Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
When you include all the tax changes that are happening (from previous budgets) for the coming tax year, then the one change that dwarfs all the others is fiscal drag from the frozen thresholds and a 10% rate of inflation.
That single decision is such a massive increase in tax. It makes the 1p cut in the basic rate of income tax such a cynical move. Almost everyone will pay more income tax, but HMG will go around saying that they've cut income tax.
I asked PB’s biggest budget fan - @BartholomewRoberts - about the issue of fiscal drag yesterday. He didn’t reply.
I can't respond to every post, but I did respond to the issue yesterday when asked by Foxy.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Not really. I don't have it to hand but try to picture that graph with the y-axis as a % of income rather than an nominal £ scale. Percentage wise the lowest earning tax payers (including those brought into taxation by inflation) are paying the biggest percentage.
Just eyeballing it, the highest % increase is around 60k and even 120k is bearing a higher % increase than almost any of the low-paid groups except entrants into the tax net - 120k is also the group that began pre-Covid on punitive marginal tax rates discussed elsewhere in the thread, noting that we're talking only about the _extra_ after 2020.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
If Trussnomics collapses in a Sterling crisis and Barberesque boom, the current regime would not be replaced with another tax cutting ideologue like Badenoch.
Wallace is the dullard on which people project their hopes.
It may be the second coming of Johnson, or perhaps the revenge of Sunak, who did rather better in the members poll than expected.
Yes, I was thinking Sunak might have a chance in the event of an early Truss crash.
Except that, if Truss crashes, her successor really is taking over as a placeholder before the Conservatives lose big in late 2024.
That requires a curious mixture of attributes, because it won't be fun at all. Who has the stoicism to pull that off with dignity and get past the nutters in the party?
St Theresa. People talking about a previous PM coming back have been looking at the wrong target. Its astonishing how fast the Maybot's reputation has been rebuilt from her "ahem" position on the back benches.
I don't think any Tory wants to live through another Theresa May General Election campaign.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
The withdrawal of the personal allowance at £105 000 causes a marginal rate of 61%, so a bit of a high tax zone before going back to 41% at £125 000.
It does affect behaviour. Some of my colleagues have cited this as well as the annual allowance rules as a reason to cut hours.
Indeed, see my next post on the subject. Tax allowance withdrawal starts at £100k along with the idiotic situation where someone with £99,999 earnings getting childcare and £100,000 not.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Yes, it was interesting seeing this from the IFS. On the one hand not as regressive as the headline tax changes because the fiscal drag effect was progressive, but on the other hand, politically: hitting the middle class to benefit the very rich is electorally brave.
The politically most astute tax measure would have been raising the higher rate band to 80k as had been rumoured. That would have set Labour a trap. A lot of swing voters at the 50-60k level who wouldn’t have taken kindly to being described as rich.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Not really. I don't have it to hand but try to picture that graph with the y-axis as a % of income rather than an nominal £ scale. Percentage wise the lowest earning tax payers (including those brought into taxation by inflation) are paying the biggest percentage.
Just eyeballing it, the highest % increase is around 60k and even 120k is bearing a higher % increase than almost any of the low-paid groups except entrants into the tax net - 120k is also the group that began pre-Covid on punitive marginal tax rates discussed elsewhere in the thread, noting that we're talking only about the _extra_ after 2020.
No. 3.6% increase at £16k . Next peak is 2.45% increase at £64k earnings.
Increase in tax as a % of earnings is 1.2% at £120k.
The Chancellor’s huge package of personal tax cuts will disproportionately benefit London and the South East – with households in these regions standing to gain to three times as much on average (£1,600) as those living in Wales, the North East and Yorkshire (£500) next year. https://twitter.com/resfoundation/status/1573570479016878086/photo/1
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
It was Kwasi's one chance to do something about it, and he did jack shit because ideology.
Isn't he a mate of @rcs1000 and he said he was sensible?
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
They are also propped up by unusually high second hand values at present. Those are not likely to be sustained.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
Do have to boggle at little at the rivers of diarrhoea which makes up post-Brexit Tory politics. We've just finished summer 22. The Brexit vote was summer 16. In the 6 years since we have had 2 elections, 4 Prime Ministers, 6 Chancellors. We get a new PM and get told its a "new government" as if there is no continuity with the previous.
Whats more, look at the economic policies. The "fuck the poor" policies of Kamikaze are a million miles from "we're all in this together" of Osborne. And yet it is the same party. With an evolution of the same politicians. Supposedly with a mandate from voters which is consistent and cumulative.
But is the Tory government of late summer 2022 remotely the same as the Tory government of early summer 2016?
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Have you thought about part funding with 0% spend credit cards and 0% balance transfer cards with zero transfer fee. I think we discussed this a few years ago. When I had a mortgage I funded 100k of the loan this way. Need to be sure you can pay off or transfer the balance before the interest rates kick in but you normally get 2 years to plan that. I have done a lot less now I don't have a mortgage and interest rates have been low, but I still have £30k, not due to be paid of for 2 years which I invest.
Thanks, that sounds sophisticated. But I will look into it.
I'm building a financial model tonight to model various risk scenarios over the next 5-10 years. Will help me decide what's best for my family.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
Yes, the £100k crap should definitely have been removed. It leads to perverse decision-making at the margin around that level, such as you highlight. See also doctors.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
Kwarteng went for the headline of ‘I’ve abolished the top rate’ instead. He’s supposed to be smart, but that decision shows he’s deeply unserious.
I imagine Kwazi sees 150k or so as not being that high paid and therefore thinks he’s offering support to the middle class.
I remember a US GOP politician being ridiculed a few years ago - was it Romney? - for suggesting the middle class was anything up to $250k.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
PCP are weird though. The level is based on the difference between the value now and the value when it’s returned, which means that posh brands often end up being way cheaper than Vauxhall / ford are even when the initial retail price is lower.
BMW Finance recently sent me an offer for an 840i M Sport Gran Coupe on a 9+35 lease for £770/month. That car lists at well over 80 grand new with the options. I have no idea how anybody involved is making any money.
Imagine on that graph if instead of saying "you're poorer because evil rich people", the IFS more accurately said "you're poorer because of lockdowns". The Twitter likes from social science professors and scuffed left basement dwellers would vanish.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
They're not even rolling all of them, they've cherrypicked the ones that help their case. To include the frozen tax threshold change but not include the rise in NI threshold change is odd.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
No it's a dreadful indictment on those setting the odds. They have no idea about the Conservative Party. No way on earth is Boris coming back.
