FabSwingers.com > Forums > Politics > UK inflation hits 3.6%
UK inflation hits 3.6%
Jump to: Newest in thread
More bad new for the government as inflation hits 3.6%, the highest in the G7.
Makes things difficult for the Bank of England as it balances decreasing interest rates to aid the stagnating economy, against keeping rates where they are to depress inflation.
So much for Labour dealing with the cost of living crisis. Looks like the NI and pay increases hit working people after all.
|
Reply privately, Reply in forum +quote
or View forums list | |
 |
By *otMe66Man 1 day ago
Terra Firma |
Reeves is so dangerous, she knows the state the country is in but she is still trying to get her hands on people’s money, seems she won’t be satisfied until she’s emptied every last bank account, regardless of the damage done and coming down the line from her awful decisions as Chancellor.
In Tuesday’s Mansion House speech, she insisted that the financial industry must help shift the “negative” narrative around savers putting money in stocks and shares. Translated to, saving is bad, investing is good, now hand over the CGT to me.
We are now at the point where a Labour Chancellor is discouraging saving and pushing the public into riskier investments, under the banner of “growth”. It is unbelievable that she is pushing hard on this now as we are travelling towards an economic disaster in the country. Not exactly what the traditional Labour voter signed up for I would imagine. And as for the hard left populists, they must be fuming! Labour are openly pushing neoliberal capital market expansion.
The echo chambers will need a full system reboot.  |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *9alMan 24 hours ago
Bridgend |
worrying times for the nations finances, taking risks & investing in the stock market may seem like a good idea to the chancellor but history shows us it normally leads to a financial crash as in 1929 & 2008 |
Reply privately, Reply in forum +quote
or View forums list | |
How can people say that investing in the stock market is bad? If you have even a modicum of understanding of history you will know long term returns are far more likely to come from investing in companies than they are from putting it in a savings account.
The biggest risk that most people take is not taking any risk. Avoiding “risk” is pretty much guaranteed to give you the lowest return - and that’s likely to be at or even below inflation once adjusted. |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 22 hours ago
Terra Firma |
"So is the Tory party now against private investment in companies?"
The difference here isn’t about being “for” or “against” private investment, it’s about manipulating the incentives to force people into risk so the government can extract more tax revenue.
Labour’s approach is to undermine the value of ISAs and cash savings to make stocks and shares the only viable option of seeing a return on the money people have saved. That is coercion!
It is a crass move that uses peoples savings as an untapped revenue stream. The idea of pushing people into riskier markets during a self induced economic downtime so they can collect CGT is awful.
Even the most loyal Labour voter must be squirming at this, it’s tone deaf and shortsighted in a time of ever growing economic instability.
The timing smacks of desperation. |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 22 hours ago
Terra Firma |
"How can people say that investing in the stock market is bad? If you have even a modicum of understanding of history you will know long term returns are far more likely to come from investing in companies than they are from putting it in a savings account.
The biggest risk that most people take is not taking any risk. Avoiding “risk” is pretty much guaranteed to give you the lowest return - and that’s likely to be at or even below inflation once adjusted."
The choice of low risk returns are being taken away at a time we are walking into an economic downturn.
If this was floated at a time of economic stability there would be less of an issue. |
Reply privately, Reply in forum +quote
or View forums list | |
"Labour’s approach is to undermine the value of ISAs and cash savings to make stocks and shares the only viable option of seeing a return on the money people have saved. That is coercion!"
What has Labour done to undermine the value of ISAs and cash savings?
"The choice of low risk returns are being taken away at a time we are walking into an economic downturn."
What choices are being taken away?
|
Reply privately, Reply in forum +quote
or View forums list | |
"How can people say that investing in the stock market is bad? If you have even a modicum of understanding of history you will know long term returns are far more likely to come from investing in companies than they are from putting it in a savings account.
The biggest risk that most people take is not taking any risk. Avoiding “risk” is pretty much guaranteed to give you the lowest return - and that’s likely to be at or even below inflation once adjusted.
The choice of low risk returns are being taken away at a time we are walking into an economic downturn.
