... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
The self-isolation U-turn seems like ancient history now, in view of the sudden and unexpected drop in the infection rate. It seems that the most reckless prime minister in recent history is also the luckiest.
I reckon the problem for the government now is that the most plausible of the post hoc explanations is that it's related to schools breaking up. If the infection rate is driven by schools to that extent, it poses the question of what will happen when schools go back and we get towards the Autumn, and whether the decision not in general to vaccinate under-18s is wise.
"the most reckless prime minister in recent history"
Nah, Tony Blair was much more reckless wrt the Iraq invasion. That was an utterly unforced error. Johnson's had to deal with something utterly novel in political terms: there have been pandemics before, but we now have many more tools to try to tackle them, albeit some of those tools are rather immature and novel. I'd also say Brown's treatment of the economy that led to the crash was reckless and unforced.
I really don't envy anyone having to make decisions in this pandemic. There're too many people on all sides shouting that their way is better: even when those ways vary and oppose each other. The decisions also have to take into account other factors, such as education and the economy.
IMV throughout the epidemic there have been no 'good' answers: only ones in varying positions on the 'bad' scale.
Gordon Brown's "treatment of the economy" did not lead to the crash, which was caused by the global financial crisis. To believe otherwise, you'd need to credit Brown with successfully steering Britain around the GFC only to fall into a quite separate hole at the same time. Which oddly enough did happen a few years earlier, hence the hubris about abolishing boom and bust.
Yep. Brown headed up a government that was tired. They had a poor comms operation vs the Tories who were pin sharp. Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. Brown got the blame for an economic bubble which burst, yet the Tories wanted to inflate in higher to enable them to match spending "pound for pound" and "share in the proceeds of [even higher] growth"
How did they get away with it? Liam "There's no money left" Byrne. One unfunny attempt at a joke and the narrative was the Tories to rewrite which they did with devastating effect.
Well, it was true. What it really boils down to is that Brown's premiership was doomed from the start, due to Brown's own actions as Chancellor in taxing the hell out of everything to pay for Blair's programme, meaning when the crisis hit, Brown ran out of money much faster than he should have done.
Whilst I certainly adhere to that view the amount of money a Chancellor can find in an emergency is truly remarkable. We saw that in 2008 with the capital injections into banks but even that has been dwarfed by the £400bn spent on dealing with Covid to date. The truth is that the envelope was much bigger and more flexible than we thought. This is bad news for fiscal hawks. Every time they moan about the deficit going forwards people will point to the staggering sums that Rishi was able to spend and print without obvious adverse effects.
The extent to which that is only true because most (all?) other significant governments were doing similar is the counter to this. As with most of these things we will never know for sure as each scenario is different so the fiscal hawks will continue to be able to find arguments to back their position.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
To take it to an extreme, the government could (in theory) abolish income tax entirely and massively expand ENI to replace it. Or they could abolish ENI - and regular NI, for that matter - and increase income tax to compensate, including changing thresholds to ensure everyone's marginal rates stayed the same.
The point is that, since the two above cases would ultimately result in the same take-home pay for most employees (although the gross salaries would be very different), it doesn't make sense to "pretend" that a small amount of ENI is meaningfully a tax on employers, rather than what it actually is, which is a stealth income tax on employees.
In the same vein, the distinction between income tax and NI is pure spin designed to make people feel better about how much they're paying to the taxman out of their wages.
I really wanted to watch Drive To Survive with my young nephews, but there’s no PG version and my sister would have killed me for all the new language they’d have learned!
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
Yes, @Philip_Thompson is running a workers' cooperative. In practice, if Rishi were to grant, say, a month's holiday on employer's NI, the savings would go to the owners not to the workers.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
I have no problem with a debate about taxes on employment. I do have a problem with comparing the income of an employee with that of a pensioner where employer costs are suddenly counted as their income. They are not, the comparison was completely disingenuous.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
How the tax gets paid is irrelevant. When you apply for a job you are told the wages are 15k a year and on your p60 15k gross pay is what appears. What you dont get at interview is your wages are 16 thousand a year because eni etc. As far as the employee is concerned he is being paid 15k a year gross pay. We are comparing that against a pensioner getting 15k a year gross pay.
Employers NI will never get merged in for the simple reason is the effect for most employees it would just be whacking 14% on income tax and the company pocketing the savings. No government that did that would ever get reelected
Here is 600 pages of official US inquiry into the global financial crisis. Think of it as a latterday Warren Commission, the canonical truth, settled and accepted for all time (with the page that says "it was all bloody Gordon Brown's fault" mysteriously redacted, even though the American government would have a lot to gain from blaming someone else). https://www.govinfo.gov/content/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf
Timothy Geithner, US Treasury Secretary, was asked what the primary cause of the financial crash was and explicitly blamed financial regulation in London, as it lead to a race to the bottom in loosening regulation. Who was the person who changed London's financial regulation dramatically? Gordon Brown.
I realise that we've been having this argument for over a decade now, but the idea that Brown bears no responsibility will not wash with anyone who is objective. Brown took an axe to UK banking and finance regulation, and was warned about the risk he was taking, and the UK ended up right in it as a consequence.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
I have no problem with a debate about taxes on employment. I do have a problem with comparing the income of an employee with that of a pensioner where employer costs are suddenly counted as their income. They are not, the comparison was completely disingenuous.
Especially as the employment side of the costs will be identical for both the pensioner and the non pensioner (bar a small bit of employer pension contributions).
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
Yes, @Philip_Thompson is running a workers' cooperative. In practice, if Rishi were to grant, say, a month's holiday on employer's NI, the savings would go to the owners not to the workers.
That would depend upon the company with what they choose to do, but that's the same with any tax. If Rishi were to grant a month's holiday on VAT, the savings would go to the owners in many businesses and not see headline price cuts.
If VAT permanently changes, if duties permanently changes, if Employers NIC permanently changes, then that would result in changes to prices - which includes wages.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
That actually looks like £484 vs £1136 paid by the individual, depending on your views on what Employers NI corresponds to.
Employers NI is income tax, no real difference whatsoever. Employers account for it in their budgeting, if it wasn't there then they could afford higher wages.
Very true - all staff costs go into the budget.
However, you know fully well that you cannot compare the tax burden of a worker with a pensioner by adding their employer's costs onto the employee. Does the employee pay ENICs? No.
Yes they do. They pay for it in recuced wages as it comes out of their wage budget.
To claim otherwise is dishonesty, pure and simple.
Were Employer NI to be removed would wages automatically increase by 13.8% - appropriate allowance?
As we know that isn't the case that is the reason it will never happen.
Oh and believe me I know an awful lot about the difference between advertised wages and budgets, there are a fair number of tribunals covering that subject on their way.
Yes they would ultimately.
Not immediately as it takes time for tax changes to filter through the economy, they don't happen overnight. Even VAT or duty changes don't immediately and fully filter through due to the fact prices are sticky and people like to have round numbers etc but ultimately the taxes have to be paid one way or the other.