Wallace way too short. Once Truss goes, it is very likely Wallace is persuaded to become PM in a coronation.
Oh come off it MM that's wishful thinking, it's Johnson, and he will likely as not win a honeymoon election.
I just hope and pray Liz hasn't emulsioned over the Lulu Lytle.
Funny how people in other parties love telling me what the Conservatives will do.
One thing that won't happen if Truss goes is a membership vote. It will be a coup. Change in 24 hours.
Oh, and Kwarteng on 19s? LOL. If Truss goes, Kwarteng goes as the architect of the fiscal policy that caused her downfall. Unless of course it is massively successful - and he is her anointed successor about 9 years down the line. But I'd be wanting more than 19s to tie up money on that outcome!
Wallace is the value in that field.
I am not of other parties, but I brush shoulders with loyal Johnsonians Conservatives all the time, and I am aware of how the Conservative Party selectorate works both inside and out of Parliament. Johnson remains hugely popular in Tory circles and (after Truss, I suspect MPs desperate to keep their seats) if there is a coronation that satisfies the blue rinse brigade it is Johnson's. They quite rightly believe a chastened and cleansed Johnson will win the next GE, irrespective of the economic chaos left by Kwartang. To a large element of the electorate Johnson is a working class hero and a national treasure whether you and I like it or not.
Yes he will crash and burn your party and the nation in Government (again) which is why you (and I) want Wallace next time. Then just imagine the drear-fest Wallace v Starmer would generate.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
The withdrawal of the personal allowance at £105 000 causes a marginal rate of 61%, so a bit of a high tax zone before going back to 41% at £125 000.
It does affect behaviour. Some of my colleagues have cited this as well as the annual allowance rules as a reason to cut hours.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
No it's a dreadful indictment on those setting the odds. They have no idea about the Conservative Party. No way on earth is Boris coming back.
Wallace way too short. Once Truss goes, it is very likely Wallace is persuaded to become PM in a coronation.
Oh come off it MM that's wishful thinking, it's Johnson, and he will likely as not win a honeymoon election.
I just hope and pray Liz hasn't emulsioned over the Lulu Lytle.
Funny how people in other parties love telling me what the Conservatives will do.
One thing that won't happen if Truss goes is a membership vote. It will be a coup. Change in 24 hours.
Oh, and Kwarteng on 19s? LOL. If Truss goes, Kwarteng goes as the architect of the fiscal policy that caused her downfall. Unless of course it is massively successful - and he is her anointed successor about 9 years down the line. But I'd be wanting more than 19s to tie up money on that outcome!
Wallace is the value in that field.
Why didn't Fat Legolas run last time? He must know he hasn't got a hope of the NATO job. (Not a woman, not Eastern European, not on good terms with the EU)
Quite possibly he and his family didn't fancy the Downing Street wallpaper...
But if the Party comes crawling on its knees to him? Who could refuse that call?
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Not really. I don't have it to hand but try to picture that graph with the y-axis as a % of income rather than an nominal £ scale. Percentage wise the lowest earning tax payers (including those brought into taxation by inflation) are paying the biggest percentage.
Just eyeballing it, the highest % increase is around 60k and even 120k is bearing a higher % increase than almost any of the low-paid groups except entrants into the tax net - 120k is also the group that began pre-Covid on punitive marginal tax rates discussed elsewhere in the thread, noting that we're talking only about the _extra_ after 2020.
No. 3.6% increase at £16k . Next peak is 2.45% increase at £64k earnings.
Increase in tax as a % of earnings is 1.2% at £120k.
Ok. It's still a lot more than the increase on £40k or £45k, and needless to say the net effect from starting point is still that they pay bags more tax.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
PCP are weird though. The level is based on the difference between the value now and the value when it’s returned, which means that posh brands often end up being way cheaper than Vauxhall / ford are even when the initial retail price is lower.
BMW Finance recently sent me an offer for an 840i M Sport Gran Coupe on a 9+35 lease for £770/month. That car lists at well over 80 grand new with the options. I have no idea how anybody involved is making any money.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
The withdrawal of the personal allowance at £105 000 causes a marginal rate of 61%, so a bit of a high tax zone before going back to 41% at £125 000.
It does affect behaviour. Some of my colleagues have cited this as well as the annual allowance rules as a reason to cut hours.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
It's so cheap to fix as well, could be revenue neutral if they did what I suggested. It would actually be a huge revenue driver IMO. Our bean counter said it's one of the few areas where the rate cut will definitely generate more than it costs to implement as it will lead to behavioural changes almost overnight as people go back to full time work or junk their AVCs.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
If Trussnomics collapses in a Sterling crisis and Barberesque boom, the current regime would not be replaced with another tax cutting ideologue like Badenoch.
Wallace is the dullard on which people project their hopes.
It may be the second coming of Johnson, or perhaps the revenge of Sunak, who did rather better in the members poll than expected.
Yes, I was thinking Sunak might have a chance in the event of an early Truss crash.
Except that, if Truss crashes, her successor really is taking over as a placeholder before the Conservatives lose big in late 2024.
That requires a curious mixture of attributes, because it won't be fun at all. Who has the stoicism to pull that off with dignity and get past the nutters in the party?
St Theresa. People talking about a previous PM coming back have been looking at the wrong target. Its astonishing how fast the Maybot's reputation has been rebuilt from her "ahem" position on the back benches.
No, she’s enjoying ‘I told you so’ from the backbenches way too much, and making a very good living. She’s not going to put herself through that again.
Oh I dunno. Begged to return by her MPs to save the party? How much smoke is it possible to have blown up your arse before you get a happy?
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Have you thought about part funding with 0% spend credit cards and 0% balance transfer cards with zero transfer fee. I think we discussed this a few years ago. When I had a mortgage I funded 100k of the loan this way. Need to be sure you can pay off or transfer the balance before the interest rates kick in but you normally get 2 years to plan that. I have done a lot less now I don't have a mortgage and interest rates have been low, but I still have £30k, not due to be paid of for 2 years which I invest.
Thanks, that sounds sophisticated. But I will look into it.
I'm building a financial model tonight to model various risk scenarios over the next 5-10 years. Will help me decide what's best for my family.
