The forthcoming Autumn Budget

[Jon39]

Over and over again, we are told, "There will not be any increase to Income Tax, National Insurance or Value Added Tax."

After the election, the government said, "We didn't realise just how bad the UK finances were".
Rather strange, because the government borrowing has reached an unprecedented enormous level.
Annual interest payments on that borrowing, now exceed the amount spent on the defence of the UK population.
None of that is secret, but perhaps Sir Starmer does not like reading financial news, which might explain why he did not realise.

With a plan to spend, of course either borrowing or taxes, must increase. Growth per capita is a dream at present.

The manifesto promise (are there such things?) of no increases, can still easily be honoured though.
Don't increases IC; NI; VAT, but introduce a brand new tax.
It could be called the Conservative Black Hole Tax (CBHT).
Income tax is by far the biggest individual revenue earner for the Treasury, so CBHT would also raise a considerable amount, which might transform the lives of those who choose to remain in the UK ('brain drain').

So on our pay slips we would see a deduction for IC and NI, then a new CBHT deduction, perhaps only 10% to start with. It can then easily be increased subsequently.

Opinion polls do establish that people are willing to pay more tax, expecting to achieve better public services. Unfortunately when they are in a private polling booth, their previous intentions are usually forgotten.

So there we are. You heard it here first. No existing tax increases, but a new CBHT deduction for us all.
What a clever way to keep to an election pledge.
There are previous examples of new taxes, that both increased and became permanent.

[Salted_Peanut]

I expect October’s budget will hit pensions “for those with the broadest shoulders”. However, I hope it won’t worsen the gulf between private- and public-sector pensions.

[sugerbear]

Jon39 said:

Over and over again, we are told, "There will not be any increase to Income Tax, National Insurance or Value Added Tax."

After the election, the government said, "We didn't realise just how bad the UK finances were".
Rather strange, because the government borrowing has reached an unprecedented enormous level.
Annual interest payments on that borrowing, now exceed the amount spent on the defence of the UK population.
None of that is secret, but perhaps Sir Starmer does not like reading financial news, which might explain why he did not realise.

With a plan to spend, of course either borrowing or taxes, must increase. Growth per capita is a dream at present.

The manifesto promise (are there such things?) of no increases, can still easily be honoured though.
Don't increases IC; NI; VAT, but introduce a brand new tax.
It could be called the Conservative Black Hole Tax (CBHT).
Income tax is by far the biggest individual revenue earner for the Treasury, so CBHT would also raise a considerable amount, which might transform the lives of those who choose to remain in the UK ('brain drain').

So on our pay slips we would see a deduction for IC and NI, then a new CBHT deduction, perhaps only 10% to start with. It can then easily be increased subsequently.

Opinion polls do establish that people are willing to pay more tax, expecting to achieve better public services. Unfortunately when they are in a private polling booth, their previous intentions are usually forgotten.

So there we are. You heard it here first. No existing tax increases, but a new CBHT deduction for us all.
What a clever way to keep to an election pledge.
There are previous examples of new taxes, that both increased and became permanent.

How much are you prepared to wager on this flight of fantasy?

[Murph7355]

Jon39 said:

... .
Opinion polls do establish that people are willing to pay more tax, expecting to achieve better public services. Unfortunately when they are in a private polling booth, their previous intentions are usually forgotten.
....

Everybody wants someone else to pay more tax so that they can get the services they think they deserve/are owed.

That seemingly never changes. And until it does, we are fq'd.

We will see what sort of grab they do on pensions. IHT likely too.

It's been insane of both parties making moronic pledges on which taxes they will and won't touch. They should all be open for change, as should spending.

[OutInTheShed]

Murph7355 said:

Everybody wants someone else to pay more tax so that they can get the services they think they deserve/are owed.

That seemingly never changes. And until it does, we are fq'd.

We will see what sort of grab they do on pensions. IHT likely too.

It's been insane of both parties making moronic pledges on which taxes they will and won't touch. They should all be open for change, as should spending.