If this was floated at a time of economic stability there would be less of an issue. "
Periods of economic instability are when the money is generally made in the market.
Cash ISAs are a joke - the interest rates are so low anyway that you are saving less than sweet FA on the tax wrapper.
I am 100% for giving Reeves and Labour a kicking but Cash ISAs are not the hill to die on. |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 21 hours ago
Terra Firma |
"How can people say that investing in the stock market is bad? If you have even a modicum of understanding of history you will know long term returns are far more likely to come from investing in companies than they are from putting it in a savings account.
The biggest risk that most people take is not taking any risk. Avoiding “risk” is pretty much guaranteed to give you the lowest return - and that’s likely to be at or even below inflation once adjusted.
The choice of low risk returns are being taken away at a time we are walking into an economic downturn.
If this was floated at a time of economic stability there would be less of an issue.
Periods of economic instability are when the money is generally made in the market.
Cash ISAs are a joke - the interest rates are so low anyway that you are saving less than sweet FA on the tax wrapper.
I am 100% for giving Reeves and Labour a kicking but Cash ISAs are not the hill to die on."
You have your view and I have mine. The timing of this is off. |
Reply privately, Reply in forum +quote
or View forums list | |
"How can people say that investing in the stock market is bad? If you have even a modicum of understanding of history you will know long term returns are far more likely to come from investing in companies than they are from putting it in a savings account.
The biggest risk that most people take is not taking any risk. Avoiding “risk” is pretty much guaranteed to give you the lowest return - and that’s likely to be at or even below inflation once adjusted.
The choice of low risk returns are being taken away at a time we are walking into an economic downturn.
If this was floated at a time of economic stability there would be less of an issue.
Periods of economic instability are when the money is generally made in the market.
Cash ISAs are a joke - the interest rates are so low anyway that you are saving less than sweet FA on the tax wrapper.
I am 100% for giving Reeves and Labour a kicking but Cash ISAs are not the hill to die on."
Money is made in stocks and shares when their rise. This is at the end of economic instability not in the middle. The hard part usually is knowing when that end is. Luckily at the moment that’s the simple part. 2029 |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 21 hours ago
Terra Firma |
"Labour’s approach is to undermine the value of ISAs and cash savings to make stocks and shares the only viable option of seeing a return on the money people have saved. That is coercion!
What has Labour done to undermine the value of ISAs and cash savings?
The choice of low risk returns are being taken away at a time we are walking into an economic downturn.
What choices are being taken away?
"
She’s paused the reduction in the ISA allowance for now, but all indications are that it will resurface in the October budget. If it goes ahead, it will make ISAs less rewarding, particularly for those who favour security over risk.
Let’s be clear the strategy is to undermine the value of cash savings, nudging people into riskier (to them) investment products where the government can eventually collect capital gains tax.
The problem is timing. Right now is absolutely not the moment to start destabilising the savings groups. We are in a poor economic environment. Mortgage markets rely heavily on ISA held funds to support lending, and even the banks have warned her not to go ahead with this move.
Despite the warnings, she’s laying the groundwork, regardless of the consequences. It’s another example of how out of her depth she is as Chancellor. Her track record already reflects this.
We are already on a downturn and if this goes ahead and crashes like everything else she has pushed through, the damage will be high, it will hit savers, homeowners, and the economy all at once. |
Reply privately, Reply in forum +quote
or View forums list | |
I'm not a Labour supporter by the way but basically you are having a good old moan about something that hasn't even happened.
It's a joke. What's the best interest you can get on a cash ISA? I think it's about 4.5%.
If you have the maximum of £20k in one you'd get £900 in interest. The vast bulk of which would be wiped out by inflation.
Even if the ISA allowance was completely removed, basic rate taxpayers get a £1k PSA so wouldn't pay anything on £900.
Plus investors have a £3k CGT allowance so the idea that the government is aiming to extract load of money from small savers and investors is for the birds.
|
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 21 hours ago
Terra Firma |
"I'm not a Labour supporter by the way but basically you are having a good old moan about something that hasn't even happened.
It's a joke. What's the best interest you can get on a cash ISA? I think it's about 4.5%.