My most viable plan is to bring forward my retirement and use the lump sum to pay off my residual mortgage, which is a 0.5% over base rate tracker for the life of the mortgage. I have kept it as an interest free loan over the last decade, but those days are going.
I would then return to work part time for another decade or so.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
They are also propped up by unusually high second hand values at present. Those are not likely to be sustained.
Some manufacturers (eg McLaren) underwrite a guaranteed residual value to the lease company so the lease payment doesn't even have to reflect the actual resale potential.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Honestly if you can afford to pay the penalty it might be something to look into, our forecast for interest rates next December was increased for 4.5% to 5.75% which implies mortgage rates in excess of 7%.
The Bank of England would have dropped another ball (if they had any left to drop) by only increasing base rates by 0.5%. I think that had more effect on the price of Sterling than the budget and, of course, that has inflationary effects too. The incompetence of the present governor is a problem that the government is going to have to address. He's a liability.
Come off it. The charts suggest the opposite. The interest rate announcement was a blip. The 'budget' was a proper fall in the value of sterling. Not conclusive proof but suggesting anything else is just your own hunches.
The politics of allowing the energy cap to be overshadowed by tax cuts for the highest earners is mind-bogglingly bad - especially given the cap has diminishing political capital anyway as it prevents bigger bills so generally won’t make people feel better off.
Only those earning over £155k are actually seeing real tax cuts.
But this is interesting, it's quite different from the narrative out there on social media. It's not so much the poor losing out, as above-average earners paying for COVID lockdown largesse.
Yes, it was interesting seeing this from the IFS. On the one hand not as regressive as the headline tax changes because the fiscal drag effect was progressive, but on the other hand, politically: hitting the middle class to benefit the very rich is electorally brave.
The politically most astute tax measure would have been raising the higher rate band to 80k as had been rumoured. That would have set Labour a trap. A lot of swing voters at the 50-60k level who wouldn’t have taken kindly to being described as rich.
Raising the higher rate band to maybe £70k, would be a great offer for the pre-election budget. In the meantime, as others have noted, the fiscal drag is helping with revenues as more people move into the 40% rate at a time of inflation.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Yes, it's very odd, and I'll own up to having voted for it without thinknig the consequences through - but Governments have had over a decade to work it out. From any point of view - right-wing, left-wing, whatever, a marginal tax rate of 61% in a particular band of income when people on higher income have a lower rate is just peculiar.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
No it's a dreadful indictment on those setting the odds. They have no idea about the Conservative Party. No way on earth is Boris coming back.
Wallace way too short. Once Truss goes, it is very likely Wallace is persuaded to become PM in a coronation.
Oh come off it MM that's wishful thinking, it's Johnson, and he will likely as not win a honeymoon election.
I just hope and pray Liz hasn't emulsioned over the Lulu Lytle.
Funny how people in other parties love telling me what the Conservatives will do.
One thing that won't happen if Truss goes is a membership vote. It will be a coup. Change in 24 hours.
Oh, and Kwarteng on 19s? LOL. If Truss goes, Kwarteng goes as the architect of the fiscal policy that caused her downfall. Unless of course it is massively successful - and he is her anointed successor about 9 years down the line. But I'd be wanting more than 19s to tie up money on that outcome!
Wallace is the value in that field.
If Wallace wanted to be leader, he would’ve stood last time. If he doesn’t want to be leader, he’s not a good bet to be leader!
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
They're not even rolling all of them, they've cherrypicked the ones that help their case. To include the frozen tax threshold change but not include the rise in NI threshold change is odd.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Only if inflation is zero so they are not affected by fiscal drag.
Yep - this is the key point: only the very wealthy are going to feel better off as a result of this budget. Inflation means everyone else gets a further cost of living squeeze. The energy cap is necessary but soon gets baked in because it stops something that was going to happen from happening, it does not actually make current life any easier.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
They are also propped up by unusually high second hand values at present. Those are not likely to be sustained.
Some manufacturers (eg McLaren) underwrite a guaranteed residual value to the lease company so the lease payment doesn't even have to reflect the actual resale potential.
Not sure exactly how it works under the hood but my deal I just agreed has a guaranteed residual that I think is probably underwritten by Santander. The residuals are already starting to slip, my PCP went up by a tenner because of it from when I ordered the car to when I signed the papers. If I got to the end of the lease and there was no equity I’d be happy to hand it back if I wanted something else or refinance if I wanted to keep it.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
They are also propped up by unusually high second hand values at present. Those are not likely to be sustained.
My new company Tesla is on a BCP. The interest rate isn't great. But - and its a very big but - its ludicrously tax efficient, both switching my car costs from post-tax to pre-tax and wiping out my Corporation Tax bill(s).
Tesla used values remain bonkers, and as long as they remain leading edge I don't see a massive u-turn in that.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
They're not even rolling all of them, they've cherrypicked the ones that help their case. To include the frozen tax threshold change but not include the rise in NI threshold change is odd.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Yes, it's very odd, and I'll own up to having voted for it without thinknig the consequences through - but Governments have had over a decade to work it out. From any point of view - right-wing, left-wing, whatever, a marginal tax rate of 61% in a particular band of income when people on higher income have a lower rate is just peculiar.
There's still the effective 55% rate on earnings for the very poorest on UC too, of course.
The Chancellor’s huge package of personal tax cuts will disproportionately benefit London and the South East – with households in these regions standing to gain to three times as much on average (£1,600) as those living in Wales, the North East and Yorkshire (£500) next year. https://twitter.com/resfoundation/status/1573570479016878086/photo/1
Well Truss and Kwarteng might at least have shored up the bluewall even if it does little for the redwall
Do have to boggle at little at the rivers of diarrhoea which makes up post-Brexit Tory politics. We've just finished summer 22. The Brexit vote was summer 16. In the 6 years since we have had 2 elections, 4 Prime Ministers, 6 Chancellors. We get a new PM and get told its a "new government" as if there is no continuity with the previous.
Whats more, look at the economic policies. The "fuck the poor" policies of Kamikaze are a million miles from "we're all in this together" of Osborne. And yet it is the same party. With an evolution of the same politicians. Supposedly with a mandate from voters which is consistent and cumulative.
But is the Tory government of late summer 2022 remotely the same as the Tory government of early summer 2016?
The more interesting question is whether the Tory government of late summer 2022 will be remotely the same as the Tory government of early summer 2023....