Ultimately isn't good enough when you are talking about people's wages - unless you legislate to make the change immediate - some people would be seeing an instant 13.8% pay cut.
That's what happens whenever taxes change, you can use that argument for any tax at all.
As I've long said I would propose merging all income related taxes and benefits into a single, clear rate. To do so would inevitably result in disruption to the market so it should be phased in and it's complicated, just like Universal Credit was but on steroids. But that doesn't change it from being the right thing to do.
Agree, but the problem with merging the tax and benefits system is that taxes are generally assessed on individuals but benefits are assessed on households. That is a tough circle to square.
Agreed 100%.
But again, it being tough does not mean its not the right thing to do.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
To take it to an extreme, the government could (in theory) abolish income tax entirely and massively expand ENI to replace it. Or they could abolish ENI - and regular NI, for that matter - and increase income tax to compensate, including changing thresholds to ensure everyone's marginal rates stayed the same.
The point is that, since the two above cases would ultimately result in the same take-home pay for most employees (although the gross salaries would be very different), it doesn't make sense to "pretend" that a small amount of ENI is meaningfully a tax on employers, rather than what it actually is, which is a stealth income tax on employees.
In the same vein, the distinction between income tax and NI is pure spin designed to make people feel better about how much they're paying to the taxman out of their wages.
But NI is different for self employed workers and not paid at all by pensioners who continue to work.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
To take it to an extreme, the government could (in theory) abolish income tax entirely and massively expand ENI to replace it. Or they could abolish ENI - and regular NI, for that matter - and increase income tax to compensate, including changing thresholds to ensure everyone's marginal rates stayed the same.
The point is that, since the two above cases would ultimately result in the same take-home pay for most employees (although the gross salaries would be very different), it doesn't make sense to "pretend" that a small amount of ENI is meaningfully a tax on employers, rather than what it actually is, which is a stealth income tax on employees.
In the same vein, the distinction between income tax and NI is pure spin designed to make people feel better about how much they're paying to the taxman out of their wages.
I agree it is a stealth tax. I am not sure I agree that it is effectively a stealth IT. I certainly agree that it is long past time that NI was integrated into IT so that it is paid by everyone, including pensioners, on all income, including dividends.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why wouldn't it be zero - there will be a lot of people with few other options where it would be perfectly possible for the employer to offer £0 on a take it or leave option as leaving isn't an option?
There are very few industries where the full £850 would be paid to the worker.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I don't think that is fair. The difference between these other costs and ENI is that these other costs are incurred in the operation of the business. The ENI is simply a tax on employment which does not benefit the enterprise at all unlike the costs of an office, computer, phone etc. Where I think Philip is overstating it is assuming that the cost of ENI would otherwise go to the employee as opposed to, say, profits.
Taxes on employment seem to me a very bad thing but they have proved irresistible to governments of all colours because it is a hidden tax that does not appear on the wage slip. Brown's pension grab was similar in that the consequences were hidden for several years. Generally speaking governments should look to simplify taxes, be honest about what they need to raise and raise that money by as broad a tax base as possible paying as little as required.
To take it to an extreme, the government could (in theory) abolish income tax entirely and massively expand ENI to replace it. Or they could abolish ENI - and regular NI, for that matter - and increase income tax to compensate, including changing thresholds to ensure everyone's marginal rates stayed the same.
The point is that, since the two above cases would ultimately result in the same take-home pay for most employees (although the gross salaries would be very different), it doesn't make sense to "pretend" that a small amount of ENI is meaningfully a tax on employers, rather than what it actually is, which is a stealth income tax on employees.
In the same vein, the distinction between income tax and NI is pure spin designed to make people feel better about how much they're paying to the taxman out of their wages.
But NI is different for self employed workers and not paid at all by pensioners who continue to work.
So what? There's no intrinsic reason why the Govt couldn't introduce new income tax breaks for both those groups that would mimic the current setup perfectly.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
For a start you cannot include employers NI because it doesn't come out of the employees 15k he earns. So thats 850 gone straight away. So what you are really saying is just make pensioners pay NI
Of course it comes from it. Where does it come from? Fairies? The ether?
If I have a budget of £15k to pay someone then I need to take NI into account or I lose money. So I have to reduce the salary to pay for the NI as it is coming from the same pot.
If you want another way to look at it: Pension £15k Tax £484 Take home pay £14,516
Total budget for wages £15000:
Wages £14253 Employers NI £747 Total wage budget £15000 Tax £335 Employers NI £562 Take home pay £13356
Because we were comparing someone earning 15k to a pensioner also on 15k. The employer ni is invisible to the employes his paypacket says he earns 15k and his tax deductions are 1136 from that. Your way would leave the pensioner 850 poorer a year than the one who has a headline wage of 15k
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
It's an indirect cost to employees but a direct cost on employment - is how I'd put it.
The other thing people don't seem to comment on is the percentage increase from triple lock is not the actual percentage pensioners actually get if they also have other pensions.
Using my earlier example and using 9k as state pension amount to simplify
If inflation grows at 5% tripping that as the percentage for triple lock.
5% on a 15k wage increases it 15.75 our pensioner on 9k state pension and 6k private gets now 9.45k state pension +6k private which comes out as an increase overall of 3%
I am not a defender of triple lock, merely pointing it out as a lot of people make it seem like its on total income not just state pension element
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
Yes, but apart from that little flaw they were doing an excellent job protecting the banks cartel by massively increasing the costs of entry beyond the reach of all but the deepest pockets.
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
The worker does pay for it, they pay for it in lower wages. If you have £15k budget to pay someone you offer them ~£14250 but if you are offering £15k then you had ~£15850 budget but have already planned for HMRC getting their mits on the rest of it. Either way it is a direct tax on employment no different to the visible taxes.
All the employee cares about is their take home pay. Whether their wages are gone via income tax or national insurance of either stripe is immaterial. All the employer cares about is their labour budget that it costs them. Whether the cost goes to income tax or national insurance of either stripe is immaterial.
Only if you live in a perverted fictional imaginary world whereby prices don't respond to taxes does it make a difference.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
Employer's NI is absolutely a direct part of a salary cost but the
Employers NI will never get merged in for the simple reason is the effect for most employees it would just be whacking 14% on income tax and the company pocketing the savings.
reasoning of @Pagan2 is true because of the very strong psychological fiction shared by everyone that it is not.
EE/ER Pension costs are not, nor are travel externalities as the pension goes to the future employee's self and the travel costs may or may not be incurred (WFH and so forth)
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Ultimately in a free market it will be pretty damned close to £850 because that was the labour budget and in a free market the prices will respond so that the budget is met. Just as if you add fuel duty the price at the pump responds, even though on your receipt at the petrol station fuel duty is "invisible" since its not listed on the receipt - all you have is the cost of the fuel and VAT.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
There will always be banking crises. The point is that until Brown screwed up banking supervision, they had always been successfully contained by the BoE without any bank runs, ever since the reforms following the collapse of Overend, Gurney and Company in 1866.
