustaining jobs. The ideal is to make being socially responsible to the country pay dividends for everyone, including the corps.

Not that I even like corporations, for much the same reasons Meadows posted earlier. However, they exist, are legal, and must be tolerated.

Exactly the point I was making. Government should extract the maximum amount of tax without making the cost of doing business to high or burdensome that they leave for sunnier climes.

Interesting stuff about the 50% rate coming out now. People saying Osborne will get rid of it next budget, replace it with a new stamp duty rate for properties worth £1.75m or above and a special rate of capital gains tax for property based investments. Much better than the 50% rate as it will raise money without killing of entrepreneurial spirit since there is little to be had from property investment. All it does is serve to keep property prices too high for first time buyers and rents higher than they should be. I would support this move wholeheartedly (rare coming from me as I generally don't support tax increases) as property shouldn't be treated as a commodity.

 

[Parl]

Not being harsh or owt but you can fuck off to Switzerland for all I care. Not a slight against you, but my feelings on what you posted.

Are you saying it's inaccurate, or that you are content with the UK economy and tax revenue being hindered with essentially no gain. If what zomg is saying it accurate in the slightest, this is simply a lose-lose situation with no pragmatic reason to support it.

 

[Dambrosi]

Exactly the point I was making. Government should extract the maximum amount of tax without making the cost of doing business to high or burdensome that they leave for sunnier climes.

Interesting stuff about the 50% rate coming out now. People saying Osborne will get rid of it next budget, replace it with a new stamp duty rate for properties worth £1.75m or above and a special rate of capital gains tax for property based investments. Much better than the 50% rate as it will raise money without killing of entrepreneurial spirit since there is little to be had from property investment. All it does is serve to keep property prices too high for first time buyers and rents higher than they should be. I would support this move wholeheartedly (rare coming from me as I generally don't support tax increases) as property shouldn't be treated as a commodity.

As the whole financial mess we're currently in has made painfully obvious to everyone, hopefully.

Or, at least, one would hope that those with the money to care would learn not to make the same mistakes again. But it would seem that, no matter how much money they have, humans are inherently greedy and self-destructive.

That is, if you take the government's "sick society" rhetoric to its logical conclusion. I'd like to think we're somewhat better than that, but the public mood doesn't support it.

 

[radioheadrule83]

In other news, EU idiots are discussing a financial transaction tax which is going to drive a lot of business and jobs from the financial sector in Europe out to Switzerland, US and Asia. If this government doesn't resist its introduction in London I expect I will not be a member of BritGAF next year as my job will move to Geneva or HK.

A few questions...

Given transactions will still take place in large Western European democracies, as there is a lot of money and trade to be done here/there, is it realistic that everyone would just up and leave the City of London to fly off to some safe haven? And if so, is there a method perhaps - by which Europe could still put a levy on trades relating to European business (that take place outside of Europe)? Is any financial transaction tax too large or would a small one possibly be workable?

I can't imagine the logistical / infrastructure costs of trying to move an entire financial sector out of the country.. I can't imagine the sea of GMBH and British and French Euro-headquarters for big companies upping sticks and leaving really either. When it comes to workers like you -- is everyone going to be as prepared as you are to move? I'm not sure I buy the market exodus apocalypse story, but I'm happy to be convinced around if you can explain why it would happen to me

 

[zomgbbqftw]

A few questions...

Given transactions will still take place in large Western European democracies, as there is a lot of money and trade to be done here/there, is it realistic that everyone would just up and leave the City of London to fly off to some safe haven? And if so, is there a method perhaps - by which Europe could still put a levy on trades relating to European business (that take place outside of Europe)? Is any financial transaction tax too large or would a small one possibly be workable?

I can't imagine the logistical / infrastructure costs of trying to move an entire financial sector out of the country.. I can't imagine the sea of GMBH and British and French Euro-headquarters for big companies upping sticks and leaving really either. When it comes to workers like you -- is everyone going to be as prepared as you are to move? I'm not sure I buy the market exodus apocalypse story, but I'm happy to be convinced around if you can explain why it would happen to me

The plans are already in place for the bank I work for as they are for a lot of UK based banks. If Labour had won I expect the exodus would have started quite quickly.