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Have you thought about part funding with 0% spend credit cards and 0% balance transfer cards with zero transfer fee. I think we discussed this a few years ago. When I had a mortgage I funded 100k of the loan this way. Need to be sure you can pay off or transfer the balance before the interest rates kick in but you normally get 2 years to plan that. I have done a lot less now I don't have a mortgage and interest rates have been low, but I still have £30k, not due to be paid of for 2 years which I invest.
Thanks, that sounds sophisticated. But I will look into it.
I'm building a financial model tonight to model various risk scenarios over the next 5-10 years. Will help me decide what's best for my family.
Not really sophisticated, but takes some management and time to build up. Happy to talk off line. Just mustn't miss the deadlines for paying off or transferring as otherwise interest is punitive. It is free money. Just exploiting the credit card companies who are trying to exploit you.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
They're not even rolling all of them, they've cherrypicked the ones that help their case. To include the frozen tax threshold change but not include the rise in NI threshold change is odd.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
The only people defending it here appear to be extremist libertarians, tax exiles and the odd ultra-partisans. Everyone else making up the arc of the political spectrum thinks it’s potty.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Car PCPs are great when interest rates are at zero. Put rates up to 3-4%, and they start getting really expensive really quickly. Loads of people are going to re-finance their existing car when the PCP runs out, rather than trade in at an expensive price.
They are also propped up by unusually high second hand values at present. Those are not likely to be sustained.
Our car is on a PCP. It's a year old. We were 'phoned yesterday by the salesman from the local dealers "this is just a courtesy call! "I said that we were not in the market for a new car at the moment my physical ability being what it is and we're unlikely to be for a while. He seemed quite disappointed, before politely sympathetic!
And Good Morning one and all; bright and cheerful here, although it's not as warm as it has been.
In other news I see the Guardian's University advice is now that St Andrews, Oxford and Cambridge are on a level. Is that because of the improved status of a couple of graduates from St. A?
I suspect that all the discussion of tax changes misses the key point. Forget the rich, for a moment.
What matters to people on below average or average incomes is how much disposable income they have once all their essential bills are paid, regardless of the precise amount of tax/NI they pay. Given the freezing of tax thresholds, the huge rise in energy bills (despite the cap), the fact that most pay rises are below inflation, and all the price rises to 'essential' goods, the vast majority of people are going to be worse off - i.e. have less disposable income. Cutting the basic rate to 19% will only have a marginal impact on that fact.
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
No it's a dreadful indictment on those setting the odds. They have no idea about the Conservative Party. No way on earth is Boris coming back.
Wallace way too short. Once Truss goes, it is very likely Wallace is persuaded to become PM in a coronation.
Oh come off it MM that's wishful thinking, it's Johnson, and he will likely as not win a honeymoon election.
I just hope and pray Liz hasn't emulsioned over the Lulu Lytle.
Funny how people in other parties love telling me what the Conservatives will do.
One thing that won't happen if Truss goes is a membership vote. It will be a coup. Change in 24 hours.
Oh, and Kwarteng on 19s? LOL. If Truss goes, Kwarteng goes as the architect of the fiscal policy that caused her downfall. Unless of course it is massively successful - and he is her anointed successor about 9 years down the line. But I'd be wanting more than 19s to tie up money on that outcome!
Wallace is the value in that field.
If Wallace wanted to be leader, he would’ve stood last time. If he doesn’t want to be leader, he’s not a good bet to be leader!
Laying Wallace was a big help in the previous leadership election
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Yes, it's very odd, and I'll own up to having voted for it without thinknig the consequences through - but Governments have had over a decade to work it out. From any point of view - right-wing, left-wing, whatever, a marginal tax rate of 61% in a particular band of income when people on higher income have a lower rate is just peculiar.
There's still the effective 55% rate on earnings for the very poorest on UC too, of course.
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
I suspect that all the discussion of tax changes misses the key point. Forget the rich, for a moment.
What matters to people on below average or average incomes is how much disposable income they have once all their essential bills are paid, regardless of the precise amount of tax/NI they pay. Given the freezing of tax thresholds, the huge rise in energy bills (despite the cap), the fact that most pay rises are below inflation, and all the price rises to 'essential' goods, the vast majority of people are going to be worse off - i.e. have less disposable income. Cutting the basic rate to 19% will only have a marginal impact on that fact.
Exactly. And they also rely on public services that they can see are fraying at the seams.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Yes, it's very odd, and I'll own up to having voted for it without thinknig the consequences through - but Governments have had over a decade to work it out. From any point of view - right-wing, left-wing, whatever, a marginal tax rate of 61% in a particular band of income when people on higher income have a lower rate is just peculiar.
There's still the effective 55% rate on earnings for the very poorest on UC too, of course.
Interesting polling thread on peoples preferred tax rates across thresholds.
It's stupid. I have to dump it all into AVCs, even though I really need it as salary, and a pay increase causes more problems than it's worth.
Yes, it's very odd, and I'll own up to having voted for it without thinknig the consequences through - but Governments have had over a decade to work it out. From any point of view - right-wing, left-wing, whatever, a marginal tax rate of 61% in a particular band of income when people on higher income have a lower rate is just peculiar.
There's still the effective 55% rate on earnings for the very poorest on UC too, of course.
Very. Little can be done to fix that though without either explicitly giving people some of it or dragging a lot of better paid workers into UC so the taper percentage can be reduced.
Only those earning over £155k are actually seeing real tax cuts.
So pretty much everyone earning over minimum wage, sees yesterday’s announcements reduce their tax bill compared to the previous status quo.
Yeah - I think the IFS are being misleading for lefty social media clout. They are rolling all the post-Covid measures into the assessment of the minibudget.
They're not even rolling all of them, they've cherrypicked the ones that help their case. To include the frozen tax threshold change but not include the rise in NI threshold change is odd.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
Do have to boggle at little at the rivers of diarrhoea which makes up post-Brexit Tory politics. We've just finished summer 22. The Brexit vote was summer 16. In the 6 years since we have had 2 elections, 4 Prime Ministers, 6 Chancellors. We get a new PM and get told its a "new government" as if there is no continuity with the previous.
Whats more, look at the economic policies. The "fuck the poor" policies of Kamikaze are a million miles from "we're all in this together" of Osborne. And yet it is the same party. With an evolution of the same politicians. Supposedly with a mandate from voters which is consistent and cumulative.
