First Budget after the election

First Budget after the election

Didn't find your answer?

I have been idly asking myself what I would do in my first Budget if I were the Chancellor after the 2010 election.  Here's my 'manifesto':

VAT

Abolish the reduced rate of VAT (currently 5%) - all currently reduced rate items to be chargeable at the standard rate.

Increase standard rate of VAT to 25%

Standard rate: UK postal services, transport of passengers within the UK (rail fares, etc), financial services, and insurance.

Abolish insurance premium tax.

STAMP DUTY LAND TAX

Replace current rates of 1%, 3% and 4% with new 5%, 15% and 20% rates.

INCOME TAX

Introduce 10% tax rate for first £5,000 of taxable income (of any description)

Basic rate to be 30% on next £35,000 of taxable income

40% rate on next £60,000 of taxable income

50% rate on next £150,000 of taxable income

60% rate on next £250,000 of taxable income

75% rate on remaining taxable income

Personal allowance of spouses / civil partners to be available to each other

CAPITAL GAINS

Capital gains to be chargeable at income tax rates, but with top slicing relief - so CGT payable on a gain of £x on an asset held for y years would be: y times (income tax payable on additional income of (£x divided by y)).

INHERITANCE TAX

Main private residence to be exempt from IHT (i.e. disregarded altogether)

New IHT rate of 60% on taxable value over £1 million

ROAD FUND TAX

Current rates applicable to motor cars tripled (no change on rate for push bikes!)

NATIONAL INSURANCE 

Employees contributions abolished - Employers contributions unaffected

STATE BENEFITS / MINIMUM WAGE RATES

Benefit rates / Minimum Wage rates to be increased immediately corresponding to anticipated increase in inflation resulting from these Budget measures

DEFENCE SPENDING

Orders for aircraft carriers, warships, submarines and fighter aircraft to be cancelled

Defence review to remodel armed forces to limit their role to (i) peace-keeping / humanitarian duties with EU and UN, (ii) assisting emergency services in UK (air-sea rescue, etc), and (iii) ceremonial functions.  Current expenditure circa £40 Bn annually to be reduced to £5 Bn annually (at January 2010 prices) over a period of 5 years

CIVIL SERVICE 

Close the current Civil Service superannuation arrangements to new public sector employees.  Introduce a new superannuation scheme similar to those now being adopted in the private sector

OVERVIEW

The objective of the Budget would be to make everyone worse off (except the poorest), so recognising the realities of our situation.  It would be intended to act as a break with the past and a reality check with regard to our economy and place in the world.

However it may be that with this manifesto I would be unlikely to win the election!

Anyone else got any better ideas?

David

Replies (31)

Please login or register to join the discussion.

By petersaxton
10th Jan 2010 14:16

My suggestions

VAT

I agree. Spending on non-necessities has to be discouraged.

Income tax

No lower rate, it just causes too many complications; 50% should be the top rate, otherwise it just discourages work and enterprise.

Increase personal allowances to £15,000 so that many more people are taken out of tax.

National insurance

Abolish it totally - we need to encourage employment.

Wages

Abolish minimum wage - we need to encourage employment.

Defence spending

Increase spending - it's been cut too much already

Review spending:

Review public services for usefulness and efficiency.

Withdraw long term benefits for those capable of working.

Ensure educational institutions provide a quality education. Close the institutions that are useless.

 

Thanks (0)
Rebecca Benneyworth profile image
By Rebecca Benneyworth
10th Jan 2010 14:32

Masters of our own destiny?

Sadly some of the VAT changes you propose would not be allowed under EC law. Won't comment on the rest, but it does show that our power to sort out the mess is to a small extent controlled beyond our shores!

Thanks (0)
avatar
By welsh_dragon
10th Jan 2010 14:44

Desirable but sadly not achievable

I would immediately argue with one of your proposals.

