Weekend reading: Roll with it
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Re stamp duty: how do stop homeowners cashing in by just increasing the asking price by the stamp duty reduction?
Re VWRL price reduction: that will save me 2k a year but as I am in the 69.5% Scottish tax trap zone that’s equivalent to 5k gross earnings from work, so that’s nice
@TI… Surely Hull and Huddersfield as comparisons should have been Hull and Halifax as in the Thieves’ Litany…
There is a proverb and a prayer withall,
That we may not to three strange places fall;
From Hull, from Hell, from Halifax, ’tis this,
From all these three, Good Lord, deliver us.
This praying proverb’s meaning to set down,
Men do not wish deliverance from the town;
The town’s named Kingston, Hull’s the furious river;
And from Halifax’s dangers, I say, Lord, deliver.
At Halifax, the law so sharp doth deal,
That whoso more than 13 pence doth steal;
They have a gyn that wondrous, quick and well,
Sends thieves all headless unto Heaven or Hell.
From Hell each man says Lord, deliver me.
Because from Hell can no redemption be.
Men may escape from Hull and Halifax,
But sure in Hell, there is not heaier tax.
Let each one for themselves in this agree,
And pray – from Hell, Good Lord, deliver me
JimJim
Devolution ? Maybe I am getting old but going back 40 years and this problem was recognised, trying to push growth and wealth to the regions. That’s why various goverment departments are in Newcatle, South Wales, Liverpool etc.
Problem is growth is organic. Manchester, Sheffield, Swansea all grew because money was generated there through coal and whatever. Pushing surplus funds towards them doesn’t compensate for the change in terms of trade.
So I think it’s Cnut exercise.
He’s rearranging the deck chairs because there isn’t much he really can do I think, constrained between gilt yields and expectations, so the most helpful thing can do is high visible cheap stuff, busywork.
The savings from energy vat should be enough to buy a cream egg a week!
If welfare is indexed to inflation but tax thresholds are not, there’s a growing disincentive. It pushes up the market rate for labour, makes us uncompetitive, that’s why we lost industry to countries without the same welfare. Welfare also props up rents etc, creating underlying demand, which is hard to compete against. As tax becomes a larger part of every transaction, the odds of a wage rise ever exceeding your personal inflation rate after tax is lower – the cost of living problem is down to the tax burden
Speaking here from devolved Scotland managed/mismanaged decline is my feeling
Cannot build a Ferry Boat(we have lots of islands),higher rates of tax than rest of U.K. (no incentive to progress much over a £50000 job as the extra just goes in tax) ,lowest education standards in U.K. (only just rejoined international audit systems),most people work for government or councils (relatively good salaries,low expectations,little accountability,bomb proof pensions etc) not good for business
All subsidised by a stream of never ending English gold
The less said about our current crop of politicians-Sturgeon et al the better
Their travails are well known -public are rather disillusioned
Devolution at the moment just appears to add another layer ( many layers?) of well paid rather ineffective “leaders”
However Scotland appears to be pulling off the Commonwealth games successfully at the moment albeit it’s a cut down tournament (no money) not available to the public via our £180+ BBC TV-thank goodness for Amazon and HBO
That’s enough from me!
xxd09
Post-Brexit, the UK has lost critical mass so a big idea of splitting it into even smaller parts that can compete with each other because they are too small to compete outside the UK doesn’t make a whole lot of sense to me. You end up with French style Régions – meaningless constructions fighting each other for subsidies. The admin overhead means it is not even a zero sum game and potentially you end up with ugly examples of self-interest as regularly featured in Private Eye.
Secure our Energy /Water infrastructure and food chain (i.e. don’t kill off farming) as a national priority. Deal with organised criminality. Introduce a paid National Service (not necessarily military) to build community and nationhood, recognising that desk-based employment opportunities will become more scarce.
Messing about with tax rates, pensions etc without doing the above invites a bigger correction downstream. I don’t think the current crop of politicians across any party have the talent to deliver on this as a whole but I live in hope that decent people with talent continue to take their turn and eventually we get a capable Government.
It doesn’t feel like there’s much to be positive about at the moment.
I’m certain my cohort will have the screw turned even tighter on tax. Personally I’ve had enough and it’s already knocked any further aspiration out of me. My goals now are how quickly I can get comfortable with a lower income and wind things back.
