What is it about the Liberal Democrats that makes me feel sorry for them - I can't quite put my finger on it. Perhaps it's because the Scottish libdem bloggers are a pleasant bunch and are quite a cohesive force in their criticisms of Scottish politics.
However, today's announcement that the 'rich' are to be taxed much more in order to take 300,00 poor out of the tax bracket is just so ludicrous it makes the libdems look like they desperately need a lesson in economics.
Vince Cable, their Media Celeb, has recently admitted he was wrong about the Lloyds TSB/HBOS takeover and I'm sincerely hoping he'll admit to being wrong about this, although listening to Nick Clegg on radio, I 'hae ma doots' that Vince will break the party line.
The proposal is a property tax which targets properties over £1m, on the assumption that the owners are 'rich'.
"We have seen the super-rich pouring their money not into job creating businesses but into acquiring mansions,” he said, as he turned his fire on bankers, businessmen and the Shadow Cabinet’s former members of the Bullingdon Club.
Yes he has a point there, but what they should be proposing is a complete overhaul of the banking system to stop banker's recent behaviour ever happening again and he should be proposing a new taxation system as the present one allows certain big business companies/people to avoid taxation.
But to go for people who own homes valued at £1m and over is telling those who can afford to live in such a property that it will cost them more. Running a large house is expensive and those who can afford to own one are, in many cases, preserving buildings which may well either be sold to developers or demolished to make way for another concrete tower.
I know people who have homes in this bracket and the value is usually because they live in areas which can demand, what I consider, silly prices. My friends are certainly not 'rich' but what is termed nowadays as 'asset rich'. Paying a few thousand pounds more a year to stay in their homes (which they have worked hard for all their lives) could see them having to sell up and moving to a smaller property. Why are people like that being forced to make such a choice? I thought the libdems were all for choice, but this proposal leaves no choice. Well that's not quite true; the choice is pay up or move to a cheaper home.
Why didn't the libdems support IDS's paper which was issued last week? That makes sense to me. Raise the non-tax level to £12,000 and have a standard rate of tax for everyone. Easier to collect and calculate and then perhaps the Inland Revenue could spend more time investigating the big boys who avoid tax, but at the same time encouraging those who have the ability to earn larger salaries that they are welcome in the UK.
Who make the laws that allow tax avoidance? You're right - politicians. Governments have created a layer of tax accountants because of the complex system and never ending new legislation and regulation.
So libdems, this proposal makes me pleased I'm not a libdemer because all it's going to do is discourage people from buying larger properties, unless they are filthy rich of course, then a few thousand pounds is petty cash and at the same time make the older generations of this country feel very insecure because many know they cannot pay more out of their pensions.
Doesn't do a lot for today's pensioners does it? Those pensioners who have worked all their lives and managed, through many sacrifices to to achieve a comfortable home. Now the libdems want more money from them when their pensions pots have been raided by pathetic Westminster legislation, which dare I say, there was little if any protest from the libdems during debates against the measures.
Pity they couldn't support the tory proposals or even suggest they would have talks with the tories. You can read IDS's proposals here. I'll be accused of being a real right-winger with this post but I make no apologies for supporting Ian Duncan Smith's paper. It just makes sense along with the SNP's policy of taxation based on income not the size or value of your home.
Source: Times
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26 comments:
At least Cable is trying to put forward proposals to aleviate the rich/poor gap. We haven't heard anything from New Labour and i wouldn't put money on the Tories anouncing any tax changes, too many pals in the banking sector i suppose. Cable's target is the rich people who sit on their wealth rather than spend any of it. By trying to get at this sitting money, he is attempting to put some liquidity into the ecconnomy, which amongst all the talk of cuts has been somewhat ignored.
What is seriously needed though is wholesale tax reform, not just tinkering at the sides, and also an end to the exchange in personel between HMRC and certain accountaints who employ ex civil servants for their knowledge in tax avoidance. A point mostly unreported last week was the many millions wasted in tax placed beyond the reach of HMRC, yet Brown seems to be resiting implimenting the findings of the G20 conference, conflict of interest anyone?
My understanding is the property tax will be means tested so any one who is not rich£££ will not have to pay
Welcome aboard!