 

Road Fund Tax

- should be abolished thereby making huge savings in the cost of DVLA.  Instead a 2p/litre levy on fuel would pay for road maintenance & building - those who drive most would pay most which seems fair.  Only 20% of the current income from Road Tax should be raised as that is the proportion currently spent on roads.

All vehicles to display an "Insurance disk" to reduce the number of uninsured drivers.

All cyclists to be tested and to pay a compulsary insurance and display insurance disk. They use the roads, they should help pay for them.

 

Taxes / VAT

The entire taxation system requires a complete overhaul. 

VAT is an iniquitous tax as the poor and rich pay the same tax on an item which cannot be right. With our withdrawal from the EU we should abolish VAT.

The "special" taxes/duties on petrol, tobacco, alcohol should be abolished.

No one should pay tax until they reach the official poverty line, (currently around £8,500 pa), and no one on benefits or pensions should received less than this amount.

The standard rate of income tax should be raised to compensate for these adjustments after taking into account cuts in expenditure. Tax should be based upon the citizens ability to pay.

 

Public Services & social policies

Massive cuts in unessential public services and government (including local government) spending would be made. All so called "equality" policies, all overseas aid, all "politically correctness" etc would be abolished.

A thorough overhaul of immigration to be carried out with no further immigrants allowed to enter the country and non productive immigrants, those who have not attempted to integrate, and those who entered illegally, to be immediately deported.

An overhaul of the civil service with a view to halving the numbers employed and making the rest productive.

 

Defence

Increases in defence spending to ensure our forces are properly equiped to carry out the functions we ask of them.

 

Education

Reduction in school holidays.  All "training" days etc for teachers to be held during school holidays to ensure that children actually get an education.

The abolition of the "equalities" drivel currently taught and a return to core values of actually teaching children to read and write.

A return to absolute discipline in our schools.

 

Law & Order

The removal of all "rights" for anyone caught unlawfully entering another's property.

Simply being a drug addict (not dealing but simply taking drugs of any "class") to become an offence with compulsary rehabilitation sentences.

 

Pensions

An increase in the state pension for all, paid for by the immediate abolition of civil service gold plated pensions. 

 

Achievable - NO.

Desirable - YES

 

 

 

 

Thanks (0)
avatar
By User deleted
10th Jan 2010 15:24

davids budget

how will this not make the poorest off more poor?

Thanks (0)
By petersaxton
10th Jan 2010 16:37

Spot the nonsense

"Road Fund Tax

 - should be abolished thereby making huge savings in the cost of DVLA.  Instead a 2p/litre levy on fuel would pay for road maintenance & building - those who drive most would pay most which seems fair."

"VAT is an iniquitous tax as the poor and rich pay the same tax on an item which cannot be right."

A 2p/litre levy on fuel must be an iniquitous tax as the poor and rich pay the same tax on an item which cannot be right?

 

 

Thanks (0)
avatar
By welsh_dragon
10th Jan 2010 18:18

Peter

 

Spot the nonsense  Posted by petersaxton on Sun, 10/01/2010 - 16:37

 

So you think it fair that a pensioner driving a couple of thousand miles a year should subsidise the company executive driving 50,000 miles a year?

You think it fair that a pensioner living on £100 a week should pay the same amount of VAT on purchases as a worker earning £1,000 a week? 

You believe it right that governments lie by taxing motorists to pay for the building and upkeep of roads, then divert 80% to other uses instead of being honest? 

I did say my suggestions were ideal but not achievable, but they would represent social justice, which is something that is being eroded daily by the present scurrilous apology for a government.

The current tax regime is grossly unfair & unjust and is seen as such by all right minded people.

And, of course, I ommitted the one thing that would save this country more than everything else put together.  An end to our membership of the pseudo-facist EU nightmare.  

 

 

 

   

Thanks (0)
By petersaxton
10th Jan 2010 18:26

Contradictory

I'm pointing out that you seem to think that it is ok for both the poor and rich to pay the same tax of 2p per litre for petrol but not the same 2p in VAT.

