Budget - Aren't We Going To Have A Thread

[pathfinder]

I guess I am feeling a bit poor, a really big ticket once a year purchase for me is something like 50 quid. In January it would cost me an extra quid and some coppers?

omg omg omg argh aragh hello, HELLO, taxi get me to the shops pronto. What the hell is that harpy prattling on about the poor dont give a damn, look at the ground for some pocket lint or just go without? Oooooooooooooh its veiled rant for the middle M&S brigade after all.

[Angela]

http://www.hm-treasury.gov.uk/junebudget_easyread.htm

Details

[R K]

Shock, horror ! Tories go easy on tax (cgt) most likely to affect themselves and other tories, whilst dishing out the pain to everyone else.

Plus ca change !

Eh? It was 18% under labour.

It's now 28% under the Tories.

I make that 55% more tax paid under Tories than Labour.

Funny how people's minds work.

[Lennon]

Not sure about inflation rising - there appears to be a move to mapping things across to CPI - so would indicate that they would be wanting to keep that low... tough balancing act.

[DeepLurker]

Not sure about inflation rising - there appears to be a move to mapping things across to CPI - so would indicate that they would be wanting to keep that low... tough balancing act.

I guess that the big unknown is: are the government banking on a HPC "what started in America, not our fault" which would strangle all the benefits newly index-linked to CPI.

[The Generation Game]

Eh? It was 18% under labour.

It's now 28% under the Tories.

I make that 55% more tax paid under Tories than Labour.

Funny how people's minds work.

Indeed (taken from the budget blog on the beeb).

1352

John from Pembrokeshire writes: Reducing housing benefit to £400 is going to make thousands of people homeless. Where can you rent a three or four-bedroom property for that sort of money? This government is an absolute disgrace - they have hit the poorest and most vulnerable the hardest.

So £400 pw is ~ £1800 pm.

Let's check rightmove:

http://www.rightmove.co.uk/property-to-rent/find.html?searchType=RENT&locationIdentifier=REGION^61318&insId=1&radius=0.0&displayPropertyType=&minBedrooms=4&maxBedrooms=4&minPrice=&maxPrice=&maxDaysSinceAdded=&retirement=&sortByPriceDescending=&_includeLetAgreed=on&primaryDisplayPropertyType=&secondaryDisplayPropertyType=&oldDisplayPropertyType=&oldPrimaryDisplayPropertyType=&letType=&letFurnishType=&houseFlatShare=false&x=49&y=18

Some people just do anything to get themselves worked up.

[kenny dalglish]

Eh? It was 18% under labour.

It's now 28% under the Tories.

I make that 55% more tax paid under Tories than Labour.

Funny how people's minds work.

It was a disgrace under Labour. It was also the single easiest way to reduce HPC and the need for excessive housing benefits, to my mind it should have been brought in line with the higher rate of taxation, which is what I believe the libs wanted/promised. It was also the single most unpopular tax rise amongst influential tories and hence why it was watered down. Remember please that this is a tax on GAINS....

[Alfie Moon]

I think previously 40% could be tapered down to 24%.

[/quote

It would be good to see some worked examples of the maths comparing the 2 scenarios (28% with no taper relief Vs 40% with taper relief) for BTL'ers who sell after 5, 10, 15 years.

I read somewhere (although this would need to be checked via more reliable sources as to whether this is correct or not - that under the old CGT regime (ie 40% with taper relief) that the average CGT bill for BTL'ers/2nd home owners was 18% ...... if true then the new flat rate of 28% with no taper relief is going to see a significant rise in CGT bills for BTL'ers compared to the old regime or indeed if George had raised CGT to 40% with taper relief in this Budget.

Also, it must now be a worry for BTL'ers that CGT is going to be raised in increments - perhaps to 35% next budget and then 40% the Budget after that (and raising CGT with no taper relief or indexation now has a precedent).

I don't think this Budget is as much 'good' news for BTL'ers as our first responses seem to indicate, nor as much 'bad' news for HPC'ers that were hoping CGT would be raised to 40% as first seems. I suspect that if George had gone for the full rise to 40%/50% then it would almost certainly have been with taper relief.

Is the 28% as much of a compromise as it first appears?

