Tory economic policy (or lack of?)

Does anyone think that the Tories refusal to cut taxes if in power, after 9 years of Labour tax rises, is right? They have even said tax rises are not inconceivable. Osborne is Shadow Chancellor, and it's a more important issue than the silliness over the autism comments!

[etccarmageddon]

they haven't refused to cut taxes - they have just stated that they will not commit to that agenda until they have seen the books.

The books are pretty open for all to see. And I have seen the Labour style high tax and spend ethos behind Cameron's thinking even if he hasn't supplied policies to go with them.

[TheNorm]

Originally Posted by etccarmageddon

they haven't refused to cut taxes - they have just stated that they will not commit to that agenda until they have seen the books.

Makes sense to me. Is a political party going to make promises that it can keep?

Originally Posted by freezin

The books are pretty open for all to see. And I have seen the Labour style high tax and spend ethos behind Cameron's thinking even if he hasn't supplied policies to go with them.

Are you a "Tory Mole", and is that how you have seen these "ethos" - or are you just going on what you have read in the papers?

[hatedbythemail]

what theyve said is economic stability is more important than pledging tax cuts. personally i think cameron is trying to establish a new identity for toryism and tax is one of the key ways of doing so. tebbit clearly took the bait judging by his tax slashing europhobic rant at a fringe meeting yesterday. so all the aged thatcherites will bleat on and cameron can claim to be distinct from that old style toryism with which voters no longer connect. its another lesson taken from the blair's big book of political tricks - its the tories clause 4 moment.

Originally Posted by foreverwar

Are you a "Tory Mole", and is that how you have seen these "ethos" - or are you just going on what you have read in the papers?

Why would anyone read newspaper reports (journalists are not exactly full of investigative zeal are they?) when there are several unadorned and recent speeches available for analysis?

Originally Posted by hatedbythemail

what theyve said is economic stability is more important than pledging tax cuts. personally i think cameron is trying to establish a new identity for toryism and tax is one of the key ways of doing so. tebbit clearly took the bait judging by his tax slashing europhobic rant at a fringe meeting yesterday. so all the aged thatcherites will bleat on and cameron can claim to be distinct from that old style toryism with which voters no longer connect. its another lesson taken from the blair's big book of political tricks - its the tories clause 4 moment.

I read about the need for economic stability and it is without doubt very important. But Cameron's "Let the Sunshine win the day" Tories sound like Labour clones, and after 9 years of Labour tax rises they should be downright embarrassed not to be able to promise tax cuts.

Can you be more specific about why you disagreed with Tebbit's speech yesterday? To call it a europhobic rant isn't adding much to the debate.

[hatedbythemail]

Originally Posted by freezin

Why would anyone read newspaper reports (journalists are not exactly full of investigative zeal are they?) when there are several unadorned and recent speeches available for analysis?


I read about the need for economic stability and it is without doubt very important. But Cameron's "Let the Sunshine win the day" Tories sound like Labour clones, and after 9 years of Labour tax rises they should be downright embarrassed not to be able to promise tax cuts.

Can you be more specific about why you disagreed with Tebbit's speech yesterday? To call it a europhobic rant isn't adding much to the debate.

tebbitt demanded tax cuts and said one way to pay for them was to pull out of the eu.

ok, im against tax cuts for a number of reasons - education (can't even pay for proper school meals, reliant on pfi for new build schools, charging for higher education etc), youth services (grossly underfunded), social services (grossly underfunded), pensions (gaping hole and minimal state support).... etc etc.

im for a fairer tax regime which would include reversing many of the indirect taxes levied by labour which disadvantage the poor and ensuring higher earners (and in particular the highest) pay their way by ensuring loopholes are closed and that a new higher rate band kicks in. hope thats enough explanation.... sure to arouse the passions of a few here i should think ;-)

[Stu038]

Originally Posted by hatedbythemail

im for a fairer tax regime which would include reversing many of the indirect taxes levied by labour which disadvantage the poor and ensuring higher earners (and in particular the highest) pay their way by ensuring loopholes are closed

No disagreement from anyone there I think

Originally Posted by hatedbythemail

and that a new higher rate band kicks in.

