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Boris Johnson Tells George Osborne To Cut National Insurance And 50P Tax

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http://www.telegraph.co.uk/news/politics/8664414/Boris-Johnson-tells-George-Osborne-to-cut-National-Insurance-and-50p-tax.html

The Mayor of London said a cut in taxes, including the scrapping of the 50p higher income tax rate, was essential to encourage entrepreneurs and “send a signal” that Britain was “open for business”.

His demand came amid growing pressure on George Osborne to develop new policies to boost economic growth. The Daily Telegraph disclosed that there was impatience among No 10 advisers, who wanted the Treasury to be more imaginative in kick-starting the economy. The Chancellor said yesterday that there was underlying growth in the economy and that the Treasury’s tactics had “provided stability in a very unstable world”.

Once more the rich look after themselves. If you where serious about cutting tax and trying to get the economy moving again the last place you cut the tax is at the top for them to hoard even more. You have to cut at the bottom, double the amount before you start paying tax. That won't happen as that might benefit the proles and show everyone they are more important to the economy than the rich.

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If you where serious about cutting tax and trying to get the economy moving again the last place you cut the tax is at the top for them to hoard even more.

The Laffer curve, so favoured on this site (and rightly so) says otherwise.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

Why 'rightly so'? Is there any evidence that the Laffer curve is correct in this range?

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For once I think Boris has it right. But I'd also like to see the mega-rich actually pay their taxes, instead of hiding behind non-dom status or various evasion schemes. Bring down the top rate of tax, but make sure the rich do pay it - otherwise bring in that Cable wealth tax.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

I would have thought that everyone has their own personal Laffer curve and that currently, the elites are on the correct side of it and keeping plenty of their pay anyway. However, the proles are on the wrong side and this is where the tax cuts need to fall. Besides, it is the proles that contribute most of the tax anyway and a cut at that level would have a much greater effect than a similar cut at the higher rate.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

So that's why record numbers are on food stamps in the US then? Also explains why US corporations exported huge numbers of jobs over seas, at the expense of the proles. It also explains the explosion in health care costs / university costs in the US...

I was under the impression the laffer curve was to stimulate jobs rather than food stamps and unemployment lines. Maybe it would but the cuts have to be inclusive rather than just for the elites.

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The Tories really screwed up badly to come in to power and immediately aggressively raise taxes. You can't raise taxes as a way to get out of a recession.

You have to follow the Reagan and Thatcher model of supply side economics and de-regulation. Then have faith that the economic growth will take care of things.

Of course interestrateripoff's plan for first cutting taxes on average people is the best idea.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

Null & void

- cos the rich dodge all their taxes/pay minimal by off-shoring their companies and holding their property/wealth in off-shore trusts.

One of the 'never discussed' BIG reasons the whole country is breaking down & Govt keep whacking the middle/poor classes with stealth taxes and tax increases!

A serial non-taxpayer, Sir Philip Green was born into a Jewish family . . . . a clever man but how clever (with the help of his colluding 'business' buddies - the Barclay Brothers!)

"The big question for British Jews when the Telegraph changed hands in 2004 was whether the new owners, the Barclay brothers, would be as friendly towards Israel and the Zionist cause as Lord Black."

(looking thru his career actually makes him look like a serial asset stripper - in conjunction with a load of unknowns buying and selling UK chains to each other.)

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

What does the Laffer curve have to say about people in the £0-15k range who face extremely high (sometimes over 100%) marginal tax rates when you account for the loss of tax credits as you move up the income scale?

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No surprise that is was the Bankers' Buddy Boris that said this. He's got previous form on asking for leniency in areas which affect the City most.

It's a shame because he otherwise seems to do an OK job as Mayor of London. (I don't live in London though so I could easily be wrong here.)

Or maybe he's looking ahead for people to fund a run for leadership of the Tories? <_<

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No surprise that is was the Bankers' Buddy Boris that said this. He's got previous form on asking for leniency in areas which affect the City most.

