Could someone Please!! Simplify this Jargon below : Con/Lib dem Tax proposal??? - HotUKDeals
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Could someone Please!! Simplify this Jargon below : Con/Lib dem Tax proposal???

DEALofaLifetime Avatar
6y, 6m agoPosted 6 years, 6 months ago
Could someone please help me understand this political jargon below by simplifying it as i am a little slow :) proposed by the Con/Lib dem coalition..... Thanx all

3. Tax Measures

The parties agree that the personal allowance for income tax should be increased in order to help lower and middle income earners. We agree to announce in the first Budget a substantial increase in the personal allowance from April 2011, with the benefits focused on those with lower and middle incomes. This will be funded with the money that would have been used to pay for the increase in Employee National Insurance thresholds proposed by the Conservatives, as well as revenues from increases in Capital Gains Tax rates for non-business assets as described below. The increase in Employer National Insurance thresholds proposed by the Conservatives will go ahead in order to stop Labour's jobs tax. We also agree to a longer term policy objective of further increasing the personal allowance to £10,000, making further real terms steps each year towards this objective.

We agree that this should take priority over other tax cuts, including cuts to Inheritance Tax. We also agree that provision will be made for Liberal Democrat MPs to abstain on budget resolutions to introduce transferable tax allowances for married couples without prejudice to this coalition agreement.

The parties agree that a switch should be made to a per-plane, rather than per-passenger duty; a proportion of any increased revenues over time will be used to help fund increases in the personal allowance.
DEALofaLifetime Avatar
6y, 6m agoPosted 6 years, 6 months ago
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banned#1
ha er not a clue, they are going to raise tax for the rich to pay for the poor I guess
1 Like #2
its just means that some people will have a higher amount of untaxed wages, ie your personal allowance at current is around £6545 or near that, once you earn above that allowance you are taxed accordingly
1 Like #3
it means that you will not be eligable for the basic rate of tax until you earn over 10k per year.

currently this figure sits at £6545 per year.

so for example someone earing 12k a year currently pays no tax on 6.5k of their earnings and 20% income tax on the remaining 5.5k.

under the new system they would pay no tax on 10k and 20% on only 2k of their annual wage.

however dont be supprised if there is a rise in national insurance as a result. I believe national insurance is currently at 11%.
#4
Richard S
it means that you will not be eligable for the basic rate of tax until you earn over 10k per year.

currently this figure sits at £6545 per year.

so for example someone earing 12k a year currently pays no tax on 6.5k of their earnings and 20% income tax on the remaining 5.5k.

under the new system they would pay no tax on 10k and 20% on only 2k of their annual wage.

however dont be supprised if there is a rise in national insurance as a result. I believe national insurance is currently at 11%.


:thumbsup: have a rep

Edit: so your saying we will get money in one hand and then give it out in the other eg: less tax up to £10k but If NI rises they will take it back through that??
banned#5
DEALofaLifetime
:thumbsup: have a rep

Edit: so your saying we will get money in one hand and then give it out in the other eg: less tax up to £10k but If NI rises they will take it back from that??


no they are going to magic the money out of pixie dust.

the idea behind the rise in NI but fall of lower rate tax (well rise in the threshold of 20% tax) is that low/mid earners will end up paying less tax (even after taking into account the increase in NI) but the high earners will pay a higher proportion through NI.
#6
DEALofaLifetime
:thumbsup: have a rep

Edit: so your saying we will get money in one hand and then give it out in the other eg: less tax up to £10k but If NI rises they will take it back through that??


possibly, but keep in mind NI affects employers and employee's. NI for someone earning what i posted above is 11% for the employee so far as im aware. so currently under the tax system after your tax free alowance you lose around 31% of your earnings. If the tax free allowance increases to 10K and NI to 12% the majority will still be significantly better off.

I cant spell :(
#7
bykergrove
no they are going to magic the money out of pixie dust.

the idea behind the rise in NI but fall of lower rate tax (well rise in the threshold of 20% tax) is that low/mid earners will end up paying less tax (even after taking into account the increase in NI) but the high earners will pay a higher proportion through NI.


quite right
banned#8
Richard S
quite right


what is the threshold for NI again? googled its about 5k
#9
We also agree to a longer term policy objective of further increasing the personal allowance to £10,000