Seriously though the Cable myth has now been well and truly exposed and the Lib Dems are shown as being seriously flawed in their thinking.
As we try and come out of a recession this sort of thinking will do nothing to help the UK to become solvent again. We need to encourage people as much as possible to get out there and work hard and be paid well for their good efforts. If we don't they will just sit back and say I'm better off doing nothing.
"What is it about the Liberal Democrats that makes me feel sorry for them"
Encountering the Lib Dems is a bit like treading in fake dog poo. Not as bad as the real thing but it still leaves a bad impression and is not funny.
Allan, the tories put forward a very comprehensive tax rehaul last week. Did you look at my link?
Many who live in houses worth a market value of £1m+ are 'asset rich' and do not have the money to pay more tax.
I shall give you a prime example. I live in a rather lovely house which I feel I certainly deserve after 40+ years of hard work and many, many sacrifices.
My private pension has been radically reduced and, together with my state pension, I now have an income of less than £10,000pa.
There is no way I could afford to pay a penny more in tax, most of my savings have gone in higher utlity charges and taxes.
So you're suggesting I sell and downsize to a box for a pensioner because that's where I'd end up.
Where is the respect and recognition for these people who do have a pleasant home but the libdems wish to punish them for it? Nowhere.
Bad bad idea from the libdems, I never thought they would consider such a policy.
Auch Niko, I'd believe the sun will shine every day until I die before I believed that.
The Scottish bunch show what the rest of the Scottish political blogosphere could do if they worked together though WW.
Some just resent others for some unknown reason and it's the same with the libdems, they seem to resent anyone who has worked hard enough to have a comfortable home.
Tax should be on the ability to pay and income.
Hey FL, I'm not joining the tories, even though they promised me a crate of my favourite malt and a year's supply of M & S carrier bags.
But yes, the are looking rather silly making this a 'main' policy.
I still think that Vince Cable was the only one of the three English finance spokesmen that had the foggiest notion of what was going on during the financial crisis.
That said I totally disagree with him over this stupid tax on property.
A million pounds is peanuts in some parts of London for example. Many people could be living there with almost no money at all in the bank. Just a family home bought at a time when property in the area was really cheap.
There are surely better ways of taxing the rich than this nonsense.
What I am saying is that the Lib Dems are at least puting ideas across. Rather like IDS's paper on benefits last week, the details will probably appear at a later date, and the form of the policy will be slightly diferent.
What Cable has put his finger on though (and this is why the freeze in Council Tax is so popular) is that not very many people are in any position to pay tax, or at least those not able to manipulate the tax laws.
IDS paper looked promising and I am sure his heart is in the right place, but on closer inspection it's pretty shit. Plus (on today's theme) he wants to subsidise mortgage payments.
@ tris, property taxes are the best way of taxing the rich, in fact the best way of taxing anybody, because it requires no reporting, does not discourage work or savings (because not directly related to income or production) and cannot be evaded by taking assets abroad.
For every misery guts who sells his stately pile, ninety per cent of the value of which is tax free capital gains, there will be somebody else willing to buy it - have you never noticed the tendency of rich people to live in the nicest houses?
This tax is no worse than a 0.5% hike in interest rates, in fact it's a lot better, because higher interest rates hurt the economy and this doesn't.
But I guess people in this country are so brainwashed that it's far too late to revert to the basics of good taxation as outlined by Adam Smith & David Ricardo. That is the real reason this country is so screwed, it is because it is run with the sole aim of pandering to property owners.
SR, one minor point on the minimum level for tax and the same tax rate 'across the board'.
Be fair, the Tories are only copying something Ukip has been advocating for a few years!
But let us not nit-pick!
For those living in London, the home counties, or the English shires, the proposals of Vince Cable may have some degree of interest.
For those, like myself, living here in the Highlands, this suggestion can only be regarded as sheer lunacy. It could lead to the Highland Clearances all over again.
Living in a modest farmhouse and having a few acres if Highland heather and stone, and very little money in the bank, having to pay any form of property tax could just be the final straw that breaks the camels back.