@TI if this reads as too personal please feel free to edit / delete it.
Meaningful Money hit the nail on the head about time.
Long story short, when I thought that I was Coast FIRE I quit a well compensated contracting gig in the City to retrain and then teach English in Japan.
Back in the UK, IT again but as a permie, the idea that Japan could have waited crossed my mind. We should have made bank for a few more years before IR35 finally bit, been nearer fat FIRE and then gone on an adventure.
I am fortunate because a life changing cancer diagnosis confirmed that we had made the right choice to go when we did. I am on the mend but still 3-5 years of monitoring ahead of me. I shall be pushing 60 before travel insurance is less than £3k pa (and that’s excluding the USA!).
There is a season in life for all things and whatever else happens, see your GP if something doesn’t feel right!
What on earth was the question if the answer is more politicians and civil servants.
People with ideas and drive create growth so Govt, should, as far as is possible, get out of their way and concentrate on the important things that support growth, education, abundant cheap energy and observation of the rule of law. You could also argue for a flat 10% rate of income tax, Sales tax, IHT and simplification of the tax code.
What beats me is that there’s a fairly clear consensus among think tanks across the political spectrum on some mainly revenue neutral reforms which would simplify the tax code, increase fairness, and help economic growth – reform CGT (rates aligned to income, with indexation, no uplift on death), abolish SDLT and Council Tax and replace with a Land Value Tax or similar (with transitional relief), reform VAT to broaden the base, lower the rate and threshold, remove ridiculous wrinkles (cake vs biscuit!)(again with targeted help), iron out the tax traps around Child Benefit and withdrawal of personal allowance, reduce the gap between projected and real tax receipts from SMEs, etc. Instead, it’s yet more supposedly eye-catching announcements, adding further complexity, and doing little to help anyone.
Burnham should probably have an emergency budget in the near future. Otherwise the endless speculation about what he is going to do will cause its own damage.
@TI – I think your list of measures is a good starter for 10. Though I would want to make the argument for a manifesto commitment at the next election to rejoin the EU SM.
@ Martin T – There’s a very detailed piece by Dan Neidle on replacing Stamp Duty and Council Tax with a Land Value Tax. It was quite eye opening to me to realise how much political judgement is required in designing such a system to deal with the inevitable edge cases and regional differences, the transition issues also. It seemed to me though that it would eventually be a simplification of what we have now.
@TI
“… All my decisions would be through a lens of economic growth. ..”.
I think rather a lot of my decisions would be along the lines of what kind of a country do I want to live in, and how much the constant howls for economic growth contribute to or detract from that.
Devolution. If the people of Scotland felt that devolution had failed, they wouldn’t have voted to keep a nationalist party in power for the past 19 years. Apart from anything else, I can recall what it was like long before devolution. Labour ruled the cities, mouthed the slogans, didn’t actually do much for the ordinary working person, and had a persistent reputation for widespread low level corruption. The Conservatives..? They were well on the decline at the time I left Scotland. My local MP was a (C), one Teddy Taylor, a hanger and flogger. Someone once remarked that calling Taylor by a cuddly name like Teddy was like referring to the Hound of the Baskervilles as ‘Rover’. And then came Thatcher…
London ? Devolution can’t come quick enough, call it Manchesterism, or whatever.
@xxdo9. (5)
In both Scotland and England the vast majority of people work in the private sector. In England about 18% work in the public sector, I believe. In Scotland, it’s about 22%. At a guess, I’d say much of the difference is that Scotland is a far less densely populated country, and, as you say, has lots of islands. The public service infrastructure has to service those communities, for example, schools with tiny numbers of pupils.
Close relatives of mine live on an affluent Scottish island. I don’t think they’d recognise a homeless person, unless they went to Glasgow for the day, and tripped over one on their way to Pret a Manger. And yet…, they moan endlessly about the ferries. I sometimes feel like saying…. “You both had a great Scottish education, that gave the pair of you the way into never really having to experience significant money worries, your kids both university educated, doing well., you make condescending comments about IKEA. Is ferries all you have to moan about ?”.
Trufflehunt-I stand corrected on those private and public sector jobs percentages in Scotland
We too live on an affluent Scottish Island and have little to complain about in all the areas you mention ( and our ferries work!) -it’s the future which preoccupies me as times get harder and more expensive for all
No doubt comparing previous perceived good times with the current situation is what drives a lot of the angst
xxd09
@Trufflehunt — You write:
“I think rather a lot of my decisions would be along the lines of what kind of a country do I want to live in, and how much the constant howls for economic growth contribute to or detract from that.”