Think this means it will be done 'eventually', next year will probably go up to £7-8k
#10
and the £10k tax threshold is going to be phased in over years
#11
I thought the cons political BS was that the NI rise wouldn't happen because cameron was always saying that brown was raising it and if cons got in power it wouldn't happen etc etc...but they are just gonna raise it anyway right?
#12
Don't get too excited, nobody is going to be better off in the short term.:roll:
#13
Inactive
Don't get too excited, nobody is going to be better off in the short term.:roll:


anyone working part time earning say 6-8k will be better off

even those in the 10-15k bracket will see a good £30-£40 a month increase in their wages if the tax free allowance increases to 7-8k next april
banned#14
Richard S
anyone working part time earning say 6-8k will be better off

even those in the 10-15k bracket will see a good £30-£40 a month increase in their wages if the tax free allowance increases to 7-8k next april


while people that got a good education + job end up getting ****ed again
#15
I got an education and a job, but only earn £15k per year, so i should be a bit better off
banned#16
sancho1983
I got an education and a job, but only earn £15k per year, so i should be a bit better off


if you can get a good job, then yes you should be better off.
#17
bykergrove
if you can get a good job, then yes you should be better off.


To be fair everone will benifit from the increase to 10k until you earn £121k which is where your tax free allowance becomes £0

so low earners will be much better off, middle earners slightly or no better off and only the very high earners a bit worse off. This is much less damaging than a blanket rise in income tax or narrowing the thresholds of the 40 and 50% tax rates.
banned#18
How about

Labour borrowed 1.5 trillion pounds

and we are all going to have to repay it.
#19
How about, the greedy banks stuffed the world economy and we are all going to have to pay the price for it.
banned#20
Inactive
How about, the greedy banks stuffed the world economy and we are all going to have to pay the price for it.


toshapetriji
How about

Labour borrowed 1.5 trillion pounds

and we are all going to have to repay it.


Either way, the money has to be paid back. There's enough blame for everyone.;-)
#21
Inactive
How about, the greedy banks stuffed the world economy and we are all going to have to pay the price for it.


didnt stop everyone cahing in on 120% value mortgages, store credit, maxing credit cards, huge overdrafts and then paying back pretty much the minimum.
banned#22
Inactive
How about, the greedy banks stuffed the world economy and we are all going to have to pay the price for it.


the banks only stuffed the worlds economy because the base layer of their products were people that took on too much debt and couldn't pay it back.
#23
bykergrove
the banks only stuffed the worlds economy because the base layer of their products were people that took on too much debt and couldn't pay it back.

Then it's the bank's fault for poor lending practice in the first place!
banned#24
muckypup
Then it's the bank's fault for poor lending practice in the first place!


blame the bush administration not the banks then. Owning houses for all Americans was their idea. and blame the rating agencies (who pretty much got off scot free too)

also, are you saying that people can't control themselves when it comes to credit?
#25
bykergrove
blame the bush administration not the banks then. Owning houses for all Americans was their idea. and blame the rating agencies (who pretty much got off scot free too)

also, are you saying that people can't control themselves when it comes to credit?

I have no issue with blaming Bush for anything!!:lol:

As for people having no control......it's true that some people don't,but the banks have to share the responsibility by not allowing folk to over extend themselves.
banned#26
muckypup
I have no issue with blaming Bush for anything!!:lol:

As for people having no control......it's true that some people don't,but the banks have to share the responsibility by not allowing folk to over extend themselves.


problem is, people that actually caused the sub prime products to unravel are the ones that think its all the banks fault and don't accept that this would not have happened (or been as bad) if so many of them had taken on debt that they couldn't pay back. but i guess lots of people don't like to take responsibility for their actions.
#27
bykergrove;8589381
also, are you saying that people can't control themselves when it comes to credit?


What I would say is that.
1. The Government and Media said "Buy your home - It's the future"
2. The Industry insisted that Houses were as safe as houses as they would always increase in value.
3. Banks fell over each other to convinced poorer families to join the party.
4. Those same banks then made money out of wrapping up those "dodgy" mortgages into toxic packages until in the end they the whole thing imploded.
[mod][Moderator]#28
muckypup
Then it's the bank's fault for poor lending practice in the first place!


Definately hasn't helped, my dad's bank sent him a unsolicited form for a pre approved credit card back in 2005, he signed it and they sent him one, despite the fact that he was a) 73, b) suffering from senile dementia and c) we had already informed the bank that he was no longer able to make financial descisions himself.

Luckily we got to the card before he did lol shame really it had a credit limit of £15000, we should've bought loads of stuff on it an then blamed his dementia::thumbsup:
#29
bykergrove;8589475
problem is, people that actually caused the sub prime products to unravel are the ones that think its all the banks fault and don't accept that this would not have happened (or been as bad) if so many of them had taken on debt that they couldn't pay back. but i guess lots of people don't like to take responsibility for their actions.

