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Falling Tax Revenue Hitting Budget

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Falling tax revenue hitting budget

The runaway cost of Chancellor Alistair Darling’s temporary 2.5 per cent cut in VAT combined with something approaching a collapse of revenues from corporation tax is already pressing hard on the Chancellor’s Budget arithmetic for the 2009/10 tax year.

In April his forecast that public spending would exceed the yield of taxes by £175 billion drew gasps of horror.

Yesterday official numbers showed that net borrowing had reached £30.5 billion in the first two months of the tax year – equivalent to £183 billion over a full year. That took net debt to £774.8 billion, equivalent to 54.7 per cent of Britain’s gross domestic product.

Collapsing tax revenues are doing more damage than public spending.

VAT receipts were 23 per cent behind those in May last year at just over £6 billion. Corporation tax fell by 27 per cent over the first two months of this tax year to £5.2 billion.

Income tax and capital gains tax were nearly 11 per cent down in May at £8.7 billion.

Heavily taxed, consumption based economy stops consuming...result!

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Collapsing tax revenues are doing more damage than public spending

A drop in income is always damaging but what is always worse is sticking your head in the sand pretending it will all go away.

By ignoring a damaging situation this Goverment is turning it into a catastrophy.

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Falling tax revenue hitting budget

Heavily taxed, consumption based economy stops consuming...result!

I did a search a few months ago on Yahoo for CEBR 10%, but you no longer get the link, you have to search

CEBR EXPECT THE HOUSING MARKET TO CRASH SOON and you get this link:

CEBR LINK

It was a report from March 2009 about loss of revenue from the financial sector :

Tax revenue from financial service sector down by £28 billion equivalent to four fifths of the entire defence budget

.............The Chancellor is set to lose £9 billion in corporation tax revenue, £10 billion from less income tax and National Insurance contributions, £2 billion from stamp duty and £3 billion from withholding tax. Adding in all the other sources of revenue, the total tax take is forecast by cebrto drop from £67 billion to £39 billion. Moreover, some of these hits are likely to be long lasting. The scale of the losses that the banks can bring forward means that they will have to pay little corporation tax for many years. Our forecasts indicate that job numbers and bonuses will remain depressed until 2013 atleast. Our tentative forecast is that the tax take will rise toonly £46 billion by 2012/13..............

This hit on tax receipts is a real blow to Chancellor Alastair Darlings budget hopes. His predictions in the Preâ€Budget Report do not appear to have factored in more than half of the tax revenue decline for 2009/10 and there is little evidence that the longevity of the problem is yet fully understood in the fiscal part of the Treasury............

Edited by Sybil13

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Where do they get their money from?

Duh! Where have you been since '97?

They borrow it of course. We already know that debt = wealth, so the more you tax the unemployed the better off they are!

With this new found (unearned) wealth, the unemployed have the confidence to spend again.

So there you have it, tax the unemployed to generate a massive boost for retail sales and the economy at large.

Edited by Nick Dastardly

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The answer clearly is more tax.

Tax everything that moves it's the only way.

"Dear Mr Interestratesaripoff,

It has been brought to our attention that you contributed 8,246 posts

to an internet forum, during the last fiscal period, without paying the relevant

statutory Forum Update Contribution Knowledge tax and Offset Formative

Fiscal tax.

We look forward to you redressing this situation and assisting us with your

F.U.C.K. O.F.F. contributions.

Yours sincerely,

The Inland Revenue."

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"Dear Mr Interestratesaripoff,

It has been brought to our attention that you contributed 8,246 posts

to an internet forum, during the last fiscal period, without paying the relevant

statutory Forum Update Contribution Knowledge tax and Offset Formative

Fiscal tax.

We look forward to you redressing this situation and assisting us with your

F.U.C.K. O.F.F. contributions.

Yours sincerely,

The Inland Revenue."

Seriously, that's nearly 30 posts every single day for a year!!!

No way does IRRO have a job?

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Seriously,

If you're that serious, 57, I suggest you don't read any more of my posts :lol:

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Where do they get their money from?

You tax them against future earnings, and the govt borrowers the money as it can pay it back with future tax income from said individual.

Tax none workers a flat fee of say £100 a week for being idle and watch them scurry back to work to avoid the tax.

This plan is flawless.

To be taxed you just need to be not in work and in working age. It would certainly screw the early retirement group.

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