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PeanutButter

We all want to live the good life – but how can we afford it?

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Britain could have great healthcare, fair welfare and environmentally friendly transport networks if excessive rents weren’t starving the economy

 

All of this might be affordable if we weren’t paying such high rents to the owners of Britain’s land and property.

The US, France and Germany have their property hotspots, yet most of the land remains cheap and rents in large cities can be still be affordable.

In the UK, we are all shelling out huge sums on rent and mortgages that could be used to pay tax on collective goods and services, or to buy those goods and services directly.

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1 hour ago, PeanutButter said:

In the UK, we are all shelling out huge sums on rent and mortgages that could be used to pay tax on collective goods and services, or to buy those goods and services directly.

The article also says:

“Sticking to the environmental theme, millions of homes need to be insulated and there need to be more of them, preferably offering subsidised rents, to accommodate millennials currently living with their parents and the extra 220,000 legal migrants who arrive each year and want somewhere to live.”

So the guardian could have said:

“we are all shelling out huge sums on rent and mortgages that could be used to pay tax on subsidising rents”

 

Edited by Arpeggio

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15 minutes ago, Ghostly said:

Why does The Guardian wish us to pay additional taxes? Makes no sense.

It does if it disincentivises property speculation.

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2 hours ago, Ghostly said:

Why does The Guardian wish us to pay additional taxes? Makes no sense.

I don't know. Scotland’s Daily Record gets better sales from a much smaller population.

As opposed to the Guardian, this place does allow comments.

https://off-guardian.org/

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12 hours ago, Ghostly said:

Why does The Guardian wish us to pay additional taxes? Makes no sense.

It makes perfect sense if you are The Guardian. It puts less pressure on them to end their own offshore tax avoidance scam:

https://blogs.spectator.co.uk/2016/04/will-the-guardian-now-investigate-its-own-tax-arrangements/

https://blogs.spectator.co.uk/2017/11/when-will-the-guardian-investigate-the-offshore-trusts-used-by-guardian-media-group/

It is interesting that if you Google for 'tax avoidance and The Guardian', neither of these come up, because the Guardian cops all the references with their own criticisms of other companies' tax avoidance. Clever eh?

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1 hour ago, onlooker said:

It is interesting that if you Google for 'tax avoidance and The Guardian', neither of these come up, because the Guardian cops all the references with their own criticisms of other companies' tax avoidance. Clever eh?

Might also be that EU “right to be forgotten” law for the internet.

https://www.itpro.co.uk/data-protection/22378/what-is-googles-right-to-be-forgotten

“a mechanism that allows data subjects to request that data about them be removed from an organisation's database regardless of the reasons.”

Edited by Arpeggio

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17 hours ago, PeanutButter said:

Britain could have great healthcare, fair welfare and environmentally friendly transport networks if excessive rents weren’t starving the economy

 

All of this might be affordable if we weren’t paying such high rents to the owners of Britain’s land and property.

The US, France and Germany have their property hotspots, yet most of the land remains cheap and rents in large cities can be still be affordable.

In the UK, we are all shelling out huge sums on rent and mortgages that could be used to pay tax on collective goods and services, or to buy those goods and services directly.

 

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"We all want to live the good life – but how can we afford it?"

If you really want it, vote for a party that does this

  • Stop overseas house purchases
  • Apply huge inheritence tax
  • apply capital gains tax on HPI to ALL houses.  

The problem of course is that the above will collapse the economy

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8 hours ago, rockerboy said:

If you really want it, vote for a party that does this

  • Stop overseas house purchases
  • Apply huge inheritence tax
  • apply capital gains tax on HPI to ALL houses.  

The problem of course is that the above will collapse the economy

Sorry but that's a terrible idea.  It means that if you want to buy a comparable house somewhere else you could lose out massively.

For example, let's say you buy a 200k house and then over the next 20 years it doubles to 400k just because of inflation (not excessive HPI).

Then when you sell it you're taxed 30% of whatever of the 200k difference, and now can't afford to buy a comparable house in another area to move for work etc.

That would just gum up the labour market as suddenly no one wants to move jobs if it means moving house.  It also makes it harder to upsize your house when you have kids etc.