Yes, of course, we would have been hit by the global financial crisis. But if Brown hadn't screwed up financial supervision so badly, we wouldn't have been so badly hit by it, with two of our four major banks effectively going bust and having to be rescued by the taxpayer.
The self-isolation U-turn seems like ancient history now, in view of the sudden and unexpected drop in the infection rate. It seems that the most reckless prime minister in recent history is also the luckiest.
I reckon the problem for the government now is that the most plausible of the post hoc explanations is that it's related to schools breaking up. If the infection rate is driven by schools to that extent, it poses the question of what will happen when schools go back and we get towards the Autumn, and whether the decision not in general to vaccinate under-18s is wise.
"the most reckless prime minister in recent history"
Nah, Tony Blair was much more reckless wrt the Iraq invasion. That was an utterly unforced error. Johnson's had to deal with something utterly novel in political terms: there have been pandemics before, but we now have many more tools to try to tackle them, albeit some of those tools are rather immature and novel. I'd also say Brown's treatment of the economy that led to the crash was reckless and unforced.
I really don't envy anyone having to make decisions in this pandemic. There're too many people on all sides shouting that their way is better: even when those ways vary and oppose each other. The decisions also have to take into account other factors, such as education and the economy.
IMV throughout the epidemic there have been no 'good' answers: only ones in varying positions on the 'bad' scale.
Gordon Brown's "treatment of the economy" did not lead to the crash, which was caused by the global financial crisis. To believe otherwise, you'd need to credit Brown with successfully steering Britain around the GFC only to fall into a quite separate hole at the same time. Which oddly enough did happen a few years earlier, hence the hubris about abolishing boom and bust.
Well, that's a view. I'd argue that if he had treated the economy between 1997 and 2008 properly, instead of as a way to get power, we'd have been in a much better place to withstand any turmoil occurring abroad. Instead he drove us into it at full speed, contributing to, rather than mitigating, the GFC.
But he still became PM, so it worked out okay for him, I suppose.
(I actually see parallels between Brown and Johnson; which is strange as they are morally very different people.)
Mine is indeed a view, and oddly enough it is the view shared by almost all reputable commentators, including the US Government.
It's amazing how 'reputable commentators' equals 'people who agree with me'
Do you agree or disagree that the crash hurt Britain more because of the policies Brown had implemented for ten years?
Disagree. There, that was easy.
Here is 600 pages of official US inquiry into the global financial crisis. Think of it as a latterday Warren Commission, the canonical truth, settled and accepted for all time (with the page that says "it was all bloody Gordon Brown's fault" mysteriously redacted, even though the American government would have a lot to gain from blaming someone else). https://www.govinfo.gov/content/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf
Doing battle with the Tory Story about the GFC, I see. Good luck. It's still harder to counter than it ought to be. The myth went deep into the national psyche. One of the great pieces of political narrative weaving by the Cons.
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
For a start you cannot include employers NI because it doesn't come out of the employees 15k he earns. So thats 850 gone straight away. So what you are really saying is just make pensioners pay NI
Of course it comes from it. Where does it come from? Fairies? The ether?
If I have a budget of £15k to pay someone then I need to take NI into account or I lose money. So I have to reduce the salary to pay for the NI as it is coming from the same pot.
If you want another way to look at it: Pension £15k Tax £484 Take home pay £14,516
Total budget for wages £15000:
Wages £14253 Employers NI £747 Total wage budget £15000 Tax £335 Employers NI £562 Take home pay £13356
Because we were comparing someone earning 15k to a pensioner also on 15k. The employer ni is invisible to the employes his paypacket says he earns 15k and his tax deductions are 1136 from that. Your way would leave the pensioner 850 poorer a year than the one who has a headline wage of 15k
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
It's an indirect cost to employees but a direct cost on employment - is how I'd put it.
Its a direct cost on employment to the employer, who will be taking it into account when they set salaries.
Its literally direct which is why its the same damned P32 payment to HMRC. It is part and parcel of PAYE every bit as much as the other side of NI.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
That is a different criticism - not debating the merits of your post, just that it is different from what I was commenting about. And was described by the Tories as "an idea whose time had come" in their 2007 report advocating a bonfire of regulation to let the likes of Northern Rock and RBS do more of the casino capitalism that ultimately bust them.
On Topic: Polls are largely irrelevant this far out from a GE. However in my opinion, the best that Labour can do is eliminate the Tory majority at the next GE. As far as London is concerned, I would say Tories will be doing well if they can retain 15 seats in the capital. Unfortunately the UK is not London!
“Over several decades children in residential and foster care suffered levels of cruelty and sexual abuse that are hard to comprehend,” said the chair of the inquiry, Prof Alexis Jay....
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
LMFAO Jezziah your new profile is funny.
In reality the country is pretty contentedly moving into summer - but yes expect a lot of silly season stories to emerge, just like every summer.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why would it? I have worked for lots of companies, and most of them are quite happy to pocket savings from government. The idea that each employee pays ENIC's as a hypothecated tax which even in part would come back to them if abolished simply doesn't reflect business.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
The other thing people don't seem to comment on is the percentage increase from triple lock is not the actual percentage pensioners actually get if they also have other pensions.
Using my earlier example and using 9k as state pension amount to simplify
If inflation grows at 5% tripping that as the percentage for triple lock.
5% on a 15k wage increases it 15.75 our pensioner on 9k state pension and 6k private gets now 9.45k state pension +6k private which comes out as an increase overall of 3%
I am not a defender of triple lock, merely pointing it out as a lot of people make it seem like its on total income not just state pension element
That is a very good point. It's a significant factor only for the poorest pensioners, i.e. those very or entirely reliant on state pensions. Those people are not well-off!
It's still a bad policy, and perverse in the current very odd circumstances, but it's a myth that state pensions are generous.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
There will always be banking crises. The point is that until Brown screwed up banking supervision, they had always been successfully contained by the BoE without any bank runs, ever since the reforms following the collapse of Overend, Gurney and Company in 1866.
Yes, of course, we would have been hit by the global financial crisis. But if Brown hadn't screwed up financial supervision so badly, we wouldn't have been so badly hit by it, with two of our four major banks effectively going bust and having to be rescued by the taxpayer.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why would it? I have worked for lots of companies, and most of them are quite happy to pocket savings from government. The idea that each employee pays ENIC's as a hypothecated tax which even in part would come back to them if abolished simply doesn't reflect business.
Companies have a budget to pay labour costs. If the budget goes up (due to lower taxes) then they can bid more in salary offers to attract the best employees. If the budget goes down (due to higher taxes) then they can bid less in salary offers.
