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Sledgehead

Csr / Pbr - Evan Davis : "party Over In Public Sector."

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It would seem that the Chancellor is so hamstrung by previous Brown promises that most of what will be said in a few moments in the House is old news. About the only thing up for debate is NHS spending.

But don't expect too much critical analysis by the Beeb. For them it's politics that matter. Who could really care about the tax burden growing from 36% to 38% during a downturn, when Darling looks set to make the embarassing move of parroting the Tory IHT threshold increase! Much more interesting ... for political hacks...

Edited by Sledgehead

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What the Dickens was that review of CGT he just garbled?

'Scrap taper relief and impose a flat tax of 18%' was what he seemed to say ... sounds like he's finally cottoned on to the fact that frequent trading:

1 ) makes for better price discovery;

2 ) raises more stamp duty;

... will be interesting to see the devil-details ...

... and does a flat rate mean no allowance???

Edited by Sledgehead

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Osbourne tore Darling apart on politics. Now Vince Cable is ticking all the boxes for those with the facts at their fingertips. He congratulated darling for being the first Chancellor to preside over a bank run in donkey's years, b4 asking what odds Darling put on a recession hitting GB, given Greenspan puts a US one @ 50%. He said this was important because growth has been based on household-debt secured against massively over-priced housing. He pointed out that the level of personal indebttedness was well in excess of that achieved in the US.

Kinda summed it all up nicely really ...

Edited by Sledgehead

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Returning to CGT, Jenny Scott is a little confused what he means, so I'm in good company ... Evan has had more time to look and believes it really is a flat 18% - down from 40% @ the top rate - that sounds like a MASSIVE move.

I wonder whether this may produce some crystallisation of profits while taper relief still exists?

Edited by Sledgehead

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I just started a new thread with the CGT stuff from the published treasury paper. (as a relative newbie the thread has to be moderated).

The big thing seems to be abolition of taper relief. Could mean lots of LLs putting property on the market? Although I expect we'll see some ruses such as selling to companies to crystallise gains or some such.

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As oon as I heard it, the CGT issue seemed highly significant to me, hence the comment.

What seems clear is a marked shift away from favouring business assets / disfavouring non-business assets, back to a level playing field.

Whilst the move is meant to hit private equity multi-millionaires, it is clear it will have a huge impact on ordinary investors.

Currently, taper relief on non-business assets, like stocks and shares, kicks in after year 3, reducing your (tax) chargeable gain by 5% a year. This carries on until year 10. At this point max reliefe is achieved, leaving high rate tax payers with a 24% effective tax bill. Low rate tax payers end up paying 12%.

However, most low rate tax payers will probably find the annual allowance enough to allow them capital gains tax free.

In otherwords, this tax move is basicaly negative for business asset owners (who previously could within a couple of years reduce their tax bill to 10%) but positive for high rate tax payers who now pay just 18% rather than a fully reliefed 24%.

It's also a trader's dream as it means there is no advantage in holding stocks for a period of time.

Edited by Sledgehead

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Osbourne tore Darling apart on politics. Now Vince Cable is ticking all the boxes for those with the facts at their fingertips. He congratulated darling for being the first Chancellor to preside over a bank run in donkey's years, b4 asking what odds Darling put on a recession hitting GB, given Greenspan puts a US one @ 50%. He said this was important because growth has been based on household-debt secured against massively over-priced housing. He pointed out that the level of personal indebttedness was well in excess of that achieved in the US.

Kinda summed it all up nicely really ...

The Tories need to hire Vince Cable. Probably the only politician who actually talks any sense whatsoever.

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The people that will suffer most from this spending review are vulnerable pensioners who need local authority care and home helps - the resources for adults social care are only going up by inflation yet our pensioner population is getting bigger and older.

Why isn't the Government doing more to help pensioners while they are alive rather than allowing the beneficiaries of their wills to pay less tax. What a mad and greedy society we have become - the British people really are that stupid!

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