It's just a bad idea.

Tax HPI on second or third homes etc as much as you like.

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I've long argued that HPI is overstated by capital expenditure on homes

Applying CGT to all homes would discourage VAT avoidance (cash to builders) significantly, as one assumes these payments would (should) be deductable

 

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12 hours ago, scottbeard said:

Sorry but that's a terrible idea.  It means that if you want to buy a comparable house somewhere else you could lose out massively.

For example, let's say you buy a 200k house and then over the next 20 years it doubles to 400k just because of inflation (not excessive HPI).

Then when you sell it you're taxed 30% of whatever of the 200k difference, and now can't afford to buy a comparable house in another area to move for work etc.

That would just gum up the labour market as suddenly no one wants to move jobs if it means moving house.  It also makes it harder to upsize your house when you have kids etc.

It's just a bad idea.

Tax HPI on second or third homes etc as much as you like.

I was pro the idea but you make a very good point so agree with you - totally agree with second/third homes etc 

 

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21 hours ago, rockerboy said:

 

I don’t know about France or Germany but you over simplify the US situation. My son lives in New York and I get on very well with my counterpart father in law who currently is in St Petersburg Fl, and we discuss all manner of stuff.

The majority of the US is sparsely populated think the Scottish highlands - cheap housing but no jobs and poor very poor communities 

If you want to have a career you have to generally be East/West coast - Miami, Tampa / Houston/Austin/ Chicago etc their are more but you get the drift 

Properties are expensive in desirable areas as you would expect but it’s the local property taxes that are penal - in St Petes a 4 bed home in a nice area ( think nice London Suburb) local property tax £22k a year and that’s low and St Petes is nice but it’s not Austin or New York 

Therefore people rent so they don’t have to take on the liability and have houses elsewhere perhaps as summer homes or retirement places 

However it also means that when people retire on fixed incomes they can’t afford to be near their families and have to move to cheaper places - bland places in Northern Florida or southern mid US like Albama or Nashville

Of course some move for the weather but it’s the minority most city people living in these places miss their city life style but couldn’t afford to stay in the area they had their lifetime roots in 

The local property tax is of course factored into rent but rather like our council tax it is a fixed term liability ie you stop paying rent it stops - like anywhere if you have a house but are in it or not it’s your liability 

He couldn’t believe how low our council tax rates are and it is not more closely linked to the properties value 

Factor this in with healthcare costs and you pay more effectively for a successful middle class lifestyle than in the U.K, there are millions of very successful six figure earners but that is just a function of scale and the size of the economy 

Middle America is hurting let alone semi skilled or manual workers 

He can’t believe that with universal healthcare and our low council tax that people think they would be better off in the US

 

edit: for some reason on phone didn’t paste in text it’s in reply to the US,Germany and France cheap property comment 

 

 

  

Edited by GregBowman

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10 minutes ago, GregBowman said:

Properties are expensive in desirable areas as you would expect but it’s the local property taxes that are penal - in St Petes a 4 bed home in a nice area ( think nice London Suburb) local property tax £22k a year and that’s low and St Petes is nice but it’s not Austin or New York 

 

AIUI property taxes in the USA pay for schools. Nothing comes from federal or state govt. Only the super rich send their kids to private school, because they don't need to. They move to a good quality neighbourhood, and the schools are excellent, afforded from the property taxes.

Other local services are funded out of property taxes as well, and many important jobs are awarded by local election. So local govt and services are very responsive to what local people want, and local democracy is very healthy, with high levels of participation.

Taxes on earnings are lower than the UK with many deductible expenses. I'm not sure, but I think there is no IHT, but the old often use up their savings to pay for their old age. Goods in the shops are generally cheaper than UK as well.

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1 hour ago, monkeyman1974 said:

I've long argued that HPI is overstated by capital expenditure on homes

Applying CGT to all homes would discourage VAT avoidance (cash to builders) significantly, as one assumes these payments would (should) be deductable

 

Only big jobs which are genuine additions are deductible againt CGT. An extension counts, but not a new bathroom or kitchen. I doubt it is easy to evade VAT on the big jobs.

Personally I think CGT is a pernicious tax. Most increases in value which are taxable are just due to inflation caused by the Govt printing money. The more they print, the more CGT they can levy.