It's a shame because he otherwise seems to do an OK job as Mayor of London. (I don't live in London though so I could easily be wrong here.)

Or maybe he's looking ahead for people to fund a run for leadership of the Tories? <_<

If he keeps this up he will be the ex-Mayor of London. Its a shame that the only other contender is Ken Livingstone :blink:

The London Banksters obviously still have direct access to City Hall.

As said earlier in the thread, the quickest way to pump money into the wider economy would be to raise tax thresholds, especially at the bottom, even in London. Giving the banksters more or "their (ahem) " money will only end up in prime property. Perhaps Boris is worried about a decline in house prices at the top end

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As said earlier in the thread, the quickest way to pump money into the wider economy would be to raise tax thresholds, especially at the bottom, even in London.

Yes tax thresholds should be raised, and standard rate VAT reduced to 15% or even better 10%.

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http://www.telegraph.co.uk/news/politics/8664414/Boris-Johnson-tells-George-Osborne-to-cut-National-Insurance-and-50p-tax.html

Once more the rich look after themselves. If you where serious about cutting tax and trying to get the economy moving again the last place you cut the tax is at the top for them to hoard even more. You have to cut at the bottom, double the amount before you start paying tax. That won't happen as that might benefit the proles and show everyone they are more important to the economy than the rich.

And you think that there's any meaningful difference between the Condems and New Labour??????????????????????????

Are you awake?

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

All the Laffer curve says is that if people were taxed at 100% they wouldn't work as it would be pointless.

Therefore at some point between 0 and 100% must be the optimal taxation point for an economy.

What it definitely doesn't say is that cutting taxes always leads to additional tax revenues as it is misused to represent now.

It also relies on the fact we can choose how much we work - I'm sure the City boys on £500k a year work long hours, cutting their rate of taxation won't suddenly increase the amount of hours available to them to work in.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

Yes, so you think that the Laffer curve was based on firm empirical analysis

er, it wasn't

Rather famously this 'analysis' was based on a sketch made by Art Laffer on the back of napkin at a restaurant

Tax revenues fall when tax rates fall: fact!

Over the last thirty years tax rates have fallen and budget deficits have gor wider because tax receipts failed to produce the Laffer curve effect

File under 'trickle-down' economics and other fig leaves for stealing from the poor to give to the rich

Before posting on matters Economic you need to have some understanding of, er, Economics

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If you where serious about cutting tax and trying to get the economy moving again the last place you cut the tax is at the top for them to hoard even more. You have to cut at the bottom, double the amount before you start paying tax. That won't happen as that might benefit the proles and show everyone they are more important to the economy than the rich.

Appears you know nowt about how taxes work!

Edited by Chest Rockwell

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

revenues from the Rich may well decline, but imagine cutting tax for the poor...more free spending, more pickings for more business entreprenuers to feast on.

and there are 90 times as many poor as there are Rich.

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The Laffer curve, so favoured on this site (and rightly so) says otherwise.

Most people here tend to laugh at economics's claim to be a "real science" (and rightly so). But the Laffer Curve seems to be held in strangely awestruck regard.

Why is this? The Laffer Curve isn't even a curve, by its own definition! It's merely a graph with two points on! All it says is:

  1. If you tax someone at 0%, you will get 0 tax income

  2. If you tax someone at 100%, you will get 0 tax income

It says absolutely nothing else about tax rates between 1% and 99%! Any other data derived from the Laffer "Curve" is absolute conjecture borne entirely of insultingly superficial theoretical assumption! It's less credible than a ratings agency!

Imagine two countries, both with 50 million people. One country has a single tax inspector called Arthur, and the penalty for an incorrect tax return is 10 hours community service. The other country has 80,000 tax inspectors and the penalty for wrongdoing is execution. Will the Laffer "Curve" look the same in these two countries? I don't think so. How many possible Laffer "Curves" are there, then? What's the formula to plot the Laffer "Curve" for a given country? What variables do you need to know?