Faceless accountants and valuers may put a sum as to the worth of this property, but that paper asset value can only be realised with the sale of the property. That is something I have no desire to do.
This property is not held as a financial investment by some city group, it is a family farm handed down through several generations, each generation having to work to pay the taxes and duties due, whilst still trying to eke out an income.
It is already written into my will that my ashes be scattered here on our ground. Please, I beg you, don’t let the Liberals, or anyone come to that, make me sell because I cannot pay the taxes on some arbitrary value on a piece of paper.
Mark:
You make an interesting and fair case for property tax, but your argument fails to consider the point that our host made about her own circumstances.
Additionally, property taxes are not just levied on those who OWN property. A person renting or leasing a property is still responsible for the tax thereon regardless of the fact that they will never make a penny out of the property.
I agree, however, with you regards the idiotic UK obsession (more English than Scottish) of property ownership. Only the very rich in, for example, Germany buy their own homes.
There is no point in putting forward proposals for the sake of it.
You can propose any number of taxes, but if they are not costed properly, seen to be unfair to some people, then you might as well give up and go home.
Yes Allan, but if they're putting ideas across they must have them solid and not, as you say, appear in policy form slightly differently.
Party conferences are a superb place for publicising new policy. The libdems made a hash of this today. giving little hope to those in the lower tax bracket (no details at all so no support from them) and taxing the 'rich' - defined by the value of their house.
Not my type of taxation thanks.
Sorry Mark but a property tax isn't a fair system. Taxes should be paid on the ability of a person to pay them.
If tax on my property increased then I'd have to sell up because, with a diminished income, I couldn't afford to maintain my home.
Unfortunately I'm too old to emigrate so I would just spent the whole lot on a good time then ask the council to house me.
Irresponsible? Yes. Sensible? Yes.
As for those with a stately pile they've always existed in Britain. They're in the top 10% of the wealth of this country.
I think the Scots have a slightly different attitude to wealth than the English.
I know several people who would be worth £1m today but they certainly don't live in stately piles.
This country is screwed not because it panders to property owners but to the bosses in the US.
My apologies WfW, I've been reprimanded a few times this evening for not mentioning the UKIP policy, but we shan't nit pick. :)
JRB, I'm completely with you on this, but then our situations won't matter in the great scheme of property taxation.
It certainly doesn't pay to be canny these days or make sacrifices to have a comfortable home.
And they only buy one home Tris, renting their weekend homes and other retreats. There's no shame in renting there because Germans aren't obsessed with home ownership. They'd rather have their wealth in a flash car or stocks and shares.
It was a missed opportunity Thatsnews. Party conferences are great shop windows and one of the few times even smaller parties make the main stream media.
SR you raise two questions a small one "What are the Lib/Dems for"? No idea!
The BIG question is why did they stick this idea into the real world?
I think the answer to this is that we have seen Vince respond to a distant echo of what is taking place in the USofA, namely the battle between the 9s and the 6s.
Anyone with 9 figures in their net worth is essentially a sovereign entity and can tell any tax man to go take a hike. The 9s have decided that the 6s are to be fleeced and that's why this meme of taxing the rich is turning up.
The destruction of the US middle class is what Vince has caught wind of and hence he's looking pretty vacant.
He has no idea, quite literally!!!
I'm a socialist and I think the idea stinks. Folks should be allowed to enjoy the fruits of their labour and frugality. Bad, bad Libdems.
Exactly scunnert.
Did anyone seen Vince Cable's performance on News Night?
...and do they come to the same conclusion that it was a fumbling, stumbling, rambling, unconvincing performance from a rather uncomfortable looking Mr Cable.
...and his avoidance of credible 'becauses' of just why so was utterly pathetic.
Now in the past I've had a few drams with Charlie Kennedy and been in his company when he's had a few, the same with myself.
...and even then, Charlie made more sense and was more cohesive than that fella Cable in the pursuit of his causes and becauses.
What a dismal and uninpiring performance.
I was not impressed, that's for sure.
Go stand in the corner facing the wall Vince.
...and Charlie, come back please, all is forgiven.
Didn't see it wisnaeme. If you think it's worth watching I'll view it on iPlayer.
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