By all means state your case sensibly for each but in this situation you seem to be arguing against yourself.

Thanks (0)
avatar
By User deleted
10th Jan 2010 19:20

David

You are clearly no economist. Your suggestions would probably resut in hyper inflation.

The savings HAVE to come from employing far fewer in the public sector and that includes the much bloated local authorities, but by paying decent salaries to attract the best even if that increases the numbers of less competent individuals being on benefits.

Try to ensure that in both education and health that up to date technology is used and that less administrative staff are needed.

 

 

Thanks (0)
avatar
By welsh_dragon
10th Jan 2010 19:21

peter

Which simply shows how inequitous the current taxation system is.

However, what I am saying is that all motoring costs should be related to the amount of mileage driven.

 

 

Thanks (0)
avatar
By User deleted
10th Jan 2010 19:24

David

You are clearly no economist. Your suggestions would probably resut in hyper inflation.

The savings HAVE to come from employing far fewer in the public sector and that includes the much bloated local authorities, but by paying decent salaries to attract the best even if that increases the numbers of less competent individuals being on benefits.

Try to ensure that in both education and health that up to date technology is used and that less administrative staff are needed.

 

 

Thanks (0)
By petersaxton
10th Jan 2010 19:30

WD, you are still not making sense

“Which simply shows how inequitous the current taxation system is.”

This is your proposal. It is not the current tax system.

“However, what I am saying is that all motoring costs should be related to the amount of mileage driven.”

Even if it affects rich and poor equally? Why don’t you apply that logic to VAT?

Thanks (0)
David Winch
By David Winch
10th Jan 2010 22:10

Protecting the poorest

The proposals included inflation-linked increases in rates of State Benefits and the Minimum Wage, a lower rate income tax band and abolition of employees' NIC, as well as availability of spouse's / civil partner's tax allowance, all of these primarily with the intention of protecting the poorest from / compensating them for the effects of other measures proposed.

David

Thanks (0)
David Winch
By David Winch
10th Jan 2010 22:21

Risk of hyper inflation

The proposals would most certainly be inflationary.  They would also risk triggering demands for higher wages but who knows how that scenario might develop.  A lower standard of living for the majority of UK citizens would, in my view, be a very likely outcome (but I regard that as necessary and inevitable).

At the same time one might expect house prices to fall and the number of unemployed people to rise.

There would also be a risk of some businesses or individuals leaving the UK to seek lower taxes overseas.

It could be argued that we would risk damage to the international status of the City of London as a global financial centre and that this would be damaging to the medium / long term interests of the UK as a whole.

But I do not see a great risk of HYPER inflation in the current economic climate.

The proposals are also somewhat 'green' in terms of higher taxes on transport and domestic fuel and power (on which the VAT rate would rise very significantly).

David

Thanks (0)
avatar
By welsh_dragon
10th Jan 2010 22:30

Perfect sense

WD, you are still not making sense

 “However, what I am saying is that all motoring costs should be related to the amount of mileage driven.”Even if it affects rich and poor equally? Why don’t you apply that logic to VAT?

Posted by petersaxton on Sun, 10/01/2010 - 19:30

 

It makes perfect sense.

1) VAT should, quite simply be abolished.  If a pensioner purchases a pack of cigarrettes he pays £1 in VAT.  If a millionairre purchases the same pack, he pays £1 VAT.  That is quite simply wrong.  To the pensioner it is 1% of his weeky income - to the millionaire it is perhaps 0.0001%.

2) Road Tax is, supposedly, to pay for building and maintaining highways (roads in towns & cities being paid for from council tax).  Therefore, the fairest way to fund that is by a levy of fuel, those who use the most pay the most.  Again, the wealthiest tend to drive the furthest, and, tend to have the thirstiest cars, so, they pay the most. 

 

As I have said before, the one largest saving that can be made, is the scrapping of the EU in its current pseudo-facist form, and a return to the original purpose of the EEC, namely a group of countries simply allowing free trade across their borders .  That is what it opriginally was, and, is what it should have remained.