Only if your salary is entirely unresponsive to market conditions would your claims be right. Each employees ENICs absolutely are a direct cost that is part and parcel of their labour budget.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
If you think the old "are you quite sure about this, chaps?" BoE regulation model would have headed off the 08 crash I have a lovely little bridge I'd like you to take a look at.
The other thing people don't seem to comment on is the percentage increase from triple lock is not the actual percentage pensioners actually get if they also have other pensions.
Using my earlier example and using 9k as state pension amount to simplify
If inflation grows at 5% tripping that as the percentage for triple lock.
5% on a 15k wage increases it 15.75 our pensioner on 9k state pension and 6k private gets now 9.45k state pension +6k private which comes out as an increase overall of 3%
I am not a defender of triple lock, merely pointing it out as a lot of people make it seem like its on total income not just state pension element
That is a very good point. It's a significant factor only for the poorest pensioners, i.e. those very or entirely reliant on state pensions. Those people are not well-off!
It's still a bad policy, and perverse in the current very odd circumstances, but it's a myth that state pensions are generous.
I would prefer a higher state pension, say 12k , merge ni into income tax and maybe add on top a private pension band of for example 5k and for every 1k you get in excess you lose 5% of state pension. So once above private pension of 25k you are getting no state pension.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
If you think the old "are you quite sure about this, chaps?" BoE regulation model would have headed off the 08 crash I have a lovely little bridge I'd like you to take a look at.
It prevented every other bank crash for more than a century.
Brown's regulations didn't even last a decade before failing, twice.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why wouldn't it be zero - there will be a lot of people with few other options where it would be perfectly possible for the employer to offer £0 on a take it or leave option as leaving isn't an option?
There are very few industries where the full £850 would be paid to the worker.
ENIC is just one of many taxes that companies pay the government. One drops a little, another rises a little. Salaries are set on the amounts paid. If the cost of employment rises or falls there is no blanket adjustment to salaries which are benchmarked both against each other internally and against other salaries in the market.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
If you think the old "are you quite sure about this, chaps?" BoE regulation model would have headed off the 08 crash I have a lovely little bridge I'd like you to take a look at.
Perhaps. But every derivatives trader had multiple copies of his passport with HR, and had had his desk junior click through the multiple choice compliance exams. Then sold CDO to widows and orphans.....
Meanwhile Ed Balls was claiming that anyone worried about derivatives was "talking down Britain".....
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
For a start you cannot include employers NI because it doesn't come out of the employees 15k he earns. So thats 850 gone straight away. So what you are really saying is just make pensioners pay NI
Of course it comes from it. Where does it come from? Fairies? The ether?
If I have a budget of £15k to pay someone then I need to take NI into account or I lose money. So I have to reduce the salary to pay for the NI as it is coming from the same pot.
If you want another way to look at it: Pension £15k Tax £484 Take home pay £14,516
Total budget for wages £15000:
Wages £14253 Employers NI £747 Total wage budget £15000 Tax £335 Employers NI £562 Take home pay £13356
Because we were comparing someone earning 15k to a pensioner also on 15k. The employer ni is invisible to the employes his paypacket says he earns 15k and his tax deductions are 1136 from that. Your way would leave the pensioner 850 poorer a year than the one who has a headline wage of 15k
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
It's an indirect cost to employees but a direct cost on employment - is how I'd put it.
Its a direct cost on employment to the employer, who will be taking it into account when they set salaries.
Its literally direct which is why its the same damned P32 payment to HMRC. It is part and parcel of PAYE every bit as much as the other side of NI.
Yes, a direct cost on employment. That's right. But not a direct cost to the employee. It's an indirect cost to the employee. Feeds through to some extent and over time. Unlike income tax or employees NI which hits the wallet in full and immediately.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why wouldn't it be zero - there will be a lot of people with few other options where it would be perfectly possible for the employer to offer £0 on a take it or leave option as leaving isn't an option?
There are very few industries where the full £850 would be paid to the worker.
ENIC is just one of many taxes that companies pay the government. One drops a little, another rises a little. Salaries are set on the amounts paid. If the cost of employment rises or falls there is no blanket adjustment to salaries which are benchmarked both against each other internally and against other salaries in the market.
Salaries are set on the amounts paid which includes ENIC.
Benchmarked other salaries in the market would change too as other companies would have also seen a 14.5% increase in their labour budget as a result of the tax change - and employees would be able to demand that in their negotiations or go to another company that will spend its budget on higher wages.
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
For a start you cannot include employers NI because it doesn't come out of the employees 15k he earns. So thats 850 gone straight away. So what you are really saying is just make pensioners pay NI
Of course it comes from it. Where does it come from? Fairies? The ether?
If I have a budget of £15k to pay someone then I need to take NI into account or I lose money. So I have to reduce the salary to pay for the NI as it is coming from the same pot.
If you want another way to look at it: Pension £15k Tax £484 Take home pay £14,516
Total budget for wages £15000:
Wages £14253 Employers NI £747 Total wage budget £15000 Tax £335 Employers NI £562 Take home pay £13356
Because we were comparing someone earning 15k to a pensioner also on 15k. The employer ni is invisible to the employes his paypacket says he earns 15k and his tax deductions are 1136 from that. Your way would leave the pensioner 850 poorer a year than the one who has a headline wage of 15k
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
It's an indirect cost to employees but a direct cost on employment - is how I'd put it.
Its a direct cost on employment to the employer, who will be taking it into account when they set salaries.
Its literally direct which is why its the same damned P32 payment to HMRC. It is part and parcel of PAYE every bit as much as the other side of NI.
Yes, a direct cost on employment. That's right. But not a direct cost to the employee. It's an indirect cost to the employee. Feeds through to some extent and over time. Unlike income tax or employees NI which hits the wallet in full and immediately.
ENIC is paid immediately, it just comes from having a lower salary as a result.
If you mean as a tax grab the Chancellor can grab higher taxes and it will take time before the next salary review to see lower wages as a result then that's true, but that's true of almost all tax changes.
Ultimately direct taxes have only one place to go. They affect the prices and the market responds pretty rapidly, even if you don't directly see it.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why would it? I have worked for lots of companies, and most of them are quite happy to pocket savings from government. The idea that each employee pays ENIC's as a hypothecated tax which even in part would come back to them if abolished simply doesn't reflect business.
Companies have a budget to pay labour costs. If the budget goes up (due to lower taxes) then they can bid more in salary offers to attract the best employees. If the budget goes down (due to higher taxes) then they can bid less in salary offers.
Only if your salary is entirely unresponsive to market conditions would your claims be right. Each employees ENICs absolutely are a direct cost that is part and parcel of their labour budget.
Salary costs end up with all kinds of quirky names and acronyms. My experience of managing "SG&A" to use one example is that the pressure is always to reduce it. Your example is of a one-off cut in costs thanks to the abolition of ENIC. In the real world a more realistic example is expensive salary employee leaves the business. Thanks to a smart bit of recruitment their replacement is on 70% of the salary.