If you have the maximum of £20k in one you'd get £900 in interest. The vast bulk of which would be wiped out by inflation.
Even if the ISA allowance was completely removed, basic rate taxpayers get a £1k PSA so wouldn't pay anything on £900.
Plus investors have a £3k CGT allowance so the idea that the government is aiming to extract load of money from small savers and investors is for the birds.
"
Timing, read what I'm saying.
|
Reply privately, Reply in forum +quote
or View forums list | |
"Timing, read what I'm saying."
I read what you said and it's still ridiculous.
She's not made the change and even if she did it would have very little impact.
I'm far more worried about the impact of the nutjob in the White House on the global economy than any minor tinkering with cash ISA allowances. |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 21 hours ago
Terra Firma |
"Timing, read what I'm saying.
I read what you said and it's still ridiculous.
She's not made the change and even if she did it would have very little impact.
I'm far more worried about the impact of the nutjob in the White House on the global economy than any minor tinkering with cash ISA allowances."
"Ridiculous"
You have managed to get me to bail at a very early point in the discussion 
I will come back to this later in the year when a few things have dropped and you will hopefully understand what the call out was now.
Until then... |
Reply privately, Reply in forum +quote
or View forums list | |
"Until then..."
That should give you enough time to further polish your crystal ball. Then you'll be able to make another claim that you won't want to address until some mysterious future point in time. And on and on.
|
Reply privately, Reply in forum +quote
or View forums list | |
"Timing, read what I'm saying.
I read what you said and it's still ridiculous.
She's not made the change and even if she did it would have very little impact.
I'm far more worried about the impact of the nutjob in the White House on the global economy than any minor tinkering with cash ISA allowances."
“Minor” is a very subjective term.
And foreign governments have a lot less influence over our economy than our own government. Even Trump.
So, not a Labour supporter? Who would you vote for if the election was tomorrow? Just curious. |
Reply privately, Reply in forum +quote
or View forums list | |
|
By *otMe66Man 20 hours ago
Terra Firma |
"Until then...
That should give you enough time to further polish your crystal ball. Then you'll be able to make another claim that you won't want to address until some mysterious future point in time. And on and on.
"
I have learnt not to get dragged into discussions around economics with you, I was trying to be polite and leave because I had engaged. |
Reply privately, Reply in forum +quote
or View forums list | |
I don't see how a change in cash ISA allowance rates would have much impact on the UK economy compared with Trump's chaotic policy shifts which have caused enormous uncertainty and volatility in markets.
I realise that few here are exporters but part of my income stream is in US$ and the dollar has lost about 10% of its value since he came to power.
That means less money coming into the UK.
|
Reply privately, Reply in forum +quote
or View forums list | |
"People ought to remember that inflation reached 17.9% under Thatcher, 8% under Major and 7.9% under Johnson/Truss/Sunak.
"
Thatcher reduced the basic rate of income tax from 33% to 25% within her first two terms. This single act did more for the working class as they used to be called, than every act of every labour government combined.
When was the last time a labour government reduced taxation? |
Reply privately, Reply in forum +quote
or View forums list | |
"Gordon Brown reduced basic rate income tax to its current level of 20% in 2007
"
From what? 22%? So the conservatives reduce it to 22% from 33%…. So an 11 point drop, but Brown reducing it by 2% is a hero?
You do know 11 is more than 2? |
Reply privately, Reply in forum +quote
or View forums list | |
It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
|
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
"
And on top of those personal tax changes, labour and Tory 1997-2025 have increased the national debt by some 650% and with it the interest burden for the taxpayer.
No unpicking any of this in a hurry |
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
"
VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax. |
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax. "
income tax is at a record low .... plenty of scope to increase it without any realterm problems |
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax.
income tax is at a record low .... plenty of scope to increase it without any realterm problems"
Your statement is true, but how about this one…
Government spending is at a record high, plenty of scope to reduce it without any real problems |
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax.
income tax is at a record low .... plenty of scope to increase it without any realterm problems"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
|
Reply privately, Reply in forum +quote
or View forums list | |
"It's not really absolute numbers that matter but ratios.