Net saving to Great Britain plc by not subsidising Bulgarian gas lamp fitters etc etc - about £40 million a day.

 

 

 

 

Thanks (0)
avatar
By welsh_dragon
10th Jan 2010 22:49

Green taxes ???????

The proposals are also somewhat 'green' in terms of higher taxes on transport and domestic fuel and power (on which the VAT rate would rise very significantly).

David

 

Posted by davidwinch on Sun, 10/01/2010 - 22:21

 

David - Forget the "green" proposals.  If you keep up to date with the arguements over so called "climate change", you will know that a large body of scientific opinion is that we are entering a mini ice age (which will last about 20-30 years) and that this could have been triggered by the reductions in CO2 emmissions.  Shot ourselves in the foot again. 

This whole "global warming" rubbish is utterly discredited by the vast majority of scientists, (30,000 signed a petition stating it was utter drivel).  The earth has repeatedly warmed and cooled, the fossil record shows that the UK was tropical before the last ice age - which we are still moving out of.  Now there was no man to cause emmissions to trigger that bout of warming, (except for a few distant ancestors swinging in trees) so, I can only assume it was caused by excessive dinosaur flatulance.

"Green taxes" are the biggest con the taxpayer has ever been subjected to. They might as well levy an Easter Bunny tax - it would bear just as much relevance to the truth.

It is no surprise that the green zealots have now started refering to those who oppose them as "climate change deniers" just like the religious zealots portrayed their opponents as heretics in the middle ages. No doubt soon anyone who does not subscribe to their demented theories will be burned at the stake.

Gettig rid of this new "green religion" would be another way to help balance the books and cut down on wasted taxes. 

 

Thanks (0)
By petersaxton
11th Jan 2010 00:14

tax on petrol and VAT are both consumption taxes

Road tax is a tax like anything else. Don't think it is ring fenced.

There's no difference between a tax on petrol and VAT on anything else.

Thanks (0)
avatar
By User deleted
11th Jan 2010 09:22

Re-establish the dog license ........

......... and make it £1,000 for all except those with a 'professional' dog (guide dog, police dog etc). Also an exemption for the elderly.

It may not raise money but it'll clear the streets of the pointless creatures.

Thanks (0)
By JCresswellTax
11th Jan 2010 09:59

Dog Licence

Be quiet thats an idiotic comment, I could say the same about accountants.

Thanks (0)
By petersaxton
11th Jan 2010 11:38

It's not fair
"Re-establish the dog license ........

......... and make it £1,000 for all except those with a 'professional' dog (guide dog, police dog etc). Also an exemption for the elderly.

It may not raise money but it'll clear the streets of the pointless creatures."

But it's not fair that rich and poor have to pay the same amount ............... cue being led away by people in white coats ......

 

Thanks (0)
By mwngiol
11th Jan 2010 11:46

Green

"It is no surprise that the green zealots have now started refering to those who oppose them as "climate change deniers" just like the religious zealots portrayed their opponents as heretics in the middle ages. No doubt soon anyone who does not subscribe to their demented theories will be burned at the stake."

Burned at the stake? Not very green is it...35% levy on all stake burnings.

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 12:11

Dog Tax

How about taxing those who dont appreciate dogs.

And those who post such daft ideas as taxing dogs.  Why not a special tax on tasteless people who drive BMW's or 4x4's?

 

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 14:22

Men in white coats?

But it's not fair that rich and poor have to pay the same amount ............... cue being led away by people in white coats ......

 

Posted by petersaxton on Mon, 11/01/2010 - 11:38

 

Who do you think you're kidding?  Why would they want to lead you out of that comfortable padded "office" you have - lol.

Thanks (0)
avatar
By pauljohnston
11th Jan 2010 15:29

reality Check

See what they have done in Ireland.

Civil Servants have to contibute to their pension.

