One really important question remains unanswered

[PeteHall]

Yeah, but the value is entirely created by the companies being there. They don?t have to be, the vast majority are not British. If you add tens of billions their tax bill, they might decide elsewhere would be more pragmatic. And that won?t be in the UK.

Brexit might be about to demonstrate that.

Companies pay tax wherever they are. Currently they pay huge rents to operate out of central London and it is the landlords who take the proceeds, not the nation.

See https://whoownsengland.org/2017/10/28/who-owns-central-london/

The purpose of LVT is to provide a fairer system, where tax is proportionate to your cost to society, it's not about nobody paying tax except Londoners. It discourages rent-seeking as a form of business and encourages productivity.

 

[mikem]

But those on low income cost the system a bigger percentage of their earnings than high flyers (who use private health care & schools)...

The problem with higher tax rates has always been that big earners can afford to either move elsewhere, or employ someone just to reduce their liability.

 

[JoshW]

But those on low income cost the system a bigger percentage of their earnings than high flyers (who use private health care & schools)...

The problem with higher tax rates has always been that big earners can afford to either move elsewhere, or employ someone just to reduce their liability.

fine, either they pay their way or go away..

 

[Fjell]

I have read various bits on LVT and I have yet to see any maths or modelling of consequences. My take is that it would be extremely minor in impact, because if it wasn?t it would be very damaging in a service-based economy. It is a tax on concentration and economy of scale, which is wholly in opposition to how productivity is achieved these days.
The highest value sheds I know of are probably Google?s server farms in the desert somewhere and the chip lab in Taiwan. Would you try to tax these sites at billions a year? Why? The land was worthless before they were built, and would be worthless if they left.

 

[mikem]

fine, either they pay their way or go away..

But they put more into the coffers than they will ever take out, so that's counterproductive - as same final bill will be shared by fewer people.

 

[JoshW]

fine, either they pay their way or go away..

But they put more into the coffers than they will ever take out, so that's counterproductive - as same final bill will be shared by fewer people.

That argument makes sense if, if you raised the taxes a little bit, everyone it affected would just leave. Which clearly isn't the case. Realistically I think a tiny portion of people would 'just leave' if the highest two tax brackets were increased, and you'd see net tax gains, but from slightly fewer people.

There are obviously other issues that need to be clamped down on, non-dom status, off-shore bank accounts, shell companies, inheritance trusts etc, and these are all issues that almost uniquely affect those that can afford to and should pay more tax.

 

[Fishes]

There are obviously other issues that need to be clamped down on, non-dom status, off-shore bank accounts, shell companies, inheritance trusts etc, and these are all issues that almost uniquely affect those that can afford to and should pay more tax.
[/quote]

Unfortunately many British voters were duped into protecting these by voting first for Brexit and then for a hard right Tory government.

 

[Fjell]

They have all those things in other European countries I have lived in. With knobs on in some cases.

WRT to nondoms, the Netherlands only taxes local income and exempts the first 30% of that. Denmark is the same pretty much. Both allow mortgage interest against tax, and it used to be all interest. It was possible to get tax relief for a house in the UK depending on how you arranged things.

They do these thing to get people to come and work there who they want to work there (there is a minimum income). The Dutch are exceptionally pragmatic with this sort of thing, and would do anything to get a chunk of business out of London.

 

[ChrisJC]

We are all missing the other side of the coin. Instead of tax more, why not spend less?

Chris.

 

[JoshW]

We are all missing the other side of the coin. Instead of tax more, why not spend less?

Chris.

be intrigued as to what's on your 'cut' list for taxes?

major options could be state pension, make it means tested?

 

[Duck ditch]

Exteme fines for Tax evasion and closing tax havens abroad. 

 

[darren]

We are all missing the other side of the coin. Instead of tax more, why not spend less?

Chris.

be intrigued as to what's on your 'cut' list for taxes?

major options could be state pension, make it means tested?

It wouldn't make much difference, but I can't understand why the government subsidise opera while death metal is left to live or die on its own merits.