The 30% saved doesn't stay in my team's SG&A for me to increase the rest of the team's wages. At best it goes into another team who need to add a head and have no budget left, or most often is taken as part of the cost reduction demand during the year.
"Market conditions" have nothing to do with it. Only in a world where all the competitors sudden;y gave everyone the same pay rise would that even be a consideration, and even then its only one part of a remuneration / company attractiveness package.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why would it? I have worked for lots of companies, and most of them are quite happy to pocket savings from government. The idea that each employee pays ENIC's as a hypothecated tax which even in part would come back to them if abolished simply doesn't reflect business.
Companies have a budget to pay labour costs. If the budget goes up (due to lower taxes) then they can bid more in salary offers to attract the best employees. If the budget goes down (due to higher taxes) then they can bid less in salary offers.
Only if your salary is entirely unresponsive to market conditions would your claims be right. Each employees ENICs absolutely are a direct cost that is part and parcel of their labour budget.
Salary costs end up with all kinds of quirky names and acronyms. My experience of managing "SG&A" to use one example is that the pressure is always to reduce it. Your example is of a one-off cut in costs thanks to the abolition of ENIC. In the real world a more realistic example is expensive salary employee leaves the business. Thanks to a smart bit of recruitment their replacement is on 70% of the salary.
The 30% saved doesn't stay in my team's SG&A for me to increase the rest of the team's wages. At best it goes into another team who need to add a head and have no budget left, or most often is taken as part of the cost reduction demand during the year.
"Market conditions" have nothing to do with it. Only in a world where all the competitors sudden;y gave everyone the same pay rise would that even be a consideration, and even then its only one part of a remuneration / company attractiveness package.
That's how taxes operate though, they affect prices through the entire market not just one business. So yes your competitors will have also suddenly see a 14% increase in their labour budget - unless that is of course your competitors were paying cash in hand to dodge taxes that you were being obliged to pay making it harder for you to compete with your competitors.
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why wouldn't it be zero - there will be a lot of people with few other options where it would be perfectly possible for the employer to offer £0 on a take it or leave option as leaving isn't an option?
There are very few industries where the full £850 would be paid to the worker.
ENIC is just one of many taxes that companies pay the government. One drops a little, another rises a little. Salaries are set on the amounts paid. If the cost of employment rises or falls there is no blanket adjustment to salaries which are benchmarked both against each other internally and against other salaries in the market.
Salaries are set on the amounts paid which includes ENIC.
Benchmarked other salaries in the market would change too as other companies would have also seen a 14.5% increase in their labour budget as a result of the tax change - and employees would be able to demand that in their negotiations or go to another company that will spend its budget on higher wages.
They may in whichever business you personally have direct managerial responsibility for, but not in any of my decade in management. Salary is package - offer x salary y car z pension and other totalling bang. Does that compare well in the market, can we get the person we need for that?
If yes then add in employer costs to the total chunk needed, but I have never nor have I ever seen a package described as set on basis of salary + ENIC.
I would love to hear your personal real world examples. I know you like to keep what you do quiet, so disguise it. Tell us about a time when you managed a team budget, had to pitch for a new head, did a salary review.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
That actually looks like £484 vs £1136 paid by the individual, depending on your views on what Employers NI corresponds to.
Employers NI is income tax, no real difference whatsoever. Employers account for it in their budgeting, if it wasn't there then they could afford higher wages.
Very true - all staff costs go into the budget.
However, you know fully well that you cannot compare the tax burden of a worker with a pensioner by adding their employer's costs onto the employee. Does the employee pay ENICs? No.
Yes they do. They pay for it in recuced wages as it comes out of their wage budget.
To claim otherwise is dishonesty, pure and simple.
Never been convinced by that argument
Employees are willing to work for the net wage. Most focus on the gross wage (excluding employer NI) when negotiating terms.
Sure employers *could* pay more if there were no social contributions but what evidence do you have that they *would* pay more?
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
LMFAO Jezziah your new profile is funny.
In reality the country is pretty contentedly moving into summer - but yes expect a lot of silly season stories to emerge, just like every summer.
does anyone remember what the big long-runningUS news story was in August 2001?
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Why would it? I have worked for lots of companies, and most of them are quite happy to pocket savings from government. The idea that each employee pays ENIC's as a hypothecated tax which even in part would come back to them if abolished simply doesn't reflect business.
Companies have a budget to pay labour costs. If the budget goes up (due to lower taxes) then they can bid more in salary offers to attract the best employees. If the budget goes down (due to higher taxes) then they can bid less in salary offers.
Only if your salary is entirely unresponsive to market conditions would your claims be right. Each employees ENICs absolutely are a direct cost that is part and parcel of their labour budget.
Salary costs end up with all kinds of quirky names and acronyms. My experience of managing "SG&A" to use one example is that the pressure is always to reduce it. Your example is of a one-off cut in costs thanks to the abolition of ENIC. In the real world a more realistic example is expensive salary employee leaves the business. Thanks to a smart bit of recruitment their replacement is on 70% of the salary.
The 30% saved doesn't stay in my team's SG&A for me to increase the rest of the team's wages. At best it goes into another team who need to add a head and have no budget left, or most often is taken as part of the cost reduction demand during the year.
"Market conditions" have nothing to do with it. Only in a world where all the competitors sudden;y gave everyone the same pay rise would that even be a consideration, and even then its only one part of a remuneration / company attractiveness package.
That's how taxes operate though, they affect prices through the entire market not just one business. So yes your competitors will have also suddenly see a 14% increase in their labour budget - unless that is of course your competitors were paying cash in hand to dodge taxes that you were being obliged to pay making it harder for you to compete with your competitors.
The two of you are coming at it from opposite extremes. The reality is that in most companies, most employees would see most of the tax cut, with sufficient publicity well in advance of the changes.
The biggest problem is that the government would only see about 25% of it back!
Here is 600 pages of official US inquiry into the global financial crisis. Think of it as a latterday Warren Commission, the canonical truth, settled and accepted for all time (with the page that says "it was all bloody Gordon Brown's fault" mysteriously redacted, even though the American government would have a lot to gain from blaming someone else). https://www.govinfo.gov/content/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf
Timothy Geithner, US Treasury Secretary, was asked what the primary cause of the financial crash was and explicitly blamed financial regulation in London, as it lead to a race to the bottom in loosening regulation. Who was the person who changed London's financial regulation dramatically? Gordon Brown.
I realise that we've been having this argument for over a decade now, but the idea that Brown bears no responsibility will not wash with anyone who is objective. Brown took an axe to UK banking and finance regulation, and was warned about the risk he was taking, and the UK ended up right in it as a consequence.