Thatcher reduced basic rate income tax from 33% to 25%, that's a drop of about 24%
Brown reduced basic rate income tax from 23% to 20%, that's a drop of about 13%, nowhere near as big as 24% obviously but still a significant reduction.
But Thatcher put VAT up by 87.5%!
Still this is all ancient history. Thatcher left office 35 years ago.
The last reduction in basic rate income tax was under a Labour not a Tory government and the Tories were in power for 14 years and did nothing to reduce tax for regular working people.
But to be honest no recent government has had any room for maneuver so talk of reducing tax is just pie in the sky. The tax burden is probably going to continue to slowly increase unless we can somehow generate growth.
VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax.
income tax is at a record low .... plenty of scope to increase it without any realterm problems
Your statement is true, but how about this one…
Government spending is at a record high, plenty of scope to reduce it without any real problems "
yes, reduce war spending, policing, r&d, huge fossil fuel subsidies etc etc. |
Reply privately, Reply in forum +quote
or View forums list | |
"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
"
that's the concern of the private sector
.... have you tried writing to them to ask them to reduce their high costs? |
Reply privately, Reply in forum +quote
or View forums list | |
"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
that's the concern of the private sector
.... have you tried writing to them to ask them to reduce their high costs?"
On the contrary it’s a concern to the treasury and taxpayer who are paying £26bn a year in housing benefit alone to fund it. |
Reply privately, Reply in forum +quote
or View forums list | |
"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
that's the concern of the private sector
.... have you tried writing to them to ask them to reduce their high costs?
On the contrary it’s a concern to the treasury and taxpayer who are paying £26bn a year in housing benefit alone to fund it. "
and your proposal is to end housing benfit payments to private landlords and introduce a staute that requires them to house people? i'm all for it |
Reply privately, Reply in forum +quote
or View forums list | |
"UK unemployment up to 4.7%, highest since 2021.
Meanwhile public sector pay rises continue to run ahead of those in the private sector.
The only jobs growth area is in “health and social care”."
get a job in that sector then instead of constantly moaning that the government isn't wiping your arse then |
Reply privately, Reply in forum +quote
or View forums list | |
"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
that's the concern of the private sector
.... have you tried writing to them to ask them to reduce their high costs?
On the contrary it’s a concern to the treasury and taxpayer who are paying £26bn a year in housing benefit alone to fund it.
and your proposal is to end housing benfit payments to private landlords and introduce a staute that requires them to house people? i'm all for it "
The government is set to subsidise private landlords by more than £70 billion through paying them housing support over the next five years apparently.
2 million right to buys sold by red and blue and not replaced and Rayners 300,000 social housing not coming anytime soon. It was Osborne that cut higher rate mortgage relief to private landlords. 1.1 million on social housing waiting lists and 1500 on small boat arrivals every week to eventually join those lists
|
Reply privately, Reply in forum +quote
or View forums list | |
"
Maybe but other things at a record high. Rents up 6.7%, housing at 8 times income and mortgages being deregulated because of it
that's the concern of the private sector
.... have you tried writing to them to ask them to reduce their high costs?
On the contrary it’s a concern to the treasury and taxpayer who are paying £26bn a year in housing benefit alone to fund it.
and your proposal is to end housing benfit payments to private landlords and introduce a staute that requires them to house people? i'm all for it
The government is set to subsidise private landlords by more than £70 billion through paying them housing support over the next five years apparently.
2 million right to buys sold by red and blue and not replaced and Rayners 300,000 social housing not coming anytime soon. It was Osborne that cut higher rate mortgage relief to private landlords. 1.1 million on social housing waiting lists and 1500 on small boat arrivals every week to eventually join those lists
"
and your solution or are you simply all about moaning and grievance like the fab far righties? |
Reply privately, Reply in forum +quote
or View forums list | |
"yes, reduce war spending, policing, r&d, huge fossil fuel subsidies etc etc.