[kenny dalglish]

I think previously 40% could be tapered down to 24%.

[/quote

It would be good to see some worked examples of the maths comparing the 2 scenarios (28% with no taper relief Vs 40% with taper relief) for BTL'ers who sell after 5, 10, 15 years.

I read somewhere (although this would need to be checked via more reliable sources as to whether this is correct or not - that under the old CGT regime (ie 40% with taper relief) that the average CGT bill for BTL'ers/2nd home owners was 18% ...... if true then the new flat rate of 28% with no taper relief is going to see a significant rise in CGT bills for BTL'ers compared to the old regime or indeed if George had raised CGT to 40% with taper relief in this Budget.

Also, it must now be a worry for BTL'ers that CGT is going to be raised in increments - perhaps to 35% next budget and then 40% the Budget after that (and raising CGT with no taper relief or indexation now has a precedent).

I don't think this Budget is as much 'good' news for BTL'ers as our first responses seem to indicate, nor as much 'bad' news for HPC'ers that were hoping CGT would be raised to 40% as first seems. I suspect that if George had gone for the full rise to 40%/50% then it would almost certainly have been with taper relief.

Is the 28% as much of a compromise as it first appears?

Am happy to be convinced otherwise. Also, remain to be convinced that this 28% will rise to 35% and then 40%, suspect it is rather an appeasement bone tossed to the Libs and we will see little in the form of further rises.

[tim123]

Indeed (taken from the budget blog on the beeb).

So £400 pw is ~ £1800 pm.

I assume he's mistaken this for per month.

No-one outside of London thinks in terms of weekly rental for a house. Weekly rents are for bedsits.

tim

[Harold Bishop]

I think previously 40% could be tapered down to 24%.

[/quote

It would be good to see some worked examples of the maths comparing the 2 scenarios (28% with no taper relief Vs 40% with taper relief) for BTL'ers who sell after 5, 10, 15 years.

I read somewhere (although this would need to be checked via more reliable sources as to whether this is correct or not - that under the old CGT regime (ie 40% with taper relief) that the average CGT bill for BTL'ers/2nd home owners was 18% ...... if true then the new flat rate of 28% with no taper relief is going to see a significant rise in CGT bills for BTL'ers compared to the old regime or indeed if George had raised CGT to 40% with taper relief in this Budget.

Also, it must now be a worry for BTL'ers that CGT is going to be raised in increments - perhaps to 35% next budget and then 40% the Budget after that (and raising CGT with no taper relief or indexation now has a precedent).

I don't think this Budget is as much 'good' news for BTL'ers as our first responses seem to indicate, nor as much 'bad' news for HPC'ers that were hoping CGT would be raised to 40% as first seems. I suspect that if George had gone for the full rise to 40%/50% then it would almost certainly have been with taper relief.

Is the 28% as much of a compromise as it first appears?

I may have been a bit off track. There is taper relief for second homes ( that are not businesses) but its less.

I think if taper relief is scrapped then all second home owners will be subject to the full amount of ( increasing) CGT. I think this is the Govs way of hitting property speculators.

Now, if they had started to ease in CGT on people's primary homes, that would have been good.

[stuckmojo]

Not sure about inflation rising - there appears to be a move to mapping things across to CPI - so would indicate that they would be wanting to keep that low... tough balancing act.

I disagree. That's the key point in my view.

Target inflation at 2%, fail it and have 4%, which means that you are actually cutting all the various areas which have been capped (LHA, child credits etc)

[huw]

Oh I think they do, but they prefer to play the inflation card.

Exactly what I thought when I heard him announce the minimum 2.5% uplift in state pensions.

[The Generation Game]

I assume he's mistaken this for per month.

No-one outside of London thinks in terms of weekly rental for a house. Weekly rents are for bedsits.

tim

And nor should they. There are better things in life to think about.

A bedsit at £250pw (~£1125pm) must be something special (I'm guessing that in central London it's a hole, and a 6' x 4' hole at that)

[Hip to be bear]

Hazel Blears unleashed on the unsuspecting BBC1 audience. She annoys me more than Harman. The thrust of Labour's attack is going to be: VAT is a regressive tax.

I seem to remember in the election campaign that none of the 3 parties would rule out a VAT increase.

