Jump to content
House Price Crash Forum
Sign in to follow this  
pajd

How Many Houses Does John Redwood Own?

Recommended Posts

http://news.bbc.co.uk/1/hi/programmes/the_daily_politics/8706181.stm

The senior Conservative backbencher John Redwood has written to the Treasury with a warning that a large rise in Capital Gains Tax could damage the economy.

The former minister spoke out amid suggestions the current rate of 18% on windfalls could be increased to match income tax rates in the forthcoming emergency budget.

Share this post


Link to post
Share on other sites

He's a good guy. I don't completely agree with him, but his ideas are worth listening too.

There are too few politicians who believe passionately about something, it's just a job to them. Sad that he's not got a more prominent role.

Also I emailed a few politicians last week moaning about stuff, my local MP wrote a letter back - completely missing the point - JR emailed me straight back personally.

Share this post


Link to post
Share on other sites

You are John Redwood and I claim my £5.

He's a good guy. I don't completely agree with him, but his ideas are worth listening too.

There are too few politicians who believe passionately about something, it's just a job to them. Sad that he's not got a more prominent role.

Also I emailed a few politicians last week moaning about stuff, my local MP wrote a letter back - completely missing the point - JR emailed me straight back personally.

Share this post


Link to post
Share on other sites

Well, let's look at what he said (strictly speaking such niceties are unnecessary on HPC, I know, but indulge me B))

Mr Redwood wrote: “I therefore suggest that longer term gains should be taxed at lower rates. If you taxed 2 year gains at 30 per cent and three year gains at 20 per cent, higher rates than the current one, you could tax gains of four years or more at 10 per cent. “This should increase the total revenues from CGT by the second year, and offer a stimulus to longer term investment. I would myself go further and offer no capital gains after five years, to send a strong signal to the world’s investors that the UK is back in business as a favourable location.”

Mr Osborne and David Cameron have faced a backlash over the plans to raise CGT levels as there was no mention of it in the Tory election manifesto. Instead it was inserted as part of the coalition pact with the Liberal Democrats.

Mr Redwood is considered one of the most knowledgeable tax experts on the Tory benches and has advised Mr Osborne in opposition on economic competitiveness.

He told Mr Gauke that he has been “swamped” with support for his suggestions “both from around the country and from Conservative MPs.”

He added: “It would send a strange signal if a Lib/Con government decided to more than double the CGT rate set by a Labour government.

"It would damage the revenues and be unfair to anyone who saves, is prudent, or who ventures their money for the greater good.”

Capital gains may or may not be windfalls; whoever wrote the quote in the OP seems to be deliberately using loaded language to create spin (New Labour trained/supporting, perchance?).

We need some mechanism to distinguish gains that come from productive investment, from the casino-winnings of speculation. For some kinds of holdings (that finance wealth-creating enterprises, basically) time-based taper relief could be one way of doing that.

Share this post


Link to post
Share on other sites

He's a good guy. I don't completely agree with him, but his ideas are worth listening too.

There are too few politicians who believe passionately about something, it's just a job to them. Sad that he's not got a more prominent role.

Also I emailed a few politicians last week moaning about stuff, my local MP wrote a letter back - completely missing the point - JR emailed me straight back personally.

I agree with you but on this one he's really saying that his mates who benefited most from the cut to 18% would rather someone else paid the bills. Very predictable and disappointing.

Share this post


Link to post
Share on other sites

We need some mechanism to distinguish gains that come from productive investment, from the casino-winnings of speculation.

I would have thought the income vs. capital gains distinction did the job pretty well.

Share this post


Link to post
Share on other sites

We need some mechanism to distinguish gains that come from productive investment, from the casino-winnings of speculation. For some kinds of holdings (that finance wealth-creating enterprises, basically) time-based taper relief could be one way of doing that.

Some of the least productive and most parasitic 'investments' are long term real estate speculations

Edited by Stars

Share this post


Link to post
Share on other sites

Some of the least productive and most parasitic 'investments' are long term real estate speculations

agreed...high CGT for speculation and gamblers that does not benefit the good of the many...low CGT for profitable businesses that provide real growth and employment for many....there is no argument...Mr R must have a VI or friends with VI's. ;)

Share this post


Link to post
Share on other sites

Some of the least productive and most parasitic 'investments' are long term real estate speculations

And yet if, like many thousands (maybe even millions) of people have done over the years, you opened a dress shop, or a hairdressers or a sandwich shop - you may well find it helpful that you can rent the premises to carry on your business, rather than finding the money to build or buy the premises yourself.