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14 hours ago, scottbeard said:

Sorry but that's a terrible idea.  It means that if you want to buy a comparable house somewhere else you could lose out massively.

For example, let's say you buy a 200k house and then over the next 20 years it doubles to 400k just because of inflation (not excessive HPI).

Then when you sell it you're taxed 30% of whatever of the 200k difference, and now can't afford to buy a comparable house in another area to move for work etc.

That would just gum up the labour market as suddenly no one wants to move jobs if it means moving house.  It also makes it harder to upsize your house when you have kids etc.

It's just a bad idea.

Tax HPI on second or third homes etc as much as you like.

The OP said "but how can we afford it?"

if HPI is neglible (about inflation), then CGT is within allowance. If you combine that with stamp duty only applicable to very expensive houses (super rich) then you would see it would have the opposite effect.

Our mindsets are still ingrained with the idea that house ownership equals a license to print money and we want to keep any "profit"

To make things affordable, I would say house prices generally need to fall to a third of today's prices and for the capital?  -  to a tenth.

Only answering the OP question - As an existing home owner, I obviously don't want this. 

And one things for sure - it would not last. The collapse of debt would likely destroy money/savings/pensions and I believe, send the UK into a severe period of deflation. Because of the poverty and lack of civil control, it's likely the UK would end up as some sort of North Korea of Europe.

I think most people would rather continue to spend 60% of their income on rent.......

Edited by rockerboy

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On 10/26/2019 at 7:10 PM, Arpeggio said:

preferably offering subsidised rents, to accommodate millennials currently living with their parents and the extra 220,000 legal migrants who arrive each year and want somewhere to live.”

Yea I will work to pay tax to give subsided housing to immigrants who have not paid a penny in tax here - great idea - where do I sign !  Who gives me subsided housing then? 

On 10/26/2019 at 9:17 PM, Ghostly said:

Why does The Guardian wish us to pay additional taxes? Makes no sense.

Because the left wing supports people who get off their backside to work paying tax to look after those who cannot be bothered and for people who come to the uk who have no work skills. 

22 hours ago, rockerboy said:

If you really want it, vote for a party that does this

  • Stop overseas house purchases
  • Apply huge inheritence tax
  • apply capital gains tax on HPI to ALL houses.  

The problem of course is that the above will collapse the econom

Vote for a party that

Stop overseas house purchases

Stops the insane level if immigration 

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Money paid in rent doesn't disappear, it is transferred to another group.  Renters may not be spending or enjoying the fruits of their labours but the owners of land and property are doing this in their stead . Hence buoyant cruise industry and resilience of the top end of the consumer market.

Edited by Wayward
Auto correct incorrect

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15 minutes ago, mallish said:

Yea I will work to pay tax to give subsided housing to immigrants who have not paid a penny in tax here - great idea - where do I sign !  Who gives me subsided housing then? 

Because the left wing supports people who get off their backside to work paying tax to look after those who cannot be bothered and for people who come to the uk who have no work skills. 

Vote for a party that

Stop overseas house purchases

Stops the insane level if immigration 

Just to get this into perspective how much tax do you actually pay?

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23 hours ago, rockerboy said:

"We all want to live the good life – but how can we afford it?"

If you really want it, vote for a party that does this

  • Stop overseas house purchases
  • Apply huge inheritence tax
  • apply capital gains tax on HPI to ALL houses.  

The problem of course is that the above will collapse the economy

Commie. 

Go live in Venezuela if you love the State so much.

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1 hour ago, onlooker said:

Most increases in value which are taxable are just due to inflation caused by the Govt printing money. The more they print, the more CGT they can levy.

Of course. This is the con and it's totally transparent.

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28 minutes ago, Locke said:

Commie. 

Go live in Venezuela if you love the State so much.

The Venezuelan economy is mostly in private hands. A significant exception being the oil industry but that was nationalised in the early 60s around the time that OPEC was established. In reality, Venezuelan oil is a crony capitalist enterprise run by the close friends and known associates of Chavez and Maduro.

The average tax rate in Venezuela is 25%. The average tax rate in the US is 26%.

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  • 297 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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