But is the Tory government of late summer 2022 remotely the same as the Tory government of early summer 2016?
Whilst I understand the sentiments and share them to some extent, you are forgetting that the country had a chance to get rid of this set of MPs and Ministers in 2019 and, with some measure of vigour, chose not to do so. Indeed, compared to the previous 2 decades of elections, they thoroughly endorsed them. So, the mandate is not consistent and cumulative from Cameron's era, it is a completely new mandate and by some measures a more emphatic one than Cameron ever enjoyed.
Do the Conservatives have a plan to balance the books? 5 years? 10 years? My fear is that this will prove such a shambles that we'll just go back to penny pinching Treasury orthodoxy.
It's amazing that Alistair Darling's plan to halve the deficit over 5 years was 'not good enough' but a massive giveaway without any clear plan to bring things back into balance is okay. The markets suggest otherwise.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
Indeed.
The politics of rocking up to the school gates in an 06 Zafira when a 22 plate Evoque was previously your ride of choice won't have many incumbent votes in it.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
The budget didn’t mention mortgage costs (I assume you mean changes in interest rates, set by the independent BoE), and inflation has a whole number of causes.
As I said, terrible journalism, most people will be better off *as a result of the changes in taxation announced yesterday* by the Chancellor.
But the drop in sterling is because of the tax changes. Even if interest rates don't go up the drop in sterling adds ~4% onto commodity prices which sends consumer prices up by 2-3%, that alone wipes out any tax cuts for all but the top 10% of earners. Add in interest rates going up and now you're in a situation where 99% of people are worse off.
As one of my colleagues pointed out yesterday, it's not necessarily the government borrowing an additional £45bn that has spooked markets, it is that the City and Wall Street don't understand why the money has been spent on measures that have low or negative economic multipliers. Giving already rich people a big tax cut won't yield anywhere near the additional growth we need to balance this off. As evidenced in the NEISR forecast yesterday.
As you know I'm generally more positive on the UK than most on here and was willing to be convinced by the need to stimulate growth with targeted tax cuts. Well now that we've got the tax cuts I don't see how they stimulate growth in the long term.
I share your perplexity. A lot of that £45bn is going to be saved with zero multplier effects. I think the intention must be to attract new high earners to the City or elsewhere by reducing their personal taxation and their corporate taxation if they base their business here as well as removing the rather silly restrictions on bonuses. It's possible that will happen to a small extent but not on a scale that will make a difference.
The infrastructure and investment zones are potentially interesting. If this succeeds in attracting new businesses to depressed areas it could do a lot for levelling up and the red wall seats. The benefits include no rates and no stamp duty along with pretty much no planning controls. But the devil may be in the detail of the last one which seems to need to be agreed with local authorities.
Junking the bonus cap would have been enough to retain and get new higher earners in the city. No need for the additional rate cut. As I pointed out last night the £100k cliff edges for childcare and allowance withdrawal are more damaging than the additional rate. One of our bean counters suggested yesterday that removing these would cost £2.5bn but generate an additional £10-12bn in economic activity as high earners take on more work without worrying about having to fund childcare out of pocket and the idiotic 60% marginal rate.
I think my suggestion from yesterday would have been best, remove the cliff edges and bring the additional rate down to 43% and start it at £100k. That way works for everyone and eliminates the odd disincentives to work. Right now we're dealing with this situation at work, one of my staff is now moving down to 4 days per week because she can't afford the pay rise that would lose her the government funded childcare. It's completely mad.
Kwarteng went for the headline of ‘I’ve abolished the top rate’ instead. He’s supposed to be smart, but that decision shows he’s deeply unserious.
I imagine Kwazi sees 150k or so as not being that high paid and therefore thinks he’s offering support to the middle class.
Well, 2 or 3 years of serious inflation and 150k will be minimum wage!
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
It’s not that it hits hard at £100k, it’s the fact they did something at £150,000 without grasping that with a little piece of thinking they could help way more well paid people
My observations. Commentary is partisan, but the partisans for are struggling with their rationales. Saying "Kwarteng takes a gamble" without saying what the gamble aims to achieve is not a ringing endorsement. Similarly Kwarteng tells us to "look at the bigger picture" without actually setting out that bigger picture.
Everyone keeps saying Kwarteng is hugely brainy. I have never seen any sign of it. He seems somewhat stupid.
Do the Conservatives have a plan to balance the books? 5 years? 10 years? My fear is that this will prove such a shambles that we'll just go back to penny pinching Treasury orthodoxy.
It's amazing that Alistair Darling's plan to halve the deficit over 5 years was 'not good enough' but a massive giveaway without any clear plan to bring things back into balance is okay. The markets suggest otherwise.
Did you not see the forecast. At no point do we end up with a balanced budget with these plans borrowing is required for ever.
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
It’s not that it hits hard at £100k, it’s the fact they did something at £150,000 without grasping that with a little piece of thinking they could help way more well paid people
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
It’s not that it hits hard at £100k, it’s the fact they did something at £150,000 without grasping that with a little piece of thinking they could help way more well paid people
It's ideology I suspect. Far more important to get the highest rate of tax down from 45% to 40% than give a personal allowance to those who don't need it.
You could of course extend the taper over which the personal allowance is reduced. This would also likely reduce end of year underpayments.
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
I get your attitude to this but it is, unfortunately, a fact of life. And it is not, generally, PB posters saying they are disincentivized, but pointing out that this is having a serious effect on public services, most particularly the NHS.
Combined with the pension tax regime for long servers, the current tax arrangements are a serious drain on expertise and headcount amongst the people we rely most upon to keep the NHS (as an example) running. You may question their public duty if you like but they are making a calculation that most people make at all levels of life, particularly as they approach retirement age. Is it worth me carrying on doing this or, if I can afford it, am I just better off packing it in and doing something else?
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
Rather they’re pointing out that for a particular band of earners, there’s literally no point in increasing your earnings at the margin. No one’s asking us to feel sorry for them; they’re just complaining, rightly, about the economic inefficiency.
Kwarteng could have fixed that instead of going for the headline rate cut. Might have meant fewer doctors working part time, too.
None of it effects me, but I’m happy to acknowledge the point.
Do the Conservatives have a plan to balance the books? 5 years? 10 years? My fear is that this will prove such a shambles that we'll just go back to penny pinching Treasury orthodoxy.