It isn't that difficult to move anyway, in our case we would be ready to go in about a fortnight if required.

The reason it would happen is that only banks based in the EU could possibly have the tax enforced since the transaction needs to take place in an EU country for it to be applicable for the tax. If the bank suddenly upped sticks for Switzerland then a transaction that would previously have gone New York to Germany to Tokyo now goes New York to Geneva to Tokyo. The EU are entire ignored and with that the people who make the transactions go to Geneva. It's much easier than you think.

An EU business based outside of the EU is no longer an EU business despite whichever country it may have been founded in. If Barclays went to Switzerland tomorrow it would no longer be a British bank, it would be a Swiss bank. It would take some getting used to, but the fact would remain that corporation taxes paid by the bank would be there and most of the money making side would be there too. Sure they would still have retail banking here, but the head office would be no more than a big filing cabinet. Anyway, since a bank outside of the EU is not under any EU jurisdiction there would be no way they could enforce a levy, most finance houses would just ignore the EU entirely and keep the retail side going.

Also the last thing we as a country should be doing right now is pointing out that Asia isn't such a bad place to do business anymore. The city relies on the fact that we have had very, very friendly regulatory practices since the Bank was made toothless in 1997 by Gordon Brown and that Asia is not as friendly because China are the dominant power and they are somewhat unpredictable. It is my opinion (and only my opinion, not that of my employer) that Asia is a much better place to do business than the industry realises, there is nothing, in my mind, stopping Singapore from becoming the next City of London except perception and our (very) friendly neighbourhood regulators.

Last year around £5tn worth of forex transactions took place in the City, there is literally nothing stopping that being done in Switzerland except inertia. A financial transactions tax would give the banks enough inertia to move. Luckily our government is sensible enough to tell the EU to fuck off and make it EMU only if they want to try and catch smoke.

The reason I know this will happen? Sweden. The best case study of all. They introduced a unilateral transaction tax that the EU are contemplating and it left their economy in ruins. I would hate, hate to see it happen here. Sweden also did theirs in the 80's which was a much less globalised time and moving was much more difficult.

The only way this tax would work is on a truly global scale, and since Asia and the US would never, ever play ball it's a non-starter. That's why Brown loved to play it up to socialists, he knew it was an absolute non-starter but he could play up his leftist credentials to the party faithful while blaming the Americans for making it impossible to implement.

Osborne's balance sheet tax is about as far as we should go and because of its success (no banks have moved) I think other countries will introduce them in short order.

 

[Walshicus]

I suppose the question is "do we wan't an overpowered financial sector" and the only real answer I'd suggest makes sense is "no". It's not productive and as shown repeatedly, it's a liability. It exists to make a small number of people very rich, and functions to redistribute wealth away from the poor.

Financial services at their very best are a mechanism to efficiently distribute investment; mechanisms to maximise the efficiency of the real economy and real output. The current system is too complex, too tangled and broken that it provides no benefit to 99% of the people in this country.

 

[Meadows]

I suppose the question is "do we wan't an overpowered financial sector" and the only real answer I'd suggest makes sense is "no". It's not productive and as shown repeatedly, it's a liability. It exists to make a small number of people very rich, and functions to redistribute wealth away from the poor.

Financial services at their very best are a mechanism to efficiently distribute investment; mechanisms to maximise the efficiency of the real economy and real output. The current system is too complex, too tangled and broken that it provides no benefit to 99% of the people in this country.

co-signed.

 

[zomgbbqftw]

One of our actuary teams did a quick set of calculations on what the tax cost would be to this tax, they worked out £23bn minimum and £68bn as a maximum based on conservative projections on a capital flight out of the country from the Swedish example.

Let's take a middling estimate at £40bn. Where does the government find £40bn to replace money lost in the economy. It is also essentially £40bn for no outlay and no investment, the cost of the banking interventions will be made back and I say, as an employee of a bank that was no bailed out, please don't lump us all in with BoS and RBS. The rest of the UK banking industry was nowhere near as profligate. We posted losses in the first year of the crisis of around £8bn but since then no losses, and I think we we have set aside around £2bn for payment of taxes this year and the employees paid around £4bn in payroll taxes this year. Where in the UK will we find a company to replace that £6bn in taxes, and we're a single bank, sure we are one of the biggest, but even so...

