Darling to tax rich in pre-election gamble

[gingerpaul]

It looks like Labour are going all in with their final hand with their tax the rich strategy.

http://uk.reuters.com/article/idUKGEE5B22D32009120...

• Darling will have to admit the economy will shrink by 4.75 percent in 2009, much deeper than he forecast in April.

• He will stick to his forecast of GDP rising by 1 to 1.5 percent in 2010

• There will be a balance of tax rises for the better off and giveaways for the most vulnerable as Labour tries to draw a clear dividing line between it and the Conservatives. "You want to see the people who benefited most from the boom to pay something back."

• Some analysts speculate the government might choose to slap a windfall tax on the banks, which are enjoying a return to bumper profits. Such a move would be highly symbolic given Labour kicked off its rule in 1997 with a highly popular tax raid on privatised utility companies

• Labour already announced a new 50 percent tax rate in April and accountants Ernst and Young have calculated a 60 percent rate on those earning more than half a million pounds could raise 2 billion pounds.

And here is what concerns me the most about our situation.

• Darling will try to reassure financial markets jittery about Britain's creditworthiness.

I hear a death knell. I just hope it is for Labour and not UK plc.

[AndrewW-G]

Sounds more like scorched earth policy. The people / organistations who leave will be vilified in the press by labour, whilst those who stay will be taxed into oblivion.

The spin machine is already starting up on this, lots of negative reporting over bonus amounts, as soon as a decent size bank moves out of the UK or a senior finance figure goes non dom like Blair is, then the full might of the ministry of truth will be used to turn them into a real life Emmanuelle Goldstein.........................anybody for some victory gin before the two minute hate?

[thinfourth2]

Yes but what your average labour voting doesn't realize is that anyone who actually works 5 days a week is considered to be rich

[Don]

The problem with these high rates of tax for high earners is that they never, ever actually raise any money.

People who earn more than half a mil can probably influence how they earn it and where they earn it to an extent that they can legally avoid paying tax on it.

To really raise a ton of cash any government has to tax the biggest section of the population.

Ordinary people earning ordinary incomes.

1p on the lowest rate of tax will reap hundreds of times more than twenty p on the highest...

We are ALL going to pay for this monumental fk up.

[thinfourth2]

Don said:

1p on the lowest rate of tax will reap hundreds of times more than twenty p on the highest...

But they can't do that as that is simple and honest

[turbobloke]

reuters article linked by gingerpaul said:

Ernst and Young have calculated a 60 percent rate on those earning more than half a million pounds could raise 2 billion pounds.

So, it would appear that the genius gene pool at Ernst and Young have also calculated that Labour will be in power for 400 years.

[Elroy Blue]

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

Tax at 90% car allowance/ ban company cars/ tax 90% share options/ tax 90% bonus payments/ tax fuel cards/ tax discounts on employee goods bought at a discount (you now..all the things lowly public sector workers don't get!).

Never ceases to amaze me, a Government and a financial sector bankrupt the country, continue to pay themselves billions in bonuses and it's still the fault of dustmen, nurses, teachers and emergency services!!

[Nick_F]

Elroy Blue said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

Tax at 90% car allowance/ ban company cars/ tax 90% share options/ tax 90% bonus payments/ tax fuel cards/ tax discounts on employee goods bought at a discount (you now..all the things lowly public sector workers don't get!).

Never ceases to amaze me, a Government and a financial sector bankrupt the country, continue to pay themselves billions in bonuses and it's still the fault of dustmen, nurses, teachers and emergency services!!

Unfunded public sector final salary pensions were unworkable long before the current crisis.

[GT03ROB]

Elroy Blue said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

Tax at 90% car allowance/ ban company cars/ tax 90% share options/ tax 90% bonus payments/ tax fuel cards/ tax discounts on employee goods bought at a discount (you now..all the things lowly public sector workers don't get!).

Never ceases to amaze me, a Government and a financial sector bankrupt the country, continue to pay themselves billions in bonuses and it's still the fault of dustmen, nurses, teachers and emergency services!!

Sorry but your golden benefits are unaffordable, without the sort of tax rates your talk about on everyone. It's unsustainable, thats why the private sector which has to compete in the real world shed them years ago.

[WhoseGeneration]

Problem is, no system of social organisation has ever been able to reconcile the competing interests therein.
Or, control those who, by whatever means, rise to control the basis of that society.
"How to organise the affairs of Man".
The eternal question.
Still no definitive answer.