Clearly I understand the perspective that economic growth (/money/industry/whatnot) is over-emphasised in modern life. It is indeed a feature of our time that everything from the utility of a university degree to the Instagram-influencer-ability of what was just a quiet hobby seems to be wrung through a monetisation forcing function.
However, the reality is we’ve seen barely any growth for years in the UK, especially for ordinary people in real terms who don’t have a lot of (overseas!) assets, and that this has demonstrably hurt the kind of aspirations I suspect underpin your comment.
The greatest of these was of course Brexit. We wanted ‘sovereignty’. We wanted ‘to take back control’. These were desires that only incompetents or the mendacious linked to economic growth. However they could be linked to ‘the kind of country we want to live in’ as you put it, and I’m sure most of the 52% would have said something like that even then. Now the economic shambles of the move has been amply illustrated, a majority surely would now.
As a result we’re at least £120-150bn annually down on GDP (lost economic growth) and as a result down £40-60bn in tax reciepts.
That is a couple of ‘black holes’ of spending worth of lost opportunity, upgrading, initiatives, helping the less fortunate, or indeed increasing tax bracket thresholds — or whatever other good things one’s definition of a good country to live in might entail.
What’s more, this ‘lost’ growth (of which there’s more than Brexit to add to the mix — take the UK’s productivity puzzle for example) has deeper societal ramifications. Graduates who don’t find suitable jobs. Companies that don’t invest in the UK. Strains on lives and relationships.
If it was 1989 or even 1999 and we were at the backend of a growth spurt I’d agree we should raise our sights, but right now I think we need to put our metaphorical nose to the grindstone to get the economy going again in order to pay for the kind of society we aspire to, and that we’ve collectively made much harder to achieve in the UK of late.
Cheers 🙂
As a high-rate, PAYE taxpayer living in the South East, I spend a lot of time looking at numbers, spreadsheets, and efficiencies. It’s a core habit when you are chasing the FIRE lifestyle.
Naturally, it makes me look at the country through the same optimization lens. If the UK were a business—or a retirement portfolio—it would be getting a serious talking-to from its financial advisor right now.
I’m no career politician, but it feels like common sense has left the building. Here is my slightly flawed, but highly necessary manifesto:
1. The 25% Flat Tax (Simplifying the System)
The current tax system is a multi-tiered labyrinth. Why does the percentage go up just because you work harder and earn more? It acts as a massive disincentive for productivity.
• The Fix: A flat 25% tax on all earnings from zero to infinity.
• The Balancing Act: Simultaneously raise the minimum wage to fully offset the impact on lower earners.
• The Result: A transparent system where if you earn twice as much, you simply pay twice as much. No loopholes. No bracket creep.
2. Supercharging the Next Generation
If we want a booming economy, we have to stop taxing companies for training local talent.
• The Fix: Introduce a 0% National Insurance rate for both apprentices and their employers.
• The Result: Instant incentives for businesses to build a skilled workforce without the heavy tax penalties.
3. Ending the Government “Use It or Lose It” Waste
Right now, government departments are heavily incentivised to burn cash. If a department doesn’t spend its entire budget by April, the Treasury slashes its funding for the next year.
• The Fix: Centralise waste management and reward departments for saving money while maintaining public service standards.
• The Result: Ending the mad March spending sprees on useless corporate consulting and over-priced office chairs.
4. Aggressive Infrastructure Upgrades
We need to treat national infrastructure as the foundational asset it is. We should look at countries like Sweden for digital connectivity and build real resilience.
• Energy: Massive National Grid upgrades backed by utility-scale battery storage. Let’s achieve absolute renewable self-sufficiency.
• Water: Modernise the pipes and build larger reservoirs. If one water firm can avoid hosepipe bans for 30 years, the rest have no excuse.
• Digital: Bulletproof 5G and superfast fibre broadband everywhere. No dead zones.
5. Accountability Through Privatisation
The current “half-public, half-private” setup for essential services leaves us with the worst of both worlds.
• The Fix: Privatise essentials entirely—including hospital infrastructure.