If anyone can come up with a plan to grow the economy by 6% after the complete destruction of the finance industry then please post one. If someone can come up with a plan to cut spending by a further £40bn then I'm all ears, but I can't see what the government can cut further than they already have. Even stuff like Trident renewal is "only" £8bn over 10 years and this is £40bn lost year after year after year.

Any government cuts resulting from the annihilation of our finance industry would result in mass unemployment as government cuts bite. Don't forget that this country's financial boom allowed the previous government to take government spending to unprecedented levels, without the sector that spending would have to come down very fast leading to mass unemployment.

Whether people like it or not, the previous two governments have fostered a big powerful financial sector in this country and for better or worse there isn't much anyone will ever do about it, at least in the short term. Better and more effective regulation can make finance and banking more responsible and allow the rest of the economy to grow while banking growth slows which is an effective rebalance, but that process takes about 10-15 years. An instant rebalance would be a complete disaster. £40bn of instant government cuts would be devastating for all industries, I can't get that point across enough. It's such a big deal and such a disaster area for this country, I would hate to see 5m unemployed and a £200bn deficit.

From the FT about Sweden:

“It’s interesting to note that the Swedes introduced the tax in the 1980s and it caused 60 per cent of its 11 most actively traded stocks to migrate to London. By 1990 50 per cent of Swedish equities had followed.”

 

[Meadows]

Increase taxation, cut more spending. There you go.

And stop harping on about Sweden, there are numerous differences between the two cases. A precedent has been set by the Franco-German change. I really hope we follow.

If you wanna swan off to some tax-haven because you think a poor lad from Grimsby who wants to make a life for himself, or a poor girl from Bridgend doesn't deserve any of your hard earned money to be spent on her while she cares for her parents then you can piss off for all I care. The system helped you get where you are, you owe it some money. I'd gladly pay 40-50% tax on what I paid if I were earning over £35-40k because it would help others to make a life for themselves.

 

[zomgbbqftw]

Increase taxation, cut more spending. There you go.

So £1500 of tax on every single person who works, and that's still not enough. The resulting drop in spending would devastate our industries as well and lead to more job losses. Taxes in this country are almost at breaking point. There are some inventive areas that may produce up to £2bn without too much effect, but even an extra £20bn in tax rises and £20bn in cuts would be a very, very poor idea for the economy.

I'm not usually one for higher spending, however, £20bn in government cuts is the equivalent of 750,000 government jobs lost at the average wage and £20bn in tax rises is 3p on the basic rate, 1p on VAT and 1p on NI employer and employee which would cause lower consumer spending, or if you went for a more corporate oriented tax package then it would be 4p on small business, 2p on big business and 2p on employer NI contributions. The problem is that so many businesses would run away to Asia and not return it would cause a huge spike in private sector unemployment leading to a falling away of tax receipts and an increase in social security spending.

Trust me, even Labour see this as a terrible idea, they would kick this idea out as well.

If you wanna swan off to some tax-haven because you think a poor lad from Grimsby who wants to make a life for himself, or a poor girl from Bridgend doesn't deserve any of your hard earned money to be spent on her while she cares for her parents then you can piss off for all I care. The system helped you get where you are, you owe it some money. I'd gladly pay 40-50% tax on what I paid if I were earning over £35-40k because it would help others to make a life for themselves.

I do pay my taxes. £30k last year, £27k the year before, and this year it will be about £38k. I have never had a problem with paying my taxes. Have I left for Switzerland? No. If my job moves there I will have no choice, but right now I do have a choice to take Swiss residency and I have chosen not to take it. Please don't make this personal. I have never, ever once complained about paying taxes on my wages. Do I think they are a little high or spent poorly, sure, but I would never evade taxes by moving my residency.

On Sweden, do you really think that our trading, along with German and French trading, wouldn't just end up somewhere else. This is a globalised economy. Make no mistake that plans in the EMU are already being made to move trading to London and plans are being made all across the EU to move trading to Geneva. I have seen them.