Oh, that's right, there is no formula! There is no curve! Who knows what happens? Not the Laffer Curve! I mean, not the Laffer Points!

And even one of the two axioms is questionable. If you tax someone at 100%, you will get 0 tax income. Really? How about forced labour? How about charity workers? How about "the war effort"?

The Laffer "Curve" is, in reality, either:

  1. A simple conceptual device to show week 1 GCSE Economics students that policies can have feedback effects, or

  2. Something that looks and sounds "scientific", so is used to justify a particular political ideology, despite having no empirical or rational basis

Absolute load of crap. "Laffer Curve?"

ricky_gervais150.jpg

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Appears you know nowt about how taxes work!

The idea is to get those paying $0 into the tax system, not for them to continue paying zero. The aim is growth isn't it?

Plus this is misleading as it ignores marginal tax rates and focuses on values.

It's far more complex than this simple little story, although that doesn't make effective propaganda.

Myhttp://www.reuters.com/article/2008/08/12/us-usa-taxes-corporations-idUSN1249465620080812

Most U.S. and foreign corporations doing business in the United States avoid paying any federal income taxes, despite trillions of dollars worth of sales, a government study released on Tuesday said.

The Government Accountability Office said 72 percent of all foreign corporations and about 57 percent of U.S. companies doing business in the United States paid no federal income taxes for at least one year between 1998 and 2005.

More than half of foreign companies and about 42 percent of U.S. companies paid no U.S. income taxes for two or more years in that period, the report said.

So put into context here we have the biggest companies paying zero for their drinks at the bar???

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Imagine two countries, both with 50 million people. One country has a single tax inspector called Arthur, and the penalty for an incorrect tax return is 10 hours community service. The other country has 80,000 tax inspectors and the penalty for wrongdoing is execution. Will the Laffer "Curve" look the same in these two countries? I don't think so. How many possible Laffer "Curves" are there, then? What's the formula to plot the Laffer "Curve" for a given country? What variables do you need to know?

Imagine what happens if one of those countries is Greece...

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Most people here tend to laugh at economics's claim to be a "real science" (and rightly so). But the Laffer Curve seems to be held in strangely awestruck regard.

Why is this? The Laffer Curve isn't even a curve, by its own definition! It's merely a graph with two points on! All it says is:

  1. If you tax someone at 0%, you will get 0 tax income

  2. If you tax someone at 100%, you will get 0 tax income

It says absolutely nothing else about tax rates between 1% and 99%! Any other data derived from the Laffer "Curve" is absolute conjecture borne entirely of insultingly superficial theoretical assumption! It's less credible than a ratings agency!

Yes, but it serves the interests of the rich, so it doesn't need supporting evidence..

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What does the Laffer curve have to say about people in the £0-15k range who face extremely high (sometimes over 100%) marginal tax rates when you account for the loss of tax credits as you move up the income scale?

To be accurate, you'd have to view the effect of the laffer curve on the person who's actually funding that other persons tax credit.

Tax credits are just another form of welfare, if they're facing 100% marginal rates then their net contribution against services used would almost certainly be negative.

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Yes, so you think that the Laffer curve was based on firm empirical analysis

er, it wasn't

Rather famously this 'analysis' was based on a sketch made by Art Laffer on the back of napkin at a restaurant

Tax revenues fall when tax rates fall: fact!

Over the last thirty years tax rates have fallen and budget deficits have gor wider because tax receipts failed to produce the Laffer curve effect

File under 'trickle-down' economics and other fig leaves for stealing from the poor to give to the rich

Before posting on matters Economic you need to have some understanding of, er, Economics

I'm sure you'll be able to back up this "fact" otherwise I'm going to have to call bullsh¡t.

why lower taxes raise more money

"There is a distinct pattern throughout American history: When tax rates are reduced, the economy's growth rate improves and living standards increase. Good tax policy has a number of interesting side effects. For instance, history tells us that tax revenues grow and "rich" taxpayers pay more tax when marginal tax rates are slashed. This means lower income citizens bear a lower share of the tax burden - a consequence that should lead class-warfare politicians to support lower tax rates.