Some welfare payments have been cut so that the falling hourly wage rate does not make it better to collect benefits.

In the Uk one paper I saw said that UK Civil Servants have better wage conditions and pensions than those in the private sector - a result of the recession.  I am one for cutting the administration side of Civil Service and Local Government may be by as much as 50% in 10 years.

Road Tax should be abolished and tax added to fuel.  This makes it a green tax, the more you drive the more you pay.

I would like to see VAT at 20% if only to make the sums easier.

What is the definition of a poor person please.

 

 

 

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 16:04

Poverty

What is the definition of a poor person please.

 

Posted by pauljohnston on Mon, 11/01/2010 - 15:29

 

According to the government anyone with an annual income of less than £8,500.

Which means that the government taxes people who are still in poverty, and pays pensions & benefits that dont even reach their own poverty level.  Immoral.

 

Thanks (0)
By petersaxton
11th Jan 2010 16:19

You think the government has any idea?

“Poverty

What is the definition of a poor person please.

Posted by pauljohnston on Mon, 11/01/2010 - 15:29

According to the government anyone with an annual income of less than £8,500.

Which means that the government taxes people who are still in poverty, and pays pensions & benefits that dont even reach their own poverty level.  Immoral.”

Just because the government says something it doesn’t make it true.

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 18:08

£12,000 ?

 

Just because the government says something it doesn’t make it true.

Posted by petersaxton on Mon, 11/01/2010 - 16:19

 

In the case of this government - it's a guarantee that it isn't true.

Personally, I would suggest £12,000 pa as pretyy much poverty line.

Thanks (0)
By petersaxton
11th Jan 2010 19:43

One Yorkshireman's view

I'd go the other way. It is just being able to afford the bare essentials - no pets, tv, etc.

I had to get up in the morning at ten o'clock at night half an hour before I went to bed, drink a cup of sulphuric acid, work twenty-nine hours a day down mill, and pay mill owner for permission to come to work, and when we got home, our Dad and our mother would kill us and dance about on our graves singing Hallelujah.

And you try and tell the young people of today that ..... they won't believe you.

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 19:48

I wonder why ?

And you try and tell the young people of today that ..... they won't believe you. 

posted by petersaxton on Mon, 11/01/2010 - 19:43

 

 

 

I wonder why?

Do they have accountants in Yorkshire?  Have the missionaries finally got that far north ?

 

 

Thanks (0)
By petersaxton
11th Jan 2010 21:27

Southerners are scared to go up north

It appears they do have accountants in Yorkshire. Last year I found out that an old school pal is senior partner at one of the biggest independent firms in Hull.

I don’t know about missionaries going north but I know a lot of northerners have come to London to sort out the incompetent buffoons that are to be found in London. I’ve been doing my missionary work in London since 1973.

Thanks (0)
avatar
By welsh_dragon
11th Jan 2010 22:55

Canibals in Yorkshire ?

That's not missionary work. You might have a mild civilising effect on the natives, but the definition of a true missionary is a Welshman entering England.

We did send some to a place called Leeds but they never returned. Rumour has it that the natives ate them.

And we dont bother with London any more - who can be bothered to learn the 200 different languages needed to communicate with the current inhabitants.

 

Your comment puts me in mind of an old client of ours. He was a salesman with Anglia Windows when the double glazing boom started, and he made a small fortune.  He always said he refused to sell double glazing anywhere north of Sheffield. If you asked him why, he would just say, have you ever tried measuring up a cave to fit windows?  

 

Thanks (0)
By petersaxton
11th Jan 2010 23:05

It takes all sorts

When I see you I always remember a story my mother used to tell about my dad.

They were on holiday and they got friendly with a couple and used to go out together. One day my dad said: "I don't like the Welsh". My mother said: "But XXXX (the other guy they were with) is Welsh". My dad: "I don't care. I never liked them and never will."!

I don't think the comment was prompted by anything this guy had done or said - more likely from his time in the army in the second world war.

Thanks (0)