Share this post


Link to post
Share on other sites

And yet if, like many thousands (maybe even millions) of people have done over the years, you opened a dress shop, or a hairdressers or a sandwich shop - you may well find it helpful that you can rent the premises to carry on your business, rather than finding the money to build or buy the premises yourself.

Not talking about rental income, talking about capital gain. ;)

Share this post


Link to post
Share on other sites

And yet if, like many thousands (maybe even millions) of people have done over the years, you opened a dress shop, or a hairdressers or a sandwich shop - you may well find it helpful that you can rent the premises to carry on your business, rather than finding the money to build or buy the premises yourself.

Of course -

long term price speculation in real estate makes both options more expensiove than they need to be.

Share this post


Link to post
Share on other sites

I would have thought the income vs. capital gains distinction did the job pretty well.

Compare the capital gain on a BTL during a HP bubble vs the capital gain accruing to the long-term backers of a business that makes a wealth-creating innovation.

Edit: there's a strong case for applying taper-relief in the second case, none for applying it in the first. I'd be interested to know Mr Redwood's view on this; judging by the comments on this thread there seems to be an assumption that he's proposing "one-size-fits-all" that would let the BTLer off the hook, too. Personally I suspect he'd be more nuanced than that. Regardless, throwing taper-relief into the toolset for dealing with the "investment in productive assets" issue seems useful to me.

Edited by huw

Share this post


Link to post
Share on other sites

Compare the capital gain on a BTL during a HP bubble vs the capital gain accruing to the long-term backers of a business that makes a wealth-creating innovation.

Very good comparision - but the important distinction here is not long vs short term, it is land price capture vs creating wealth

Share this post


Link to post
Share on other sites

http://news.bbc.co.uk/1/hi/programmes/the_daily_politics/8706181.stm

The senior Conservative backbencher John Redwood has written to the Treasury with a warning that a large rise in Capital Gains Tax could damage the economy.

The former minister spoke out amid suggestions the current rate of 18% on windfalls could be increased to match income tax rates in the forthcoming emergency budget.

John Redwood is no fool. But the essential point being missed is that the reduction in CGT to 18% (a rate well below that which the Cons left in 1997) was a recent change made by Darling. To put back what existed just over 2 years ago will not damage anything. Most assets bought and subject to any meaningful CGT would have been bought when it was 40% top rate. It will not damage the economy to put those rates back! It is now essential to reduce the deficit to save the economy. So those with the most must assist more than others. You do not necessarily have to sell the asset and there is rollover relief and business asset relief and annual allowances and even indexation allowance if held before 1982. It's not some supertax. I'm no leftie, but now is not the moment to moan about this.

IF there was no CGT then wealthy folks have their accountants make income appear as capital gains to pay no, or less tax. That's why it exists and why Chancellor Lawson intelligently made it match the income tax rates up to 40% in 1987 or 8. (UNFORTUNATELY he let a bubble play havoc with us about then too and hey presto shares then property crashed thereafter)

Share this post


Link to post
Share on other sites
Guest sillybear2

He's a good guy. I don't completely agree with him, but his ideas are worth listening too.

He wouldn't want to live in his utopia even if he could, the only problem with his ideology is the fact the underclasses would soon adopt similar reasoning and tar and feather his ilk whilst pi$$ing all over their precious private property rights. Forget about complaining about the chavs scamming benefits to spend on beer, tobacco and lottery tickets, if they woke up and compromised the integrity of things like the enclosure acts and dishonoured paper promises then the rich would really understand how well they currently have it.

Society and the exercise of power is all about force v. consensus, and he makes no consideration for the latter whilst assuming he would have a monopoly on the former, it's naive and foolish. Beware of kicking sleeping dogs, those with little have nothing to lose, those with a lot risk everything.

For example, those who cannot even afford their first home have very little sympathy for those wanting huge tax breaks on unearned gains on second, third or a whole portfolio of properties. A decade ago you could get away with gifts to the rich under the guise of it benefiting "everyman" at some stage, but that scam has been blown apart.

The banks and the housing speculators are the one's who brought the whole edifice tumbling down, so it's only right both should be heavily taxed to make good the losses in this zero-sum game. Dumping the losses on the national debt and younger workers whilst protecting tax breaks for what amounts to further intergenerational theft will implode sooner rather than later.