This is a total rewriting of history.

It was the banks that encouraged everyone and anyone to take out a mortgage knowing they themselves were going to package them up and sell them on. In the end it was the utter greed of these bankers that led to a total freeze as the banks slowly realised they had been selling each other crap for years.
banned#30
Plum
What I would say is that.
1. The Government and Media said "Buy your home - It's the future"
2. The Industry insisted that Houses were as safe as houses as they would always increase in value.
3. Banks fell over each other to convinced poorer families to join the party.
4. Those same banks then made money out of wrapping up those "dodgy" mortgages into toxic packages until in the end they the whole thing imploded.


Plum
This is a total rewriting of history.

It was the banks that encouraged everyone and anyone to take out a mortgage knowing they themselves were going to package them up and sell them on. In the end it was the utter greed of these bankers that led to a total freeze as the banks slowly realised they had been selling each other crap for years.


no, you just seem incapable to understand that things didn't implode randomly, the products fell apart because too many people started defaulting on their mortgages.
#31
bykergrove
no, you just seem incapable to understand that things didn't implode randomly, the products fell apart because too many people started defaulting on their mortgages.


they started defaulting because the banks were irresponsible and lent them money they they realistically could not afford to pay back,the banks did this because they got greedy and the chance of big profits outweighed common sense and responsible lending...faults on both sides
banned#32
boothy
they started defaulting because the banks were irresponsible and lent them money they they realistically could not afford to pay back,the banks did this because they got greedy and the chance of big profits outweighed common sense and responsible lending...faults on both sides


exactly, it doesn't matter how attractive banks made credit look they couldn't force it on someone unless they agreed to take on that mortgage. people forget the part that the poor people took. they may have been poor but free will is well..... free.
#33
boothy
they started defaulting because the banks were irresponsible and lent them money they they realistically could not afford to pay back,the banks did this because they got greedy and the chance of big profits outweighed common sense and responsible lending...faults on both sides


Nobody forced people to take out loans/mortgages etc.

I was trying to buy a house for the last 7 years, we would have always been struggling each month to pay the repayments and we didn't want to live like that, so instead we waited and saved then last Sept bought a house (probably at the height of the recession) with a 25% deposit and can comfortably pay the payments at the moment.

Too many people want everything now, sure the banks might have exploited that, but isn't that how businesses work?
#34
bykergrove
exactly, it doesn't matter how attractive banks made credit look they couldn't force it on someone unless they agreed to take on that mortgage. people forget the part that the poor people took. they may have been poor but free will is well..... free.


best to stop using the term "poor people"..it makes you look a right tit(no hate)
banned#35
sancho1983
Nobody forced people to take out loans/mortgages etc.

I was trying to buy a house for the last 7 years, we would have always been struggling each month to pay the repayments and we didn't want to live like that, so instead we waited and saved then last Sept bought a house (probably at the height of the recession) with a 25% deposit and can comfortably pay the payments at the moment.

Too many people want everything now, sure the banks might have exploited that, but isn't that how businesses work?


this. as i said before people don't want to take responsibility for their actions, if they can point at a big faceless bank for the trouble that THEY put themselves in then they'll do it as it makes them feel like a victim rather than an idiot. governments want votes so they are going to back the common people too hence the fashionable assault on the rich.
#36
Its very simplistic to just assert that people should not borrow beyond their means when everyone else seemed to be doing the same. A kind of mania sets in and too many get swept along.
If someone needed somewhere to live and renting privately cost x£s but with a mortgage they may start paying the same x£s but have 'greater security of tenure' and have the chance to make a profit in time, there are many that would be drawn to make such a jump.
It is up to the banks to control their lending policies deciding who may be able to keep up repayments and who would present a risk.
There was a time when I would get daily offers of loans and credit drop through the letter box. When things get to that state of affairs with institutions apparently throwing money at all, I think an inference has to be drawn that the lending institutions were foolhardy.
banned#37
boothy
best to stop using the term "poor people"..it makes you look a right tit(no hate)


ok the sub-prime market
#38
boothy
best to stop using the term "poor people"..it makes you look a right tit(no hate)


its easy to call people poor when you still live at home with your mum and havnt experienced the real world:thumbsup:
#39
lets stay on topic people;-)
banned#40
casparwhite
its easy to call people poor when you still live at home with your mum and havnt experienced the real world:thumbsup:


so when are you moving out?

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