• The Result: Clear ownership. If a system fails, the public knows exactly who is responsible and who to hold accountable, rather than dealing with endless political finger-pointing.
6. Drawing a Hard Line on Train Strikes
The endless rail strikes are actively ruining people’s daily lives, crushing productivity, and damaging local economies.
• The Fix: Legislate to completely ban strikes on critical national rail infrastructure.
• The Reality Check: Train drivers are already compensated significantly better than the national average. It’s time to keep the wheels moving.
7. Overhauling the Welfare Trap
The welfare system currently penalises personal responsibility, which drives a FIRE enthusiast crazy.
• The Problem: Stripping people of safety-net benefits the exact moment they manage to accumulate a modest emergency fund is a total joke. It actively discourages saving.
• The Fix: Redesign the thresholds to stop penalising thriftiness, while tightening loopholes to prevent structural exploitation of the state.
8. The British Sovereign ISAs
We need to actively funnel domestic wealth back into UK plc.
• The Fix: Offer a bonus £5,000 ISA allowance strictly ring-fenced for investing in a UK Sovereign Wealth Fund.
• The Result: Tax-free growth for savers, and billions in cheap capital for the government to build the infrastructure mentioned above.
9. Protecting Our Communities
A great country requires safe streets and distinct local identities.
• Stop the Urban Sprawl: Down here in Kent, the rapid expansion of towns is swallowing historic villages into one giant, homogenous megacity. We need smarter urban planning.
• Visible Policing: We need a drastic increase in visible police presence on the streets to restore community safety and public respect.
• Bring People Together: I’m no hippy, and I don’t know the exact mechanical sequence to fix loneliness, but wouldn’t it just be great if we focused on basic community pride and being decent to each other again?
AI Incoming…..
“These are results for ‘what would be the result in the uk of having a universal rate of tax of 25%’.
AI Overview
Implementing a universal 25% flat tax rate in the UK would radically shift the tax burden, resulting in massive tax cuts for high earners, significant tax hikes for low-income workers, and a substantial decline in overall government revenue unless accompanied by deep public spending cuts. “.
[Source: Tax Justice Network].
@Tom (16) Over to you. In my opinion, the assertion that privatisation provides accountability is utterly laughable. The UK rail network was privatised in the mid-90’s, with responsibility for the infrastructure assigned to a new company called ‘Railtrack’. Within a few short years there were several rather horrendous rail accidents due to safety failings and poor maintenance. It soon became obvious that Railtrack had insufficient resources to pay for the consequences of those accidents, and they approached the government ( now of a different political complexion ) for a bailout. The government did bail them out. Railtrack promptly used the money to pay the next dividend to their shareholders. No I didn’t make this up. The government then forced Railtrack into bankruptcy, and created Network Rail as the public body to maintain the rail infrastructure.
The lesson being…, it’s no use going on about responsibility, and accountability when the animal spirits of corporations do what they do, extract profits, and when they fail, in terms of essential services, the sh*t all ends up in the laps of the government, or in the sea, or in the rivers.
@Trufflehunt — I appreciate the history lesson on Railtrack, though it proves my point about the flaws of the “half-public, half-private” model where profits are privatised and losses are socialised. That is exactly the hybrid failure my post argued against.
As for the AI snippet on the flat tax, it misses the critical balancing mechanism I explicitly mentioned: raising the minimum wage to protect lower earners. I’m no career politician, just an individual looking at macro efficiency and sharing a casual brainstorming session. I still think exploring structural tax reform and sovereign investment is worth the conversation, even if my only official say is a single vote.
@Tom (18).
“half-public, half-private” is ambiguous, and as such does not in any way prove your previously unstated point about moral hazard /privatisation of the profits and socialisation of the losses. In fact, as history, and current events with water companies demonstrates, complete privatisation of essential services is an exact recipe for what you seek to cure.
My local water company Bristol Water, after privatisation, was long owned by the Malaysian Sovereign Wealth Fund. Easy money for the investors. Predictable earnings from a very loosely regulated* utility company, captive customers.
Those investors/extractors are gone now. The successor outfit, Pennon, has the £6 Billion+ of debts they left behind. My water bills are rising at the rate of 10% a year. I’m still a captive customer.
* I once read the OFWAT regulatory framework document. It was very short, vague, and a cynic might say it could be translated by a water company as ‘do as you wish’.