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Is Uk Gdp Set To Tumble?

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I've noticed a trend - that of suppliers and traders increasingly testing the waters about paying in cash. I win by not paying the VAT. They win by keeping the books lower and paying less NI and Corp tax etc. We all lose because it depresses the tax take.

Got me thinking that if every household did this with just £1,000 then that would be £25bn taken out the system. Roughly 2.5% of GDP.

Mad thinking?

bos

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I've noticed a trend - that of suppliers and traders increasingly testing the waters about paying in cash. I win by not paying the VAT. They win by keeping the books lower and paying less NI and Corp tax etc. We all lose because it depresses the tax take.

Got me thinking that if every household did this with just £1,000 then that would be £25bn taken out the system. Roughly 2.5% of GDP.

Mad thinking?

bos

There are costs in not playing by the rules, but there is a cost benefit trade off. Put up taxes too much, and people will change the decision they make regarding whether they should abide by the law or otherwise.

It is for this reason that the Tories are playing a very dangerous game when raising any tax at the moment, it can be counterproductive, leading to a fall in tax revenues. Partly because people trade illegally, in cash, keeping stuff off of the books. And partly because people just give up and go on benefits, which after all, pay very well for many people, especially if you can get a council house.

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I've noticed a trend - that of suppliers and traders increasingly testing the waters about paying in cash. I win by not paying the VAT. They win by keeping the books lower and paying less NI and Corp tax etc. We all lose because it depresses the tax take.

Got me thinking that if every household did this with just £1,000 then that would be £25bn taken out the system. Roughly 2.5% of GDP.

Mad thinking?

bos

Yes, totally mad. If the money is not on the books then it doesn't need to be used to pay off debts as bankruptcy is available even when you have plenty of money. So the money remains in the system. In fact, without the taxation, the velocity of the money increases and so, GDP.

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Yes, totally mad. If the money is not on the books then it doesn't need to be used to pay off debts as bankruptcy is available even when you have plenty of money. So the money remains in the system. In fact, without the taxation, the velocity of the money increases and so, GDP.

How does moneybthat is never in the system contribute tona systemic measure?

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The gangsters I worked for in a meat place always used to do this, the whole supply chain would actually play ball too. The guy in Holland if you ordered a big enough load of meat (I'm talking a lorry full) he would send a company lorry around and you'd hand over about 100K in cash. Unload and the meat was sold off the books to resturants and take out places. The restuarants and take out places would then sell it off the books to their customers who also did jobs which were off the books too.

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And partly because people just give up and go on benefits, which after all, pay very well for many people, especially if you can get a council house.

...this is what happened under NuLabour ...and the government in turn encouraged immigration to fill the jobs vacated by people 'retiring' to benefits.... the Coalition Government's streamlining on October 20th will be aimed at putting an end to that.... :rolleyes:

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The gangsters I worked for in a meat place always used to do this, the whole supply chain would actually play ball too. The guy in Holland if you ordered a big enough load of meat (I'm talking a lorry full) he would send a company lorry around and you'd hand over about 100K in cash. Unload and the meat was sold off the books to resturants and take out places. The restuarants and take out places would then sell it off the books to their customers who also did jobs which were off the books too.

The black economy. It employs at least 3m directly and indirectly imo. The problem is many businesses in the black economy would go bust instantly were the tax man to insist they played by all the rules. I'm certain they turn a blind eye for this reason

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  • 239 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%



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