No. To coin an analogy, it is as if I am defending Boris Johnson for his Covid strategy, and a lot of PB Tories are saying ah yes, but he is a shopping trolley, or he funnelled public money to his girlfriend, or he took brown envelopes to pay for his holiday and wallpaper. Even if any of these charges is true, and that is a fair-sized if, they are all irrelevant to the question of the Covid pandemic. Even if Brown did mess up supervision or run too loose a fiscal policy or chuck Nokias at the wall, it made no difference to the GFC. It did not cause the GFC. It did not exacerbate the GFC. It was all irrelevant.
The implication of simplifying the employment tax system is that employment taxes would have to fall - simply because if people realised how high they were they would be outraged.
Broadly speaking, we have the following total marginal rates:
>£8k pa - employee's NI @ 12% and employer's NI @ 13.8% = 25.8% total
>12.5k pa - base income tax @ 20% = 45.8% total
>50k pa - higher rate income tax @ 40%, but employee's NI drops to 2% = 55.8% total
£100k to £125k pa - lose tax-free threshold = 75.8% total
£125k to £250k pa - revert back to 55.8%
>£150k pa - additional income tax - increase back to 60.8%
For people with student loans, add perhaps another 5 to 10% onto the above.
Anyone arguing that we should be increasing employment taxes needs their heads checked.
They should just get it over with and tax the state pension. People already raking in the money from their final salary pensions don't need the extra pittance from the government.
It is taxed already. If you have no other income your personal allowance covers it so you don't pay tax, but it's counted in together with whatever else you're getting.
I was more thinking with a taper.
If someone has a 6k income from private pension plus the circa 9k from state pension how much more income tax are you propsosing they pay than someone earning 15k?
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
For a start you cannot include employers NI because it doesn't come out of the employees 15k he earns. So thats 850 gone straight away. So what you are really saying is just make pensioners pay NI
Of course it comes from it. Where does it come from? Fairies? The ether?
If I have a budget of £15k to pay someone then I need to take NI into account or I lose money. So I have to reduce the salary to pay for the NI as it is coming from the same pot.
If you want another way to look at it: Pension £15k Tax £484 Take home pay £14,516
Total budget for wages £15000:
Wages £14253 Employers NI £747 Total wage budget £15000 Tax £335 Employers NI £562 Take home pay £13356
Because we were comparing someone earning 15k to a pensioner also on 15k. The employer ni is invisible to the employes his paypacket says he earns 15k and his tax deductions are 1136 from that. Your way would leave the pensioner 850 poorer a year than the one who has a headline wage of 15k
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
It's an indirect cost to employees but a direct cost on employment - is how I'd put it.
Its a direct cost on employment to the employer, who will be taking it into account when they set salaries.
Its literally direct which is why its the same damned P32 payment to HMRC. It is part and parcel of PAYE every bit as much as the other side of NI.
Yes, a direct cost on employment. That's right. But not a direct cost to the employee. It's an indirect cost to the employee. Feeds through to some extent and over time. Unlike income tax or employees NI which hits the wallet in full and immediately.
ENIC is paid immediately, it just comes from having a lower salary as a result.
If you mean as a tax grab the Chancellor can grab higher taxes and it will take time before the next salary review to see lower wages as a result then that's true, but that's true of almost all tax changes.
Ultimately direct taxes have only one place to go. They affect the prices and the market responds pretty rapidly, even if you don't directly see it.
As below -
If IT or Ees NI goes up, the Ees net pay is reduced immediately and by that amount.
If Ers NI goes up, the Ees net pay will over time and to some extent be reduced.
These are different scenarios. You have a point - that Ers NI hits Ees - but you're overstating and simplifying it.
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
LMFAO Jezziah your new profile is funny.
In reality the country is pretty contentedly moving into summer - but yes expect a lot of silly season stories to emerge, just like every summer.
does anyone remember what the big long-runningUS news story was in August 2001?
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
When the BoE used to regulate my grandpa the “killer question” the senior guy would ask them each time was “which of your competitors are you most worried about and why”
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
There’s been a lot going on in the last 18 months or so
Fascinating to hear Philip insist he is right and everyone else is not just wrong but "dishonest" (or "liars" to use his other favourite term) or "ignorant."
The employee taking £15k from their employer is not on a £15k salary. Just they have a headline salary of £14253
A headline salary of £15k costs £15850 not £15000 so whichever way you slice it Employers NI is a direct cost on employees. Your pretensions of invisibility only convince the ignorant.
This is laughable. "The employee TAKING £15k". As in what they get paid. That is £15k. Not £14,253. That it costs the employer a whole host of other cash is not the employee taking that from the employer. Why stop at ENIC? You may as well add all other benefits on. How about their share of indirect costs as well?
I am doing company P&L right now. I have a whole load of staffing costs, but as my spreadsheet our accountant and HMRC are "dishonest" and "ignorant" for some reason the costs of employment aren't actually paid to the employee.
The Wizard of Wazza. The World Expert of Everything talking total bollocks. Call that "dishonest" or "ignorant" as you see fit.
I never said the money was going to the employee and you are completely wrong. Assuming they are a PAYE employee then what they get paid is not £15k under any scenario, since under PAYE the taxes go direct to HMRC and the employee gets the take home pay.
Are your employees getting paid PAYE and still receiving the Income Tax paid to them instead of to HMRC? Or receiving Employees NI paid to them instead of HMRC?
Actually what I bet your accountants or whoever is doing the payroll are doing is making one payment to the employee of their take home pay and making one payment to HMRC of their P32 payment which will include the income tax, employee NIC and employer NIC all bundled together. Because they're three sides of the same coin, even if one side is kept invisible.
Employer NIC goes in the same labour budget pot and unless its different to my experience literally goes to HMRC in the same payment as employee NIC and income tax because they're the same frigging thing. They're just behind the scenes - and yes if you were too ignorant or dishonest to realise that all the PAYE taxes all go to HMRC, in the same bank transfer even in my experience, rather than to the employee then maybe you should try to learn how these things operate yourself before calling others with experience in this field a "Wizard".
Lol you know I run a business yeah? I am very well aware of how HMRC get paid.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays Income Tax £484 National Insurance £652 Employers NI £850 Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
As others have said you are both partly right. If ENIC was suddenly removed the workers income would fairly quickly increase by an amount between £0 and £850 but not either £0 or £850. We don't know what that amount is, but it wont be close to either £0 or £850.
Ultimately in a free market it will be pretty damned close to £850 because that was the labour budget and in a free market the prices will respond so that the budget is met. Just as if you add fuel duty the price at the pump responds, even though on your receipt at the petrol station fuel duty is "invisible" since its not listed on the receipt - all you have is the cost of the fuel and VAT.
Prices respond to taxes. Wages are a price.
In the long run we are all dead
The supply of workers is available at the net cost (let’s say £14k).
If the employer NI is removed then the employer *could* pay up to £15k and maintain the same profitability
But unless there is an external factor that enables the worker to negotiate a higher salary then their “share” of the tax saving will start at zero.
Over time competition for the best workers will tend to increase their price (salary) but that would happen anyway.