Conversely, periods of higher tax rates are associated with sub par economic performance and stagnant tax revenues. In other words, when politicians attempt to "soak the rich," the rest of us take a bath. Examining the three major United States episodes of tax rate reductions can prove useful lessons.

1) Lower tax rates do not mean less tax revenue.

The tax cuts of the 1920s

Tax rates were slashed dramatically during the 1920s, dropping from over 70 percent to less than 25 percent. What happened? Personal income tax revenues increased substantially during the 1920s, despite the reduction in rates. Revenues rose from $719 million in 1921 to $1164 million in 1928, an increase of more than 61 percent.

According to then-Treasury Secretary Andrew Mellon:

The history of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.

The Kennedy tax cuts

President Hoover dramatically increased tax rates in the 1930s and President Roosevelt compounded the damage by pushing marginal tax rates to more than 90 percent. Recognizing that high tax rates were hindering the economy, President Kennedy proposed across-the-board tax rate reductions that reduced the top tax rate from more than 90 percent down to 70 percent. What happened? Tax revenues climbed from $94 billion in 1961 to $153 billion in 1968, an increase of 62 percent (33 percent after adjusting for inflation).

According to President John F. Kennedy:

Our true choice is not between tax reduction, on the one hand, and the avoidance of large Federal deficits on the other. It is increasingly clear that no matter what party is in power, so long as our national security needs keep rising, an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.

The Reagan tax cuts

Thanks to "bracket creep," the inflation of the 1970s pushed millions of taxpayers into higher tax brackets even though their inflation-adjusted incomes were not rising. To help offset this tax increase and also to improve incentives to work, save, and invest, President Reagan proposed sweeping tax rate reductions during the 1980s. What happened? Total tax revenues climbed by 99.4 percent during the 1980s, and the results are even more impressive when looking at what happened to personal income tax revenues. Once the economy received an unambiguous tax cut in January 1983, income tax revenues climbed dramatically, increasing by more than 54 percent by 1989 (28 percent after adjusting for inflation).

According to then-U.S. Representative Jack Kemp (R-NY), one of the chief architects of the Reagan tax cuts:

At some point, additional taxes so discourage the activity being taxed, such as working or investing, that they yield less revenue rather than more. There are, after all, two rates that yield the same amount of revenue: high tax rates on low production, or low rates on high production.

2) The rich pay more when incentives to hide income are reduced.

The tax cuts of the 1920s

The share of the tax burden paid by the rich rose dramatically as tax rates were reduced. The share of the tax burden borne by the rich (those making $50,000 and up in those days) climbed from 44.2 percent in 1921 to 78.4 percent in 1928.

The Kennedy tax cuts

Just as happened in the 1920s, the share of the income tax burden borne by the rich increased following the tax cuts. Tax collections from those making over $50,000 per year climbed by 57 percent between 1963 and 1966, while tax collections from those earning below $50,000 rose 11 percent. As a result, the rich saw their portion of the income tax burden climb from 11.6 percent to 15.1 percent.

The Reagan tax cuts

The share of income taxes paid by the top 10 percent of earners jumped significantly, climbing from 48.0 percent in 1981 to 57.2 percent in 1988. The top 1 percent saw their share of the income tax bill climb even more dramatically, from 17.6 percent in 1981 to 27.5 percent in 1988.

Harmful Spending & Complexity

Lower tax rates are important, but they are not the only critical issue. Both the level of government spending and where that money goes are very important. And even when looking only at tax policy, tax rates are just one piece of the puzzle. If certain types of income are subject to multiple layers of tax, as occurs in the current system, that problem cannot be solved by low rates. Similarly, a tax system with needless levels of complexity will impose heavy costs on the productive sector of the economy."

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  • 276 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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