[Ignitionnet]

Originally Posted by danielf

I'm still not convinced it's anti-growth. While low earners may not be the 'engine', they are far more likely to spend the extra income they receive. For many (by no means all) high earners the reduction (which incidentally is £300 rather than £500 as I forgot to take the increased personal allowance into consideration) will simply mean less savings. And I don't think it's disingenuous to say that at all, as I'm simply comparing to last year. We are all facing cuts in real terms. The fact that you've been paying more for longer is neither here nor there.

I have my doubts that most higher earners are saving - zero incentive to right now, they are investing. There's less money for them to invest with.

No idea of the net impact of the policy as a whole, but taxing one income group to supply tax cuts to the other, regardless of which direction up the income scale, is wrong.

Originally Posted by danielf

Ermm, yes. As a country we are facing the most brutal cuts in public spending for generations. It seems a bit silly (or rather egotistical) to me to simply suggest more cuts as the magic bullet. We are all in this together, and the cuts were going to be brutal but fair.

After the most sustained increase in spending for generations. More cuts are absolutely the way things should go, many other things that should be chopped to reduce the state further in size. Even post-cut 40% of national income is too large.

Originally Posted by danielf

I don't know. All I'm saying is that we should all share some of the pain and contributing an additional £300 isn't the end of the world, and it's certainly not anti-growth when it pays for putting money in the pockets of people that, on average, are more likely to spend it.

It's not the end of the world, of course not, but it's another tax increase on a pile of them over the last 14 years that there's absolutely no need for.

All tax increases are anti-growth, whether the increase in consumption from those less well off offsets it or not I do not know, we'll see.

Originally Posted by danielf

I've never stated you are super-rich, and I appreciate that money may be tight even on a high salary. I'm a bit puzzled about the housing comment though. Being the Libertarian that you are, you presumably have a choice in where you live (and work)? I seem to recall you extolling the virtues of renting a home rather than being one on account of your flexibility on the job market not too long ago?

Of course I chose to live here, however my point was that income and essential expenditure can be quite related. I am paid more because it is more expensive to live in this part of the country, so while my income is higher my outgoings are likewise higher.

I have little flexibility right now actually for family reasons, can't move too far

Originally Posted by danielf

Oh, I appreciate that you copied the thread title from the Telegraph, but don't you think 'LIBCON Middle Class Tax Squeeze' would be more appropriate? The tax cut may be the result of a LibDem manifesto pledge, but at the end of the day, it's a coalition measure.

You are absolutely right there. This is the action of both the Lib Dems and their pretend Conservative coalition partners.

FYI I would actually have absolutely no issue with the government running up deficits if they were incurred through cutting taxes along with services in order to balance the economy back to its historical footings, and I remain utterly convinced that the deficit should be wiped out through 100% cuts not 80% cuts 20% tax increases.

These cuts are poorly thought out, which is frustrating as hell. They could be done so much better and cause far less grief for people even if they were 25% larger, but that would require competent government along with a civil service that serves only the populace rather than itself and it's been a while since we had either of those.