I don't want anyone to pay any more tax.
I want to see big cuts in pen pushers.
I don't see that happening though.

There are more than two parties!

My guess of what they might do includes:
Stop all the benefits of salary sacrifice.
Full VAT on energy, possibly only for anyone spending more than average
Changes to ISAs
Some sort of attack on trusts
A re-write of IR35 which makes the old one look like a safe warm place.
Punitive taxes on new IC cars.
Maybe some charities given similar treatment to private schools?
Big reduction in VAT threshold?

[Ian Geary]

Jon39 said:

.
None of that is secret, but perhaps Sir Starmer does not like reading financial news, which might explain why he did not realise.

(Cut from opening post)

Far more likely that the electorate does not like reading the financial news, which might explain why they (you?) did not realise.

Our voting system simply does not reward candid or truthful candidates. When the main parties are lying about the financial status of the country, it would be impossible for a party to get elected by telling it how it is.

Yes there are more than 2 parties, but the newcomer Reform were caught out telling outrageous lies about their spending plans (imaginary doodlings would be a better term).


I think Labour did what they had to, and honestly although I did not vote for them, I feel more optimistic that they will try and address root causes than I did under the last 14 years, which just proved slash and burn policies yield poor outcomes.

[Chrisgr31]

With any luck we'll have reform of council tax and a reform of it as well. Could bring in a lot of money. I suspect they'll also announce changes to business rates.

[markymarkthree]

Chrisgr31 said:

With any luck we'll have reform of council tax and a reform of it as well. Could bring in a lot of money. I suspect they'll also announce changes to business rates.

Doubtful, far to much work involved there and it would take forever.
They will either remove or increase the cap to say 10% or 15%.

[Cobracc]

Chrisgr31 said:

With any luck we'll have reform of council tax and a reform of it as well. Could bring in a lot of money. I suspect they'll also announce changes to business rates.

Council tax definitely needs re-evaluating, a lot has changed since 1992.

[Ecosseven]

I think they will go after the easy wins that will hit higher rate tax payers. The majority of voters aren't higher rate tax payers.

In my humble opinion............

- Increase in CGT looks highly likely
- Reduction in the pension annual allowance from £60k to £40k is highly likely.
- Reduction in pension tax relief for higher rate taxpayers - hmmmm, not sure. This will impact a lot of the public sector employees and could result in the abolition of salary sacrifice schemes.
- Increase in dividend tax for higher rate taxpayers is highly likely.
- Subject pensions to IHT - possible.
- Limit the value of the pension tax free lump sum - possible.
- Increase in fuel duty - highly likely.
- Increase in VED - nailed on!

[markbigears]

Amazing that he has now found a £22bn black hole.
Is this even possible? Or just a lie?

[Jon39]

The problem facing any government when more tax is required, involves which taxes already raise a significant proportion of the total.
By increasing the rates for those, a greater amount of money can be raised.

The more minor taxes can be increased, but they obviously have less effect on the total revenue raised by the Treasury.






Tobacco duties have continuously been raised, but that has led to a huge increase in black market activity, on which the Treasury receives nothing.

The incentives effect can result in a variation in the amount of tax collected. CGT for example, has been increased on occasions, only to find that less revenue is being collected. People postpone or stop carrying out taxable transactions, when they feel the tax is unreasonable.
Another example of a disincentive, has been the windfall tax on North Sea oil activities applied by the Conservative government. Drilling projects have been stopped and a few big companies have abandoned their North Sea operations completely, because they consider it to be unviable for them to continue. Job losses are happening and union leader displeasure has been expressed. Future new investments are being moved away from the UK. Instead of the windfall tax raising additional revenue from those companies leaving, no tax at all is received. The shortfall of oil and gas required by the UK, has to be imported by ship from distant countries instead. Not very 'net-zero'.

Edited by Jon39 on Tuesday 27th August 21:32

[Gecko1978]

Vape tax now so many move onto them make them 80% the cost of cigarettes.

