Click on image to enlargeMike Warburton of Grant Thornton has just sent out the above graph. He comments...
It's strange that a government that pledges support for those on low incomes can put a further dent in the pockets of these individuals by abolishing the 10p rate of income tax. The abolition of the 10p rate effectively makes low income earners reliant on the tax credit system. So rather than encourage individuals off benefits, the government is increasing their dependence on state assistance to maintain levels of income they were previously used to.I couldn't have put it better myself.
19 comments:
I can see how the new tax arrangements would benefit the poor. Gordon's policies so far have made it worthwhile for Shannon Matthews' mother to have seven children by 5 different fathers. I think she'll find it financially beneficial to have a few more once she's been released.
Those are hard words.I presume that all five fathers are up to date with maintencace payments to the Child Support Agency or whatever its called now. Surely its not we tax payers supporting Mrs/Ms.Matthews' life style.
Do hope that there are some further Government initiatves which deal with the likes of the Matthew family - other than throwing money at the problem.
Yarnesfromhorsham:
Get your facts right; most of the kids LIVE with their fathers therefore it should be the "mother" who should be paying maintenance.
Fat chance.
Why not just lift the bands at which tax starts and take those earning less than say 15,000 out of tax completely? I know that this may favour higher earners proportionately more (Grant Thornton check please) but surely it wuld be better than making them benefit dependent. Unless of course that is deliberate on the part of nuliebour.....?
Why is this an accusation? The Heffer piece pointing out that this is conspiracy not c*ck-up was on the money. A government which robs Peter to pay Paul, it can count on the support of Paul (GBS). The numbers are really scary, but this is what they set out to do, no?
Labours economic policies have always hurt those they were supposed to be helping.
briansj said...
", but this is what they set out to do, no".
Absolutely.
The next revision to the tax system will be to Pay All You Earn, and Gordon will give us all pocket money if we have been good.
Surely it's Gordon's intention to make "low earners" dependent on the state? He thinks low earners all vote Labour - but just in case they decide to start thinking for themselves, he wants to make sure they are totally dependent and therefore keep on voting for Big Daddy who's doling out the cash.
Have you noticed all this "We'll have a look at compensation for those who might lose out....." stuff? That is claiming back from the State your OWN MONEY, which the State shouldn't have taken in the first place.
Be good, children, or Daddy won't give you your pocket money........
"but this is what they set out to do, no?"
You have to ask? It was and is deliberate policy of Labour to create a vassal electorate.
They learned this from the knee of Peter Mandelson's grandfather, Herbert Morrison, who declared it was the intentions of the Labour GLC in the '30s to "build the Tories out of London" with a tidal wave of council housing.
Plus ca change.
Building a client state appears a main agenda for Labour.
Increasing the number of people dependent on benefits of various kinds is one strut of the unspoken policy.
The second strut is expanding the public sector whilst the third is expanded immigration.
Fortunately times are changing with more people in each category seeing the light and turning from Labour as their natural choice.
Oh how they cheered when Gordon Brown announced the 2p reduction in income tax! Tories dished! Brown the saviour of the poor! Mission accomplished!
Then, after the evening news bulletins, someone did the calculations.
Only in an absurdly complicated tax system could the Government get away with such sleight of hand.
I think that people affected by the 10p tax band cut simply haven't taken proper responsibility of their tax affairs like Labour stalwart Lord Sainsbury:
http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article3658376.ece
If they bothered to speak to their accountants I am sure they could be more tax-efficient - why not base themselves in Ireland for tax purposes for instance. Sometimes the poor are their own worst enemy.
Gordon has inadvertently clobbered a low paid but articulate and influential class. Those that have decided to retire early on low pensions having achieved their ambitions and are now doing the things they always wanted to do. Never in their wildest dreams did they realise that the Government would tax those dreams.
Funny old world.
A part time charity worker is now proportionally paying more taxes than a full time BANKER under Labour tax regs.
What sane person would give a person money for not working but take it away from them for working?
Bloody Gordon Brown!!!
Geoffh said ..." ... Herbert Morrison, who declared it was the intentions of the Labour GLC in the '30s"
The GLC didn't exist in the 1930s. It was created in 1965. You mean the LCC.
All Brown's policies - whether made with the best intentions or not - have backfired.
The minimum wage 'intiative' actually levelled down wages. Employers regularly advertise jobs which 'meet minimum wage' thinking that this is a living wage. Well, it's about as realistic as the Government's inflation figure.
Meanwhile, the Government propose tax credits which can 'top up your income'. Hmmm. Why should you need a top up if you are being paid the national minimum wage?
Correcting the whole imbalance costs a fortune in public servants and paperwork.
Brown's 'Fuzzy Maths' don't work at any level. The cost of scrapping a few pence in taxes to the poor will always be cheaper than collecting from them, then laboriously readjusting the claimants. and then maybe reimbursing them - or even ovepaying them and then reclaiming - a familiar double cycle.
A single, simple cash transaction in a supermarket costs the owner £4 . . . three times that if by credit card. So you can imagine what this tax/tax credit mess costs the country.
Brian SJ - Agreed.
I wish people would stop referring to them as Labour and give them their true name: communists. Centrally planned economy and everyone beholden to the state.
Well said, Geoff H!
Of course they're increasing the dependence. It"s the game plan.
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