[FourWheelDrift]

If they do I hope they heavily tax their own Labour hierarchy since they have made personal fortunes. All rather Soviet in their self congratulatory windfalls. Useless Tub O Lard Prescott's recently announced (quietly) 2 Million pound government pension for starters.

[plasticpig]

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

[Jasandjules]

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

No need to worry about all that, simply change the law, like the c**t did with my private pension, stealing much of it.

[rypt]

plasticpig said:

They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

This

Or return the money paid in plus the correct amount of interest

Edited by rypt on Friday 4th December 22:21

[GT03ROB]

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

Utter nonsense. Final salary schemes can be closed to existing members. The final salary benefits are then restricted, to the period the individuals were in the final salary scheme, the balance of employment being covered by whatever scheme the employer brings in.

[plasticpig]

GT03ROB said:

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

Utter nonsense. Final salary schemes can be closed to existing members. The final salary benefits are then restricted, to the period the individuals were in the final salary scheme, the balance of employment being covered by whatever scheme the employer brings in.

You would see the whole of the public sector go on strike over such a move. Which admittedly would save some money but would also cause a lot of inconvinience.

[GT03ROB]

plasticpig said:

GT03ROB said:

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

Utter nonsense. Final salary schemes can be closed to existing members. The final salary benefits are then restricted, to the period the individuals were in the final salary scheme, the balance of employment being covered by whatever scheme the employer brings in.

You would see the whole of the public sector go on strike over such a move. Which admittedly would save some money but would also cause a lot of inconvinience.

No doubt there would be some hacked off public sector employees, but the reason this subject causes so much friction is that the private sector has seen it's pension provisions systematically destroyed by successive tax hits, whilst the public sector pensions have remained untouched. I've lost my final salary scheme so that the public sector can keep its.

[plasticpig]

GT03ROB said:

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

Utter nonsense. Final salary schemes can be closed to existing members. The final salary benefits are then restricted, to the period the individuals were in the final salary scheme, the balance of employment being covered by whatever scheme the employer brings in.

You would see the whole of the public sector go on strike over such a move. Which admittedly would save some money but would also cause a lot of inconvinience. This still wouldn't save any money in the short term as the problem is the commitment to pay existing pensions out of operational budgets.

[GT03ROB]

plasticpig said:

GT03ROB said:

plasticpig said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

It may in the long run but it's a very long run. Effectively you can only close the scheme to new employees. Its a contractual obligation to existing employees. They have paid their contributions and it is not their fault that succesive governments have failed to invest this money and have chosen to pay pensions from operational budgets instead.

Utter nonsense. Final salary schemes can be closed to existing members. The final salary benefits are then restricted, to the period the individuals were in the final salary scheme, the balance of employment being covered by whatever scheme the employer brings in.

This still wouldn't save any money in the short term as the problem is the commitment to pay existing pensions out of operational budgets.

Agreed, however all that is happening is putting off the day that final salary schemes will go in the public sector. They will be gone, make no bones about it, the sooner the lower the long term burden on the private sector.

[Kermit power]

Elroy Blue said:

musclecarmad said:

1. GET RID OF FINAL SALARY PENSIONS FOR THE PUBLIC SECTOR - this will save trillions in the long run, not just billions.

Tax at 90% car allowance/ ban company cars/ tax 90% share options/ tax 90% bonus payments/ tax fuel cards/ tax discounts on employee goods bought at a discount (you now..all the things lowly public sector workers don't get!).

Never ceases to amaze me, a Government and a financial sector bankrupt the country, continue to pay themselves billions in bonuses and it's still the fault of dustmen, nurses, teachers and emergency services!!

The difference between all the things you mention and final salary pension schemes is that the others are all paid for in the here and now.

At the end of the year, a company can look to its balance sheet and tick off the cost of all the perks and other costs of doing business against the income the company has received and come out with a clear profit or loss. With final salary schemes, that isn't possible, as its one big gamble - how well will investments do, how long will retirees live etc..

Let me give you an extreme example. My Grandfather started in a pensionable public sector role at the age of 21. He retired at the age of 65 on a final salary pension scheme fully linked to inflation. He died on New Year's Eve last year at the age of 97, still receiving his very healthy pension.

OK, not everyone lives for 32 years after they retire, but it is becoming increasingly common. He paid in for 44 years, and they paid back for 32. Can you begin to imagine how crippling that has to be, especially when you add in inflationary rises?

People aren't trying to blame nurses and dustmen. We don't think they're maliciously trying to bankrupt the nation or anything! It's just mathematically impossible to carry on the way things are with people now living for so much longer in retirement.