Edited by sillybear2

Share this post


Link to post
Share on other sites

Compare the capital gain on a BTL during a HP bubble vs the capital gain accruing to the long-term backers of a business that makes a wealth-creating innovation.

I find it to be a tricky one but I would assume a wealth creating business to be an income generator. This business could return its income to its shareholders (dividends taxed as income) and would also see its share price increase on the expectation of higher future income flows, but what is the benefit of having a difference between the two?

Share this post


Link to post
Share on other sites
Guest sillybear2

John Redwood is no fool. But the essential point being missed is that the reduction in CGT to 18% (a rate well below that which the Cons left in 1997) was a recent change made by Darling. To put back what existed just over 2 years ago will not damage anything. Most assets bought and subject to any meaningful CGT would have been bought when it was 40% top rate. It will not damage the economy to put those rates back! It is now essential to reduce the deficit to save the economy. So those with the most must assist more than others. You do not necessarily have to sell the asset and there is rollover relief and business asset relief and annual allowances and even indexation allowance if held before 1982. It's not some supertax. I'm no leftie, but now is not the moment to moan about this.

Neither was Brown, one of his final acts was to reduce CGT whilst kicking the low paid in the nuts by abolishing the 10% tax. That along with providing a blank bailout cheque to some of the richest people in the country of course, so the same people he previously knighted could avoid their gambling debts whilst retaining all their entitlements.

CGT was basically lowered so private equity groups could extract their special dividends after they'd finished raping and leveraging up a company, under our f****d up value system such plundering and chronic short-termism passes for 'entrepreneurialism'.

Edited by sillybear2

Share this post


Link to post
Share on other sites

I find it to be a tricky one but I would assume a wealth creating business to be an income generator. This business could return its income to its shareholders (dividends taxed as income) and would also see its share price increase on the expectation of higher future income flows, but what is the benefit of having a difference between the two?

Liquidating the shares would lead to a big chunk of "income" that could trigger an excessive tax liability, compared to receiving the income over many years.

The same factor might lead companies to distribute profits as dividends, rather than using them to increase its value.

Share this post


Link to post
Share on other sites

I find it to be a tricky one but I would assume a wealth creating business to be an income generator. This business could return its income to its shareholders (dividends taxed as income) and would also see its share price increase on the expectation of higher future income flows, but what is the benefit of having a difference between the two?

Profit does not equal wealth generation (not presently anyway)

A wealth generating business is one that creates wealth rather than merely enclosing or shifting the ownership of wealth created by others

Some glass-case examples of not creating wealth :

A man who breaks a town's windows at night and charges the town folk for replacements the next day, has generated a profit but created no wealth

A man who sits on the ownership of city centre land for twenty years while those working around his site raise the land's market price with their work, has generated a profit but created no wealth.

Edited by Stars

Share this post


Link to post
Share on other sites

http://news.bbc.co.uk/1/hi/programmes/the_daily_politics/8706181.stm

The senior Conservative backbencher John Redwood has written to the Treasury with a warning that a large rise in Capital Gains Tax could damage the economy.

The former minister spoke out amid suggestions the current rate of 18% on windfalls could be increased to match income tax rates in the forthcoming emergency budget.

Yes, got quite annoyed when I first read this, in fact an overtimed digestive broke off and dropped into my coffee, which really p**sed me off!

Having sorted out the digestive issue, well nearly, you can never get all of it out, can you? I realised that JR is just another VI gobbing off because he can see him taking a hit.

If Cameron and Clegg are even suspected of being influenced by these dinosaur has beens their tenure will be very short indeed.

IOW SHUT UP YOU TOSSER AND GET BACK IN YOUR BOX.

There, much better :)

Edited - Soggy digestive on keyboard :(

Edited by Agent Provocateur

Share this post


Link to post
Share on other sites

Profit does not equal wealth generation (not presently anyway)

A wealth generating business is one that creates wealth rather than merely enclosing or shifting the ownership of wealth created by others

Some glass-case examples of not creating wealth :

A man who breaks a town's windows at night and charges the town folk for replacements the next day, has generated a profit but created no wealth

A man who sits on the ownership of city centre land for twenty years while those working around his site raise the land's market price with their work, has generated a profit but created no wealth.

The guy who breaks windows at night would be in trouble because there are laws that punish wealth destruction so that example doesn't quite work for me.

The landowner who just sits there will generate capital gains and no income so should be taxed at least as much as the income generating chap?

Or am I missing your point completely?

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 261 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.