Hmmm not quite as convinced of that one, I'm don't see why anyone who is successful should be penalised for it, all that will happen is that many will sod off abroad and earn the money elsewhere instead. Many high earners generate more growth and indirect revenue for the economy than they would pay in taxes so why force them out

I seem to recall something daubed by the press of the time as the Brain Drain happening in the 70s.

[SlackDad]

Originally Posted by Stu038

Hmmm not quite as convinced of that one, I'm don't see why anyone who is successful should be penalised for it, all that will happen is that many will sod off abroad and earn the money elsewhere instead. Many high earners generate more growth and indirect revenue for the economy than they would pay in taxes so why force them out

Of course, why would anyone want to put any more back into the system that has provided so well for them? That would be so unjust

Originally Posted by hatedbythemail

tebbitt demanded tax cuts and said one way to pay for them was to pull out of the eu.

Hardly suggestive of a 'europhobic rant'. However, leaving the EU, and with it the CAP which hits the poor a lot harder than it does the rich, would certainly help, but there are other ways a country run properly for the benefit of its inhabitants could make changes. Making real changes would mean leaving the EU, because most of our laws (at least 70%) now come from its institutions, and we mostly follow EU approved policies.

Originally Posted by hatedbythemail

ok, im against tax cuts for a number of reasons - education (can't even pay for proper school meals, reliant on pfi for new build schools, charging for higher education etc), youth services (grossly underfunded), social services (grossly underfunded), pensions (gaping hole and minimal state support).... etc etc.

So you are against tax cuts for the traditional socialist reasons? OK fair enough, I can respect that although not being a socialist I don't see things the same way. I disagree with PFIs for hospital and schools funding too. Did you know that PFIs were introduced in 1992 to comply with the EU's convergence criteria, a requirement of the Maastricht Treaty? I also disagree with higher education charges (and this is a personal issue for me as I have 4 children). And imo many public services are grossly underfunded because they are grossly overused partly as a result of crap government policies. As you have found such faults with the present system, I take it you are not a Labour voter any more than you are a Tory one ...?

Originally Posted by hatedbythemail

im for a fairer tax regime which would include reversing many of the indirect taxes levied by labour which disadvantage the poor and ensuring higher earners (and in particular the highest) pay their way by ensuring loopholes are closed and that a new higher rate band kicks in. hope thats enough explanation.... sure to arouse the passions of a few here i should think ;-)

I'm also for a fairer tax regime, but what is 'fair' is a political issue. Some people having to contribute close to half (or more) of their earnings to the state, whilst other perfectly capable people are allowed to sit back and do nothing on the flimsiest of excuses, is obscene. That is not to say that I want the weak or vulnerable to be harrassed into working, or the sick to have to wait months for hospital treatment either, etc, etc.

Originally Posted by freezin

So you are against tax cuts for the traditional socialist reasons? OK fair enough, I can respect that although not being a socialist I don't see things the same way. I disagree with PFIs for hospital and schools funding too. Did you know that PFIs were introduced in 1992 to comply with the EU's convergence criteria, a requirement of the Maastricht Treaty? I also disagree with higher education charges (and this is a personal issue for me as I have 4 children). And imo many public services are grossly underfunded because they are grossly overused partly as a result of crap government policies. As you have found such faults with the present system, I take it you are not a Labour voter any more than you are a Tory one ...?.

"Traditional socialist reasons" - I would call them common-sense reasons, myself, and I have voted Tory all my life. It's just like running your household - you work out your income, calculate your outgoings, and anything left over, you have to make decisions on what to do with it. You could just go down the pub (tax-cuts), or you could save up the money and invest it in your house, thus investing in the future.

If we must have tax-cuts, they should be focussed on the less well paid, and we should raise the tax threshold, and lower the bottom rates of tax to distribute the money to those who need it most - lower-paid working people (you should like this, as the "work-shy scroungers" don't benefit).