[muggle]

Indeed (taken from the budget blog on the beeb).

So £400 pw is ~ £1800 pm.

Let's check rightmove:

http://www.rightmove.co.uk/property-to-rent/find.html?searchType=RENT&locationIdentifier=REGION^61318&insId=1&radius=0.0&displayPropertyType=&minBedrooms=4&maxBedrooms=4&minPrice=&maxPrice=&maxDaysSinceAdded=&retirement=&sortByPriceDescending=&_includeLetAgreed=on&primaryDisplayPropertyType=&secondaryDisplayPropertyType=&oldDisplayPropertyType=&oldPrimaryDisplayPropertyType=&letType=&letFurnishType=&houseFlatShare=false&x=49&y=18

Some people just do anything to get themselves worked up.

Meanwhile, this is what £400 PW will get you in London...

http://www.rightmove.co.uk/property-to-rent/find.html?locationIdentifier=REGION%5E87490&insId=1&maxPrice=1750&minBedrooms=4&maxBedrooms=4&secondaryDisplayPropertyType=detachedshouses

Hardly 'living on the streets'.

[guitarman001]

Were public sector pensions and job losses mentioned at all?

[pajd]

A Hamish McTavish view on the budget

This will calm people down, and increase confidence no end.

Recovery should continue apace now.

[juvenal]

Hazel Blears unleashed on the unsuspecting BBC1 audience. She annoys me more than Harman. The thrust of Labour's attack is going to be: VAT is a regressive tax.

I seem to remember in the election campaign that none of the 3 parties would rule out a VAT increase.

All three claimed they were 'not planning to increase VAT...'

Edited June 22, 2010 by juvenal

[The Generation Game]

Were public sector pensions and job losses mentioned at all?

I guess the 25% cut across all unprotected parts of the public sector probably covers the job losses.

[Snugglybear]

I assume he's mistaken this for per month.

No-one outside of London thinks in terms of weekly rental for a house. Weekly rents are for bedsits.

tim

It's per week. LHA / BRMA rents are expressed per week.

[Alfie Moon]

ame='Alfie Moon' date='22 June 2010 - 02:03 PM' timestamp='1277211820' post='2583880']

Am happy to be convinced otherwise. Also, remain to be convinced that this 28% will rise to 35% and then 40%, suspect it is rather an appeasement bone tossed to the Libs and we will see little in the form of further rises.

But can you gaurantee that there won't be further rises? No, of course not and that is the thought BTL'ers have to play around with. We all know that there will be further public spending cuts and further tax rises in future Budgets (unless people really believe that this Budget is going to solve the UK's economic problems, that the worst is over, and future Budgets will be about applauding us entering, or being in, the new age of prosperity by next April - are the Lib Dems really going to just sit back and accept the 28% level for CGT or will they keep putting pressure on George to keep raising it in steps Budget by Budget? Who knows? It would certainly be foolish to rule out further rises ..... and the expectation now must be that further rises will be no taper relief or indexation.

[MinceBalls]

No, it is inflation and it is tens of thousands of job cuts yet to be announced in the coming months in the public sector.

So great if you bought in the bubble as low IRs and inflation will be like the 70s - in 15 years you will be sitting pretty but people who have not bought yet will be priced further and further out of property.

The only 'hope' is public sector workers losing jobs and being desperate to sell.

Sorry, but that is how I read it.

In the 70's wages rose with inflation. The government have just announced a public sector pay freeze. So how are all these public sector workers going to get pay rises which would equate to the 1970's analagy you describe? I'm interested.

[Si1]

Were public sector pensions and job losses mentioned at all?

blimey - no - thoughts anyone?

[tim123]

ame='Alfie Moon' date='22 June 2010 - 02:03 PM' timestamp='1277211820' post='2583880']

I may have been a bit off track. There is taper relief for second homes ( that are not businesses) but its less.

I think if taper relief is scrapped then all second home owners will be subject to the full amount of ( increasing) CGT. I think this is the Govs way of hitting property speculators.

Now, if they had started to ease in CGT on people's primary homes, that would have been good.

Taper relief was abolished when the 18% rate came in.

The only relief that still exists is entrepreneurs relief.

tim