All removing employer NI does is increase employer profits over what they would otherwise be
The other thing people don't seem to comment on is the percentage increase from triple lock is not the actual percentage pensioners actually get if they also have other pensions.
Using my earlier example and using 9k as state pension amount to simplify
If inflation grows at 5% tripping that as the percentage for triple lock.
5% on a 15k wage increases it 15.75 our pensioner on 9k state pension and 6k private gets now 9.45k state pension +6k private which comes out as an increase overall of 3%
I am not a defender of triple lock, merely pointing it out as a lot of people make it seem like its on total income not just state pension element
That is a very good point. It's a significant factor only for the poorest pensioners, i.e. those very or entirely reliant on state pensions. Those people are not well-off!
It's still a bad policy, and perverse in the current very odd circumstances, but it's a myth that state pensions are generous.
I would prefer a higher state pension, say 12k , merge ni into income tax and maybe add on top a private pension band of for example 5k and for every 1k you get in excess you lose 5% of state pension. So once above private pension of 25k you are getting no state pension.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
I wonder if the electric ones are any more reliable?
Wouldn't fancy ending up in the water in front of a carrier.
From the comments: What is not shown is as the crew ejected one of the aircrew parachutes drifted over the angle deck and myself along with 15 other flight deck personnel were able to pull the aircrew member back on deck. If we had not grab his chute he would have been run over by the carrier and sucked under the ship...
The pilot died, as he was ejected into the falling seat of one of the crew who'd ejected earlier in sequence.
... Brown got the blame for the under-regulation of the banks, yet the Tories had been hounding him for over-regulating the banks. ...
No, no, no! This is a complete misrepresentation of both the reality and the criticisms of him. You don't judge regulation by quantity. People on the left seem to think that it's a linear scale, more regulation = better.
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
Exactly Richard. There were thousands of people working at the FSA, with huge amounts of regulation, and in the end the agency proved to be absolutely bloody useless, because it could not really tell if the banks and institutions it regulated were solvent.
The fringe banking crisis waves. But all this is interesting but irrelevant to the GFC. Even if it is true, having a blister no longer matters if you've driven over the edge of a cliff.
If your plane is too heavy to take off under normal circumstances, your situation is worsened immeasurably if you suddenly veer off the runway and go over the edge of a cliff.
I wonder if the electric ones are any more reliable?
Wouldn't fancy ending up in the water in front of a carrier.
From the comments: What is not shown is as the crew ejected one of the aircrew parachutes drifted over the angle deck and myself along with 15 other flight deck personnel were able to pull the aircrew member back on deck. If we had not grab his chute he would have been run over by the carrier and sucked under the ship...
The pilot died, as he was ejected into the falling seat of one of the crew who'd ejected earlier in sequence.
Ugh. That's unlucky.
I remember an old Martin Baker ejector test rig at Farnborough / Pyestock but sadly I never saw it used. Probably there just for show...
I understood that it may have been used for 'joyrides' in the distant past.
The self-isolation U-turn seems like ancient history now, in view of the sudden and unexpected drop in the infection rate. It seems that the most reckless prime minister in recent history is also the luckiest.
I reckon the problem for the government now is that the most plausible of the post hoc explanations is that it's related to schools breaking up. If the infection rate is driven by schools to that extent, it poses the question of what will happen when schools go back and we get towards the Autumn, and whether the decision not in general to vaccinate under-18s is wise.
"the most reckless prime minister in recent history"
Nah, Tony Blair was much more reckless wrt the Iraq invasion. That was an utterly unforced error. Johnson's had to deal with something utterly novel in political terms: there have been pandemics before, but we now have many more tools to try to tackle them, albeit some of those tools are rather immature and novel. I'd also say Brown's treatment of the economy that led to the crash was reckless and unforced.
I really don't envy anyone having to make decisions in this pandemic. There're too many people on all sides shouting that their way is better: even when those ways vary and oppose each other. The decisions also have to take into account other factors, such as education and the economy.
IMV throughout the epidemic there have been no 'good' answers: only ones in varying positions on the 'bad' scale.
Gordon Brown's "treatment of the economy" did not lead to the crash, which was caused by the global financial crisis. To believe otherwise, you'd need to credit Brown with successfully steering Britain around the GFC only to fall into a quite separate hole at the same time. Which oddly enough did happen a few years earlier, hence the hubris about abolishing boom and bust.
Well, that's a view. I'd argue that if he had treated the economy between 1997 and 2008 properly, instead of as a way to get power, we'd have been in a much better place to withstand any turmoil occurring abroad. Instead he drove us into it at full speed, contributing to, rather than mitigating, the GFC.
But he still became PM, so it worked out okay for him, I suppose.
(I actually see parallels between Brown and Johnson; which is strange as they are morally very different people.)
Mine is indeed a view, and oddly enough it is the view shared by almost all reputable commentators, including the US Government.
It's amazing how 'reputable commentators' equals 'people who agree with me'
Do you agree or disagree that the crash hurt Britain more because of the policies Brown had implemented for ten years?
Disagree. There, that was easy.
Here is 600 pages of official US inquiry into the global financial crisis. Think of it as a latterday Warren Commission, the canonical truth, settled and accepted for all time (with the page that says "it was all bloody Gordon Brown's fault" mysteriously redacted, even though the American government would have a lot to gain from blaming someone else). https://www.govinfo.gov/content/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf
I've been out, but just have to say that that is irrelevant to the question I actually asked ...
Comments
It wasn't the quantity of regulation that Brown screwed up, it was the sheer mindless box-ticking, incoherent mess of regulation that was the problem. Zillions of forms filled in and reports filed by armies of compliance officers, almost all of of it a complete waste of time, brain-dead exams for employees in the industry, and no-one in charge of monitoring the overall stability of the banking system. It was Brown, egged on by Ed Balls, who created the utterly stupid tripartite system, leaving no-one in charge of the big picture. The supervisory role which for 150 years had been successfully handled by the BoE without a single run on the banks in that entire period was taken away from the BoE and given to ... no-one.
And it led to disaster exactly as Francis Maude had predicted in the Commons during the debate on the Bank of England Act 1998.
https://twitter.com/f1troll_/status/1417794638556114946
The point is that, since the two above cases would ultimately result in the same take-home pay for most employees (although the gross salaries would be very different), it doesn't make sense to "pretend" that a small amount of ENI is meaningfully a tax on employers, rather than what it actually is, which is a stealth income tax on employees.
In the same vein, the distinction between income tax and NI is pure spin designed to make people feel better about how much they're paying to the taxman out of their wages.
Methinks you have something against the EU, what tragedy did they cause in your household?...more like bitter and twisted for some reason.
Employers NI will never get merged in for the simple reason is the effect for most employees it would just be whacking 14% on income tax and the company pocketing the savings. No government that did that would ever get reelected
I realise that we've been having this argument for over a decade now, but the idea that Brown bears no responsibility will not wash with anyone who is objective. Brown took an axe to UK banking and finance regulation, and was warned about the risk he was taking, and the UK ended up right in it as a consequence.