The UK doesn't subsidise fossil fuel companies. There's no money to be saved there."
yes they do. the windfall tax super deduction scheme alone gifts the oil and gas companies 11 billion .... this is just 1 of a number of subsidies gifted to fossil fuels.
so we can all only guess at why you are perpetuating a lie on these threads again and again. |
Reply privately, Reply in forum +quote
or View forums list | |
"UK unemployment up to 4.7%, highest since 2021.
Meanwhile public sector pay rises continue to run ahead of those in the private sector.
The only jobs growth area is in “health and social care”.
get a job in that sector then instead of constantly moaning that the government isn't wiping your arse then"
My work is just fine thanks.
It’s the future of young people that concerns me with no work available and endless taxes to pay for those that can get work. I have to say if I was 18-30 today I’d definitely be looking for a way to exit the UK. The future is bleak.
Not everyone can work for the public sector. I’m afraid that’s just economic illiteracy. |
Reply privately, Reply in forum +quote
or View forums list | |
"UK unemployment up to 4.7%, highest since 2021.
Meanwhile public sector pay rises continue to run ahead of those in the private sector.
The only jobs growth area is in “health and social care”.
get a job in that sector then instead of constantly moaning that the government isn't wiping your arse then
My work is just fine thanks.
It’s the future of young people that concerns me with no work available and endless taxes to pay for those that can get work. I have to say if I was 18-30 today I’d definitely be looking for a way to exit the UK. The future is bleak.
Not everyone can work for the public sector. I’m afraid that’s just economic illiteracy."
not everyone wants to put up with the inferior wages in public service compared to the private sector, that's true. glad your job is great, it does make your constant moaing all the more bizarre though, seeing as how none of what you constantly moan about affects you in any way. |
Reply privately, Reply in forum +quote
or View forums list | |
"UK unemployment up to 4.7%, highest since 2021.
Meanwhile public sector pay rises continue to run ahead of those in the private sector.
The only jobs growth area is in “health and social care”.
get a job in that sector then instead of constantly moaning that the government isn't wiping your arse then
My work is just fine thanks.
It’s the future of young people that concerns me with no work available and endless taxes to pay for those that can get work. I have to say if I was 18-30 today I’d definitely be looking for a way to exit the UK. The future is bleak.
Not everyone can work for the public sector. I’m afraid that’s just economic illiteracy.
not everyone wants to put up with the inferior wages in public service compared to the private sector, that's true. glad your job is great, it does make your constant moaing all the more bizarre though, seeing as how none of what you constantly moan about affects you in any way."
Ah yes, the reason Labour and Starmer are so unpopular is because the electorate are “moaners”. Perhaps also “thick”, “brainwashed”, “corrupted by the “right wing media”” etc etc.
If only they had your intellect and insight they would understand that Labour is in fact doing a marvellous job!
Time to change the electorate! Votes for 16 year olds!
|
Reply privately, Reply in forum +quote
or View forums list | |
"Time to change the electorate! Votes for 16 year olds!"
why not go one step further and make make them council leaders in failed county councils where the majority are, as you just called them, "thick", "brainwashed" and "corrupted"
|
Reply privately, Reply in forum +quote
or View forums list | |
"VAT is a tax I can control to some extent. I choose to buy or I don’t. Can’t say the same for income tax."
If you've never run a business then yes, you'll see it as just a consumption tax.
But if you are an entrepreneur it's a tax on turnover, unless you are exempt.
With VAT at 20% if your optimal price point for a product is say £100 then you can't just raise the price to £120 and expect to get the same volume. So you need to set the pre-VAT price 16.66'% lower at £83.33. Then add 20% VAT to get back to £100.
So your profit has dropped by £16.66 per unit becaue you have to give that £16.66 to the government for each sale.
If you are a sole trader with negligible inputs then this is in effect an increase of about 16% on your rate of income tax.
I've posted before about why I think VAT isn't a great idea (because it is regressive and attractive to the right because it's a way of taxing people on low incomes) but my point here is that VAT isn't some minor tax.
At £169 billion per year it's the main source of income for the government after income tax (£277 billion) and NI (£179 billion).
In comparison corporation tax is £97 billion and fuel duty is £25 billion. |
Reply privately, Reply in forum +quote
or View forums list | |
» Add a new message to this topic