Tax off off licence alcohol (supermarkets etc) so a pint of beer is similar to that in a pub

Luxury car tax last forever, duty on public EV charge points, more ULEZ charging

Corp tax up a % or two

CGT and dividend tax rises

Second home tax rises (would kill me but hey ho)

More tax on lottery tickets and large wins

Tax on gambling

Tax on hedge fund activities

More Tolls on roads (no improvements just a fee to use the M1)

Higher VAT on all sub 20% products

So many things they could do frankly. It's more a question of what people will accept

[SunsetZed]

Ecosseven said:

I think they will go after the easy wins that will hit higher rate tax payers. The majority of voters aren't higher rate tax payers.

In my humble opinion............

- Increase in CGT looks highly likely
- Reduction in the pension annual allowance from £60k to £40k is highly likely.
- Reduction in pension tax relief for higher rate taxpayers - hmmmm, not sure. This will impact a lot of the public sector employees and could result in the abolition of salary sacrifice schemes.
- Increase in dividend tax for higher rate taxpayers is highly likely.
- Subject pensions to IHT - possible.
- Limit the value of the pension tax free lump sum - possible.
- Increase in fuel duty - highly likely.
- Increase in VED - nailed on!

I think that this is pretty well my view as well.

I agree that a reduction in pension tax relief not only affects public sector employees but would be tricky to implement. I think it's more likely that they'll scrap salary sacrifice so that the employer NI contributions aren't skipped at this point

[Crafty_]

Think we'll see at least some of:

Fuel duty freeze ended + 3-5p increase, could result in 10p a litre increase.
10% on vehicle tax rounded up to the nearest £10, £0 band scrapped. the 1st year high rate will continue into 2nd/3rd year for cars over 40k
If they are being brazen 45% income tax rate will be back, if not that'll be next year.
Inheritance Tax allowance for primary residence scrapped, apparently the business relief is already earmarked as going.
Employers NI rates up, Employee NI cut reversed
Council tax changed to allow 10% increases, they might look at encouraging removal or reduction of single occupancy discounts
Tax on staff car parking, reduced if the company fit EV chargers
Air passenger duty increase
Pensions will get robbed in some way
They might also look at employee benefits - car/private healthcare etc in terms of changing income tax rules.
If they mess with energy taxation gas will get hit harder than electricity.
Possibly attach tax to vapes

[macron]

Ecosseven said:

- Reduction in the pension annual allowance from £60k to £40k is highly likely.

No, as it means lots of doctors leaving the NHS. And they can't replace them.

Gecko1978 said:

Luxury car tax last forever,

Second home tax rises (would kill me but hey ho)

Those are far more likely. No sympathy for people who can afford a car with a list price above the average wage, or anyone who can afford two homes.

This is envy, don't forget.

[Puzzles]

Ecosseven said:

I think they will go after the easy wins that will hit higher rate tax payers. The majority of voters aren't higher rate tax payers.

In my humble opinion............
- Reduction in the pension annual allowance from £60k to £40k is highly likely.
- Increase in dividend tax for higher rate taxpayers is highly likely.

Didn’t the tories increase from 40 to 60 to keep doctors working?

And

It’s already 33.75% for higher rate taxpayers and 39.35% for additional rate taxpayer.

After 25% corporation tax there'd be bugger all left.

[Wills2]

I hope the medicine doesn't kill the patient.

[Jockman]

Many higher rate payers don’t even claim higher tax relief so a 30% level may not be too disruptive.

Any interference on tax free lump sums will see a run on pensions which will see large outflows.

[NuckyThompson]

Puzzles said:

Didn’t the tories increase from 40 to 60 to keep doctors working?

And

It’s already 33.75% for higher rate taxpayers and 39.35% for additional rate taxpayer.

After 25% corporation tax there'd be bugger all left.

Don’t forget self employed who earn higher rate, they may just say sod this for a game of soldiers and downsize, drop staff and go below the threshold because what’s the point of working any harder if the government is going to get more than you do