It's amazing that Alistair Darling's plan to halve the deficit over 5 years was 'not good enough' but a massive giveaway without any clear plan to bring things back into balance is okay. The markets suggest otherwise.
Did you not see the forecast. At no point do we end up with a balanced budget with these plans borrowing is required for ever.
Balancing the books may not be he right phrase. But borrowing below 2% of GDP?
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Move quick I suspect that offer won’t be there by the end of next week if not sooner.
I’m utterly shocked that I got a car loan on Tuesday at 2.8% Apr - somehow doubt that’s available today…
New automotive retail is in for a near term spanking.
Should say it was a separate loan as Mrs Eek does 25,000 miles a year so i buy second hand to destroy… the plan was an MG4 but the suitable version arrives next March and the current car won’t last that long.
It won’t just be new automotive that goes. Most people buy based on monthly cost and that’s going to increase rapidly as interest rates and risk go up..
Automotive loans and PCP are the new sub-prime. There are an awful lot of new Audis outside the social housing near me. Either that or the drug pushing business is booming.
PCP are weird though. The level is based on the difference between the value now and the value when it’s returned, which means that posh brands often end up being way cheaper than Vauxhall / ford are even when the initial retail price is lower.
BMW Finance recently sent me an offer for an 840i M Sport Gran Coupe on a 9+35 lease for £770/month. That car lists at well over 80 grand new with the options. I have no idea how anybody involved is making any money.
The divisions of the Tory leadership campaign roared back to the fore… with critics claiming the chancellor was trying to avoid scrutiny by refusing to publish economic forecasts from the independent budget regulator.
… compared by one senior party figure to the ill-fated “Barber budget” of 1972, which emulated a similar aim but ended in boom, soaring inflation and ultimately the demise of Ted Heath’s premiership.
“I’ve never known a government that has had so little support from its own backbenches, just four sitting days in,” observed one MP.
“I completely despair, because I’m a member of a party that stands up for the squeezed middle not the very rich. This will be politically toxic and economically dubious,” said another MP present for the statement.
… “It’s the richest we’re helping while the poorest are suffering the most,” was one northern MP’s stark assessment.
“Everybody is distraught at the reshuffle and the way it’s been handled,” said one person recently ousted from the government. “Looking ahead, you’re going to have a situation where, unless some goodwill is extended, people will look for a cause to lay a marker down to make clear their unhappiness.”
Sunak’s supporters said they were more likely to boycott the Conservative party conference and ruminate over WhatsApp with other frustrated colleagues over the following few weeks of recess.
Ex coalition leader, orange book, Ed Davey is perfectly positioned to offer something to sound money Cameron era Tories
They have a huge opportunity, but are they still too weak to grab it?
Yes.
Any more easy questions?
Wait for the results of the local elections next May. Equally there are several likely by-elections which also tend to boost the Lib Dems visibility. I think Lib Dem polling numbers next year will be well above today´s levels. Ed Davey has done a lot of work on the party structure and he has already done better in by elections and locals than even the current polling levels would suggest.
The point is that the Tories cannot get rid of Truss now without a major breakdown in the party itself. As the nation makes up its mind to ditch the Conservatives at the next General Election, a change in leader would only increase the impression of chaos and division and increase the scale of the defeat.
Keeping Truss until the inevitable debacle at least would allow the Tories a viable scapegoat for blame and the new leader can then lick wounds and lead the party in a new direction. Of course if there was, for example, a reckless candidate with a massive ego who was prepared to seize the leadership and rock the Tory boat... well then we could see a Canada style wipe-out.
Personally I am sure than none of us thinks that such a reckless and dishonorable chancer could possibly emerge from the current crop of front bench and former front bench Conservatives. Perish the thought.
My observations. Commentary is partisan, but the partisans for are struggling with their rationales. Saying "Kwarteng takes a gamble" without saying what the gamble aims to achieve is not a ringing endorsement. Similarly Kwarteng tells us to "look at the bigger picture" without actually setting out that bigger picture.
Everyone keeps saying Kwarteng is hugely brainy. I have never seen any sign of it. He seems somewhat stupid.
It is a tall order for such changes to magic up growth on the scale needed, particularly in a world where other countries are also in recession, but not pursuing such policies.
While British markets plunged yesterday, they did elsewhere too, and shares like miners that earn overseas were amongst the biggest droppers.
The worldwide economic situation looks pretty grim.
Europe and UK affected by the Russian war, and ravaged by energy costs. China struggling with Covid and the real estate crunch.
America however may be through the worst, with inflation seeming to have peaked there, and relatively unaffected by either war or covid. Probably the best place to invest again.
Biden may well get the electoral credit, deserved or undeserved.
Do have to boggle at little at the rivers of diarrhoea which makes up post-Brexit Tory politics. We've just finished summer 22. The Brexit vote was summer 16. In the 6 years since we have had 2 elections, 4 Prime Ministers, 6 Chancellors. We get a new PM and get told its a "new government" as if there is no continuity with the previous.
Whats more, look at the economic policies. The "fuck the poor" policies of Kamikaze are a million miles from "we're all in this together" of Osborne. And yet it is the same party. With an evolution of the same politicians. Supposedly with a mandate from voters which is consistent and cumulative.
But is the Tory government of late summer 2022 remotely the same as the Tory government of early summer 2016?
Whilst I understand the sentiments and share them to some extent, you are forgetting that the country had a chance to get rid of this set of MPs and Ministers in 2019 and, with some measure of vigour, chose not to do so. Indeed, compared to the previous 2 decades of elections, they thoroughly endorsed them. So, the mandate is not consistent and cumulative from Cameron's era, it is a completely new mandate and by some measures a more emphatic one than Cameron ever enjoyed.
True. But we have Tory MPs now saying "ignore everything we said over the last 12 years". They can't realistically claim that every time they have another change of boss that its a "new government". People aren't that stupid.
Even the mandate of 2019 is a long way from yesterday's special economic operation.
https://twitter.com/RSPBEngland/status/1573366815568580613 Make no mistake, we are angry. This Government has today launched an attack on nature. We don’t use the words that follow lightly. We are entering uncharted territory. Please read this thread.…
The simple fact, cutting through all of the details is this. Will most people have more or less disposable income in the round than last year? The answer to that appears to still be less. Therefore. There is little prospect of growth. No matter how much it is asserted.