To quote an anonymous politician " Most of us know what needs to be done to fix most of the country's problems. None of us know how to get re-elected after we do it"

 

[ChrisJC]

To quote an anonymous politician " Most of us know what needs to be done to fix most of the country's problems. None of us know how to get re-elected after we do it"

And that is the problem!

Chris.

 

[ChrisJC]

We are all missing the other side of the coin. Instead of tax more, why not spend less?

Chris.

be intrigued as to what's on your 'cut' list for taxes?

major options could be state pension, make it means tested?

Ha, well, it would be brutal! Something like this:
1. Population reduction by 50% in the next 100 years. No immigration, no assisted reproduction and a ban on women having more than 2 children. That would have two benefits - one is ecological - our environmental footprint would start to shrink rather than grow as it is presently. The other is that it would take the pressure off building. So we could stop building new houses and roads, and the price of houses and rental would start to fall.
2. Reframe the welfare state so nobody goes cold or hungry. Everybody is entitled to live in physical comfort without fear of hunger or security. But nothing more. If you want a car, sky TV, foreign holidays, earn the money. Reset the relationship between rights and privileges.
3. Sort out the ability to relocate for work. There are millions of job vacancies and millions of unemployed. Seems like the barriers to resolving that need to be fixed. Possibly a stick too.
4. Sort out the public sector and it's massive inefficiencies. Get rid of all of the non-jobs.
5. Sort out HM Government and their epic inability to procure / manage large projects. Get some IT experts into manage IT projects for example.
6. Strongly gear the economy towards export rather than import. Incentivise industries that add value to the economy by importing money, rather than just moving money around.

Don't worry, I'll never be elected!

Chris.

 

[nearlywhite]

Perhaps this thread should be renamed to many important questions remain unanswered.

But those on low income cost the system a bigger percentage of their earnings than high flyers (who use private health care & schools)...

A system for the poor becomes a poor system. The loss of sharp elbows and children who've been raised in households that value education is a big loss. 'Big earners' are valuable for more than just their money. As for private healthcare, it's a complete delusion that it saves any burden on the NHS, it's a queue jumping system where you privatise the profits and socialise the losses.

We are all missing the other side of the coin. Instead of tax more, why not spend less?

We're missing the fact that the coin is a selective measure of value. Things like 'social capital' often get completely ignored - see Amyarta Sen's on inequality where Black populations with at least 4 times the 'wealth' (on PPP controlled assets) have health and education outcomes far worse than the Keralese population in South India.

I don't think politicians do know what needs to be done, because that's a far harder question to answer than the previous posts suggest.

major options could be state pension, make it means tested?

Means testing doesn't always reduce the cost... See the fallacy of the 'we pay for your prescriptions' argument used against the welsh. England could have free prescriptions tomorrow at little to no cost if they wanted.

I came onto UKC to read some caving news and ended up talking bollocks on idle chat again... oops  :spank:

 

[mikem]

As for private healthcare, it's a complete delusion that it saves any burden on the NHS, it's a queue jumping system where you privatise the profits and socialise the losses.

Wasn't talking effect on NHS, but overall cost to government.

 

[JoshW]

major options could be state pension, make it means tested?

Means testing doesn't always reduce the cost... See the fallacy of the 'we pay for your prescriptions' argument used against the welsh. England could have free prescriptions tomorrow at little to no cost if they wanted.

I came onto UKC to read some caving news and ended up talking bollocks on idle chat again... oops  :spank:

There's already a means tested element to state pension, so the system is already there, and theoretically the admin of that could just be expanded.

Personally I'd rather see all the various welfare benefits (including state pension) rolled into a universal basic income scheme, which would simplify the number of different systems required throughout one's life, and therefore reduce 'admin costs'.

 

[mikem]

The eligibility checking systems generally end up costing much more than they save.

 

[Laurie]

I'd love to see a penny on Income Tax as long as the whole of it went to the NHS.

 

[JoshW]

The eligibility checking systems generally end up costing much more than they save.

The eligibility system already exists for state pension, so everything from here onwards theoretically is all savings.