If VAT permanently changes, if duties permanently changes, if Employers NIC permanently changes, then that would result in changes to prices - which includes wages.
You compared the income of a pensioner with the income of an employee. ENIC is not income. Your comparison was "dishonest". Your exact words:
The worker on default tax codes according to a tax calculator pays
Income Tax £484
National Insurance £652
Employers NI £850
Total tax: £1986
The pensioner pays £484
The worker does not pay ENIC.
But again, it being tough does not mean its not the right thing to do.
There are very few industries where the full £850 would be paid to the worker.
Using my earlier example and using 9k as state pension amount to simplify
If inflation grows at 5% tripping that as the percentage for triple lock.
5% on a 15k wage increases it 15.75
our pensioner on 9k state pension and 6k private gets now
9.45k state pension +6k private which comes out as an increase overall of 3%
I am not a defender of triple lock, merely pointing it out as a lot of people make it seem like its on total income not just state pension element
Armed police / high street being cleared by armed police and 2 helicopters and stretchers being taken into a shop i'm hearing
I know this doesn't come as happy news to the tories on here and they may deny it but this is the worst it has been since the winter of discontent in 1978/9.
All the employee cares about is their take home pay. Whether their wages are gone via income tax or national insurance of either stripe is immaterial.
All the employer cares about is their labour budget that it costs them. Whether the cost goes to income tax or national insurance of either stripe is immaterial.
Only if you live in a perverted fictional imaginary world whereby prices don't respond to taxes does it make a difference.
Employers NI will never get merged in for the simple reason is the effect for most employees it would just be whacking 14% on income tax and the company pocketing the savings.
reasoning of @Pagan2 is true because of the very strong psychological fiction shared by everyone that it is not.
EE/ER Pension costs are not, nor are travel externalities as the pension goes to the future employee's self and the travel costs may or may not be incurred (WFH and so forth)
Prices respond to taxes. Wages are a price.
Yes, of course, we would have been hit by the global financial crisis. But if Brown hadn't screwed up financial supervision so badly, we wouldn't have been so badly hit by it, with two of our four major banks effectively going bust and having to be rescued by the taxpayer.
Its literally direct which is why its the same damned P32 payment to HMRC. It is part and parcel of PAYE every bit as much as the other side of NI.
https://www.bbc.co.uk/news/uk-57984924
https://www.theguardian.com/uk-news/2021/jul/27/hundreds-of-children-abused-while-in-care-of-lambeth-council-inquiry-finds
...Although many of children had been taken into care after suffering violence and neglect at the hands of family members, the report noted that for many “the experience they had [in the residential homes] was worse than living at home with their birth families.”
“Over several decades children in residential and foster care suffered levels of cruelty and sexual abuse that are hard to comprehend,” said the chair of the inquiry, Prof Alexis Jay....
In reality the country is pretty contentedly moving into summer - but yes expect a lot of silly season stories to emerge, just like every summer.
https://youtube.com/watch?v=ZyvY2GK9B3M
It's still a bad policy, and perverse in the current very odd circumstances, but it's a myth that state pensions are generous.
A fascinating tale from a more robust age.
Only if your salary is entirely unresponsive to market conditions would your claims be right. Each employees ENICs absolutely are a direct cost that is part and parcel of their labour budget.
Brown's regulations didn't even last a decade before failing, twice.
Meanwhile Ed Balls was claiming that anyone worried about derivatives was "talking down Britain".....
Benchmarked other salaries in the market would change too as other companies would have also seen a 14.5% increase in their labour budget as a result of the tax change - and employees would be able to demand that in their negotiations or go to another company that will spend its budget on higher wages.
If you mean as a tax grab the Chancellor can grab higher taxes and it will take time before the next salary review to see lower wages as a result then that's true, but that's true of almost all tax changes.
Ultimately direct taxes have only one place to go. They affect the prices and the market responds pretty rapidly, even if you don't directly see it.
The 30% saved doesn't stay in my team's SG&A for me to increase the rest of the team's wages. At best it goes into another team who need to add a head and have no budget left, or most often is taken as part of the cost reduction demand during the year.
"Market conditions" have nothing to do with it. Only in a world where all the competitors sudden;y gave everyone the same pay rise would that even be a consideration, and even then its only one part of a remuneration / company attractiveness package.
If yes then add in employer costs to the total chunk needed, but I have never nor have I ever seen a package described as set on basis of salary + ENIC.
I would love to hear your personal real world examples. I know you like to keep what you do quiet, so disguise it. Tell us about a time when you managed a team budget, had to pitch for a new head, did a salary review.
https://www.youtube.com/watch?v=UeZKyGDo5Io
Employees are willing to work for the net wage. Most focus on the gross wage (excluding employer NI) when negotiating terms.
Sure employers *could* pay more if there were no social contributions but what evidence do you have that they *would* pay more?
The biggest problem is that the government would only see about 25% of it back!
Broadly speaking, we have the following total marginal rates:
- >£8k pa - employee's NI @ 12% and employer's NI @ 13.8% = 25.8% total
- >12.5k pa - base income tax @ 20% = 45.8% total
- >50k pa - higher rate income tax @ 40%, but employee's NI drops to 2% = 55.8% total
- £100k to £125k pa - lose tax-free threshold = 75.8% total
- £125k to £250k pa - revert back to 55.8%
- >£150k pa - additional income tax - increase back to 60.8%
For people with student loans, add perhaps another 5 to 10% onto the above.Anyone arguing that we should be increasing employment taxes needs their heads checked.
If IT or Ees NI goes up, the Ees net pay is reduced immediately and by that amount.
If Ers NI goes up, the Ees net pay will over time and to some extent be reduced.
These are different scenarios. You have a point - that Ers NI hits Ees - but you're overstating and simplifying it.
That gave them the leads they needed
I wonder if the electric ones are any more reliable?
Wouldn't fancy ending up in the water in front of a carrier.
The supply of workers is available at the net cost (let’s say £14k).
If the employer NI is removed then the employer *could* pay up to £15k and maintain the same profitability
But unless there is an external factor that enables the worker to negotiate a higher salary then their “share” of the tax saving will start at zero.
Over time competition for the best workers will tend to increase their price (salary) but that would happen anyway.
All removing employer NI does is increase employer profits over what they would otherwise be
What is not shown is as the crew ejected one of the aircrew parachutes drifted over the angle deck and myself along with 15 other flight deck personnel were able to pull the aircrew member back on deck. If we had not grab his chute he would have been run over by the carrier and sucked under the ship...
The pilot died, as he was ejected into the falling seat of one of the crew who'd ejected earlier in sequence.
I remember an old Martin Baker ejector test rig at Farnborough / Pyestock but sadly I never saw it used. Probably there just for show...
I understood that it may have been used for 'joyrides' in the distant past.