Tempting to junk my existing mortgage deal with the EPR penalty and fix with Barclays for 7 years at 3.49%
Honestly if you can afford to pay the penalty it might be something to look into, our forecast for interest rates next December was increased for 4.5% to 5.75% which implies mortgage rates in excess of 7%.
The Bank of England would have dropped another ball (if they had any left to drop) by only increasing base rates by 0.5%. I think that had more effect on the price of Sterling than the budget and, of course, that has inflationary effects too. The incompetence of the present governor is a problem that the government is going to have to address. He's a liability.
I wouldn't trust Truss to replace the BoE governor with someone determined to stop inflation. Indeed more likely someone willing to let it rip.
He was also a supporter of Brexit which makes him suspect if not downright incompetent. How we know this of a man in a grey suit is also an interesting question. After all isn't anonymity the point of the grey suit?
Think of it as a chance to relive the glory years of Blair when the top rate of tax was 40%.
Why don’t you actually address what I’m saying?
If you want to win the next election you need to win over people that have now swapped to Labour. About 10% of them. How does this budget bring them back? In fact I’d say it tells them not to come back.
And it loses the Red Wall as it is not what they voted for.
Your responses seem to entirely be ignoring it and instead telling me how bad Blair was in multiple ways. He hasn’t been the PM since 2007.
As a general view on life, I think nothing is ever as bad or as good as it seems.
Certainly this budget has been received very badly (even by those like me who come away about £2000 pa better off in the short term) but the fiscal drag from inflation will actually mean that we remain a high tax country, so the deficit will not be as bad as projected. I don't expect any detectable effect on growth as nothing has been done to address the reasons for our poor growth in recent decades.
Today are leading with a think tank opinion, everyone but very rich WORSE OFF after a £45B giveaway budget.
Really?
Journalism at its best. Every one who pays income tax or NI, is better off as a result of the measures announced yesterday.
Not really, this budget will add hundreds of pounds per month onto mortgage costs and extend our period of high inflation by an extra 6 months. The small saving on NI will be wiped out by these twin costs. Only people earning £250k or more will actually be better off IMO.
Not 100% accurate.
Come April the same choice for most people will be to take a contract rather than a permanent job and pay themselves using a limited company.
For people doing that earn £50,000 it would reduce NI costs to zero and after tax give you a take home pay of £40,080 after all tax was deducted.
An interesting point. I have been working with the same group of Romanian companies for 2 years, developing and trying to implement UK business plans for their expansion. After a couple of false starts (driven by changes at their end, not mine!) we are finally about to get on with it with scale in the UK.
Previously I had been clear that once we start trading properly and hiring people, my contractor status would become untenable and I would need to be employed by the new UK business to run it. Is that still true?
Let me post a flow diagram I did for LinkedIn yesterday. the response so far has been cynical it accurate and that includes people who I know work in Longbenton
Although you will have a slight different issue as an office holder but even then I suspect you could separate things out.
In many ways the biggest changes yesterday were completely hidden - there is this one on tax and a different one of Thursday where all EU based employment law was quietly dropped from January 1st 2024 unless explicitly relegislated.
Should that be "contract" in the top box? In several decades of IT work, I've seen one genuine contractor, brought in repeatedly but for specific projects, and rather more disguised employees, and quite a few with 12 to 18-months contracts where maybe both sides were taking the piss. Btw, some companies use almost an internal contractor model, where employees are assigned to teams or projects for short periods and then moved back to the "bench" which I guess is some sort of American sports metaphor.
As a general view on life, I think nothing is ever as bad or as good as it seems.
Certainly this budget has been received very badly (even by those like me who come away about £2000 pa better off in the short term) but the fiscal drag from inflation will actually mean that we remain a high tax country, so the deficit will not be as bad as projected. I don't expect any detectable effect on growth as nothing has been done to address the reasons for our poor growth in recent decades.
Could this be the first budget in recent history which ravels rather than unravels?
Starmer 1.83 Johnson 15 Badenoch 17 Kwarteng 19 Wallace 21 25 bar
The Oaf being in 2nd spot is a dreadful indictment on the Conservative Party. They have run out of fuel.
If Trussnomics collapses in a Sterling crisis and Barberesque boom, the current regime would not be replaced with another tax cutting ideologue like Badenoch.
Wallace is the dullard on which people project their hopes.
It may be the second coming of Johnson, or perhaps the revenge of Sunak, who did rather better in the members poll than expected.
Yes, I was thinking Sunak might have a chance in the event of an early Truss crash.
Except that, if Truss crashes, her successor really is taking over as a placeholder before the Conservatives lose big in late 2024.
That requires a curious mixture of attributes, because it won't be fun at all. Who has the stoicism to pull that off with dignity and get past the nutters in the party?
St Theresa. People talking about a previous PM coming back have been looking at the wrong target. Its astonishing how fast the Maybot's reputation has been rebuilt from her "ahem" position on the back benches.
No, she’s enjoying ‘I told you so’ from the backbenches way too much, and making a very good living. She’s not going to put herself through that again.
I'm not sure. Sfaict, Theresa May has a strong public service ethic and might easily be persuaded it is her civic duty to resume the reins.
Interesting read here on PB this morning as people complain about how the Chancellor's tax cuts disincentivize them to work further because it hits hard when you are on £100K....
Rather they’re pointing out that for a particular band of earners, there’s literally no point in increasing your earnings at the margin. No one’s asking us to feel sorry for them; they’re just complaining, rightly, about the economic inefficiency.
Kwarteng could have fixed that instead of going for the headline rate cut. Might have meant fewer doctors working part time, too.
None of it effects me, but I’m happy to acknowledge the point.
I'm trying to get my head around people on £100,000 getting help with childcare.
Think of it as a chance to relive the glory years of Blair when the top rate of tax was 40%.
Why don’t you actually address what I’m saying?
If you want to win the next election you need to win over people that have now swapped to Labour. About 10% of them. How does this budget bring them back? In fact I’d say it tells them not to come back.
And it loses the Red Wall as it is not what they voted for.
Your responses seem to entirely be ignoring it and instead telling me how bad Blair was in multiple ways. He hasn’t been the PM since 2007.
Sounds like you should be delighted with this budget. Labour should cruise to victory next time.
Comments
The politically most astute tax measure would have been raising the higher rate band to 80k as had been rumoured. That would have set Labour a trap. A lot of swing voters at the 50-60k level who wouldn’t have taken kindly to being described as rich.