Let's look at the figures -
The first £5,035 of income is the Personal Allowance and is therefore taxfree.

• Starting rate of 10% on income up to £2,090;
• Basic rate of 22% on income between £2,091 and £32,400; and
• Higher rate of 40% on income over £32,400.

Bearing in mind that these income tax rates are applied to the income after deducting the tax-free Personal Allowance, it follows for example that, say, an employed person with no other income could receive (£32,400 + £5,035) = £37,435 this tax year before paying higher rate tax.
The actual tax due would be calculated as follows:
The first £5,035 of income is the Personal Allowance and is therefore taxfree.
The next £2,090 is taxed at 10% (tax of £209). The next band of income between £2,091 and £32,400 is taxed at 22% (tax of £6,668). The total tax payable would therefore be £6,877 (£209 plus £6,668). So for someone earning nearly twice the national average wage, his income tax would be under 20% of his salary (I know you have to take off NI of 11% as well).

If we dropped the higher-rate tax to 35%, that means (roughly) someone earning over £37k pa would be £1 per week better off for every thousand pounds they earned over £37k, so if they earned £45k a year, they would be £8 per week better off. Don't you agree this £8 per week would be more useful to someone earning the minimum wage of £5 per hour, £10k per year - it would make a big difference to them, and (usually) only a small difference to someone on £47k pa.

Originally Posted by freezin

I'm also for a fairer tax regime, but what is 'fair' is a political issue. Some people having to contribute close to half (or more) of their earnings to the state, whilst other perfectly capable people are allowed to sit back and do nothing on the flimsiest of excuses, is obscene. That is not to say that I want the weak or vulnerable to be harrassed into working, or the sick to have to wait months for hospital treatment either, etc, etc.

Before I was made redundant, I earned a reasonable amount of money (well over the higher rate threshold, with company car, fuel, etc) - my monthly total "tax" bill (income tax and NI) was not above 38%, so it would be interesting to see where your "close to half" figure comes from.

I also fail to see your connection between tax cuts and people "scrounging off the state" - if there is an issue with "scroungers", get it sorted out, then if there are cost-savings because of this, then decide how these should be allocated. Standard household budgeting rules (or they should be, imho) - don't spend the money before you have earned/saved it.

btw, 12% of tax-payers pay the higher rate of income tax, and when I am working, I am one of them, and proud of it; I see it as paying for the future, for my children, and other's children - I wish sometimes it was spent more wisely, but with rising expectations of the electorate, and short-termism the name of the game in politics and business, that won't be easy to change.

[hatedbythemail]

that was a rather good post foreverwar :-) cant rep you for it which means you must have made sense elsewhere recently ;-)

im a higher rate tax payer and dont begrudge it. but i watch friends struggle by on minimum wage, or wading through tax credit forms, or battling with the csa to try scrape cash together to support their kids. im ashamed that our country, one of the world's richest, allows such a shabby state of affairs.

This thread contains posts split from the Osborne/Autism discussion.

[danielf]

Excellent post Foreverwar...

To put the debate into perspective, Tax levels in the UK are not high compared to the continent (cost of living is though). I used to pay 50% (inc NI) on any earnings over ~25k (this was a few years back). In return for these higher levels of taxation, you get properly funded public services. If the British public want public services comparable to those in many countries on the continent, you know how to get it: pay for it through taxation. What many Brits seem to want is continental levels of public service at US levels of taxation. Guess what: It aint gonna work.

I am very much in favour of (as foreverwar suggests), increasing the higher threshold for the starting rate (thus making it more attractive for low wage earners to work, as opposed to claiming benefits, and increasing taxation on higher earners by either increasing the higher tax rate, or lowering the threshold for the higher rate. This will mean I will be paying more tax, but I will be quite happy to do so if it means better public services.

Now someone will undoubtedly claim that public services will work better by cutting waste/bureacracy. This is probably true. However, unless you're willing to accept that the Brits are simply more wasteful/bureaucratic than the rest of Europe, it still seems there is a funding gap.