Increase in tax as a % of earnings is 1.2% at £120k.
Isn't he a mate of @rcs1000 and he said he was sensible?
Sorry I realise now it's a comparison with the pre-budget position.
Whats more, look at the economic policies. The "fuck the poor" policies of Kamikaze are a million miles from "we're all in this together" of Osborne. And yet it is the same party. With an evolution of the same politicians. Supposedly with a mandate from voters which is consistent and cumulative.
But is the Tory government of late summer 2022 remotely the same as the Tory government of early summer 2016?
I'm building a financial model tonight to model various risk scenarios over the next 5-10 years. Will help me decide what's best for my family.
I remember a US GOP politician being ridiculed a few years ago - was it Romney? - for suggesting the middle class was anything up to $250k.
ALWAYS BE CAREFUL WHAT YOU WISH FOR. THE CONSEQUENCES ARE NOT ALWAYS FORSEEABLE.
Yesterday's announcements should be judged on their own merits, but that wouldn't get lefty clickbait. The IFS are selling their integrity for retweets.
Yes he will crash and burn your party and the nation in Government (again) which is why you (and I) want Wallace next time. Then just imagine the drear-fest Wallace v Starmer would generate.
Boris is your boy!
But if the Party comes crawling on its knees to him? Who could refuse that call?
I would then return to work part time for another decade or so.
https://interactive.guim.co.uk/uploader/embed/2022/09/income-groups-tax-cuts/giv-6562wbNhPgRo8Paa/Income-groups-tax-cuts-inArticle_620.png
Tesla used values remain bonkers, and as long as they remain leading edge I don't see a massive u-turn in that.
Those who pay more in tax benefit most from cuts, because they're the ones who actually pay tax. Its the ten men drinking beer story.
And Good Morning one and all; bright and cheerful here, although it's not as warm as it has been.
In other news I see the Guardian's University advice is now that St Andrews, Oxford and Cambridge are on a level. Is that because of the improved status of a couple of graduates from St. A?
What matters to people on below average or average incomes is how much disposable income they have once all their essential bills are paid, regardless of the precise amount of tax/NI they pay. Given the freezing of tax thresholds, the huge rise in energy bills (despite the cap), the fact that most pay rises are below inflation, and all the price rises to 'essential' goods, the vast majority of people are going to be worse off - i.e. have less disposable income. Cutting the basic rate to 19% will only have a marginal impact on that fact.
https://twitter.com/benwansell/status/1573283873026412545?t=WwPv4gyGuOUhQHXqsfNQmw&s=09
https://www.formula1.com/en/latest/article.williams-announce-they-will-part-ways-with-latifi-at-the-end-of-2022.2sCmC3LBpGoSuEGDyHe6RH.html
Too slow, alas. And spins a bit too often.
It's amazing that Alistair Darling's plan to halve the deficit over 5 years was 'not good enough' but a massive giveaway without any clear plan to bring things back into balance is okay. The markets suggest otherwise.
https://twitter.com/Reevellp/status/1573272879655010306?t=RzYtFZvmfSVGuIi4n2iloQ&s=19
They don't sound very keen.
The politics of rocking up to the school gates in an 06 Zafira when a 22 plate Evoque was previously your ride of choice won't have many incumbent votes in it.
Everyone keeps saying Kwarteng is hugely brainy. I have never seen any sign of it. He seems somewhat stupid.
You could of course extend the taper over which the personal allowance is reduced. This would also likely reduce end of year underpayments.
Combined with the pension tax regime for long servers, the current tax arrangements are a serious drain on expertise and headcount amongst the people we rely most upon to keep the NHS (as an example) running. You may question their public duty if you like but they are making a calculation that most people make at all levels of life, particularly as they approach retirement age. Is it worth me carrying on doing this or, if I can afford it, am I just better off packing it in and doing something else?
No one’s asking us to feel sorry for them; they’re just complaining, rightly, about the economic inefficiency.
Kwarteng could have fixed that instead of going for the headline rate cut.
Might have meant fewer doctors working part time, too.
None of it effects me, but I’m happy to acknowledge the point.
Winning midterm opinion polls doesn't mean jack shit.
The point is that the Tories cannot get rid of Truss now without a major breakdown in the party itself. As the nation makes up its mind to ditch the Conservatives at the next General Election, a change in leader would only increase the impression of chaos and division and increase the scale of the defeat.
Keeping Truss until the inevitable debacle at least would allow the Tories a viable scapegoat for blame and the new leader can then lick wounds and lead the party in a new direction. Of course if there was, for example, a reckless candidate with a massive ego who was prepared to seize the leadership and rock the Tory boat... well then we could see a Canada style wipe-out.
Personally I am sure than none of us thinks that such a reckless and dishonorable chancer could possibly emerge from the current crop of front bench and former front bench Conservatives. Perish the thought.
While British markets plunged yesterday, they did elsewhere too, and shares like miners that earn overseas were amongst the biggest droppers.
The worldwide economic situation looks pretty grim.
Europe and UK affected by the Russian war, and ravaged by energy costs. China struggling with Covid and the real estate crunch.
America however may be through the worst, with inflation seeming to have peaked there, and relatively unaffected by either war or covid. Probably the best place to invest again.
Biden may well get the electoral credit, deserved or undeserved.
Even the mandate of 2019 is a long way from yesterday's special economic operation.
https://twitter.com/RSPBEngland/status/1573366815568580613
Make no mistake, we are angry. This Government has today launched an attack on nature. We don’t use the words that follow lightly. We are entering uncharted territory. Please read this thread.…
Will most people have more or less disposable income in the round than last year?
The answer to that appears to still be less.
Therefore. There is little prospect of growth. No matter how much it is asserted.
If you want to win the next election you need to win over people that have now swapped to Labour. About 10% of them. How does this budget bring them back? In fact I’d say it tells them not to come back.
And it loses the Red Wall as it is not what they voted for.
Your responses seem to entirely be ignoring it and instead telling me how bad Blair was in multiple ways. He hasn’t been the PM since 2007.
Certainly this budget has been received very badly (even by those like me who come away about £2000 pa better off in the short term) but the fiscal drag from inflation will actually mean that we remain a high tax country, so the deficit will not be as bad as projected. I don't expect any detectable effect on growth as nothing has been done to address the reasons for our poor growth in recent decades.
How can you disagree with him?