What do you think about the 'Robin Hood tax' idea?

[DanMartin]

A new campaign calling for a 50p levy on every £1,000 traded by big institutions has been launched today. Organisers say the £250bn raised could be used to help the poor and deal with the economic crisis. It has been dubbed the 'Robin Hood Tax' and 'the world's biggest bank job'. What do you think of the idea? Here's more info (http://robinhoodtax.org.uk/).

[Zeno]

Just another tax. It will go into the same pot as all the others and be squandered in exactly the same way.

The cost will certainly not be swallowed by the financial institutions who will find some way of charging the end user, very possibly via bank charges to Joe Public.

[KM-Tiger]

Wrong time. What I think people want to see is:

New ways of spending taxpayers' money more effectively. We've had nearly ten years of throwing cash at public services to no effect.

A long-term plan to reduce taxation to sensible levels.

[elainec100@cheapaccounting]

I agree it will just end up being passed onto the consumer.

I would like to see a cohesive long term tax strategy and more visibility of the overall UK tax rate.

[KidsBeeHappy]

With less taxes, and less legislation. Driving fines for drinking bottles of water - lets ditch them please, and go back to a clearer normal tax system rather than all these hundreds of piddly taxes disguised as fines and penalties.

[Moneyman]

It sounds good. but if you are dealing in millions sometimes a transaction fee is 0.01%. This will become a big sum. Huge companies move money into and out of banks for short periods of a day or even less and this earns interest. we need this money sloshing about to give liquidity to the markets.

It is very unfair on the institutions that shift cash about. these banks are not necessarily the same sort of banks that caused the crash. The idiots who thought this up simply have a hatred of bankers rather than an understanding of the difference between transaction banking (absolutely necessary and good) and investment banking (the bad guys of the crash). It hits the wrong lot.

If it is going to collect £250B that is £250B of tax worth trying to find a way around. So what are the big institutions going to do to get round it?....they are going to do what got us into the big mess. Find some clever mechanism where money is moved but is not technically a "transaction". This will create further dodgy ways of valuing, moving assets etc and we all go bang again in a few years.

It is a tax and there is no such thing as a free lunch in banking sector. If it goes out it must come in from somewhere.

Just cut down on the liquidity ratios and all those offshore methods of hiding assets and tax avoidance and the banks will have to pay more tax without changing any rates and shifting the goalposts.

[Cornish Steve]

All taxes are bad ideas - full stop.

[Big Pete]

Just another tax. It will go into the same pot as all the others and be squandered in exactly the same way.

The cost will certainly not be swallowed by the financial institutions who will find some way of charging the end user, very possibly via bank charges to Joe Public.


I agree with Zeno ..

They are going to come up with all sorts of scams and it will all go in the bigger pot for them to squander ..

[David Griffiths]

Classic "Let's put up taxes - but only for other people" - scheme. :rolleyes:

[Zeno]

All taxes are bad ideas - full stop.

I'll regret this I am sure but how do you come by this idea?

What alternative would you propose?

[elainec100@cheapaccounting]

All taxes are bad ideas - full stop.

So do you think that all public services are bad ideas as well e.g. rubbish collection, street lighting, health, education, police, ambulance .........?

If not how would they be funded if not through taxes of some kind :|:|

[Cornish Steve]

So do you think that all public services are bad ideas as well e.g. rubbish collection, street lighting, health, education, police, ambulance .........?
Pretty much, yes.

Rubbish collection - private companies, more competition, better service
Education - private schools, more competition, better educated children
Ambulance - private companies, more competition, better service

The list goes on: hospitals, jails, road construction, .... All are run more efficiently by private companies. The profit motive and competition cut costs and improve service in almost every industry.

The only things for which we really need the government and hence for which they need funding are national defence, internal police force, and infrastructure items (which would include street lighting). I don't see any reason for 95% of what government does. Most is wasted on bureaucracy anyway.

And if you think this means we wouldn't help the most vulnerable in society, I wouldn't agree. Far more money is given by private individuals than governments when disaster strikes. We're not heartless enough to require government involvement - except to maybe coordinate some of the activities.

Income tax is a comparatively recent phenomenon. A hundred years ago (if I remember correctly), most people paid no income tax. It was levied to pay for wars, not as an excuse for government to grow or for endless welfare and entitlements. Once the government got into the habit of spending other people's money, though, it was difficult to quit.

With the passage of time, we now assume that taxes are necessary, but they really are not. They stifle individual responsibility, individual initiative, and economic growth. Research shows time and again that the best way to grow an economy (and, ironically, to raise tax revenue) is to cut taxes. Why doesn't it happen? Because government would be cutting its own throat. Tax money to them equals power.

[elainec100@cheapaccounting]

Income tax was introduced in 1815 I think - but David G will know for sure as ge was around then.

[Cornish Steve]

It was first introduced by William Pitt, I believe, but paid by a comparatively small percentage of the population.

[Big Pete]

Pretty much, yes.

Rubbish collection - private companies, more competition, better service
Education - private schools, more competition, better educated children
Ambulance - private companies, more competition, better service

The list goes on: hospitals, jails, road construction, .... All are run more efficiently by private companies. The profit motive and competition cut costs and improve service in almost every industry.

The only things for which we really need the government and hence for which they need funding are national defence, internal police force, and infrastructure items (which would include street lighting). I don't see any reason for 95% of what government does. Most is wasted on bureaucracy anyway.

And if you think this means we wouldn't help the most vulnerable in society, I wouldn't agree. Far more money is given by private individuals than governments when disaster strikes. We're not heartless enough to require government involvement - except to maybe coordinate some of the activities.

Income tax is a comparatively recent phenomenon. A hundred years ago (if I remember correctly), most people paid no income tax. It was levied to pay for wars, not as an excuse for government to grow or for endless welfare and entitlements. Once the government got into the habit of spending other people's money, though, it was difficult to quit.

With the passage of time, we now assume that taxes are necessary, but they really are not. They stifle individual responsibility, individual initiative, and economic growth. Research shows time and again that the best way to grow an economy (and, ironically, to raise tax revenue) is to cut taxes. Why doesn't it happen? Because government would be cutting its own throat. Tax money to them equals power.


Brilliant post...

[elainec100@cheapaccounting]

Sorry I'm not getting this.

Maybe public services should be provided by private companies (if that makes sense???) but they still need to be funded some how. And we still need them e.g. law and order, education, health etc.

Not everyone can afford to pay for health and education.

How would this happen?

Where do the funds come from? Who collects it?

[elainec100@cheapaccounting]

Tax history lesson ...

http://www.hmrc.gov.uk/history/taxhis1.htm

[Zeno]

It was first introduced by William Pitt, I believe, but paid by a comparatively small percentage of the population.

Introduced to pay for the Penisula wars in the late 1790's by Pitt. Abolished and resurrected numerous time ending with the current system of being brought into law yearly by the income tax acts.

[Zeno]

But you are only talking about direct income taxes here Steve. Tax in some form or other has existed since the dawn of civilisation.

[Cornish Steve]

Let's take an example.

The government requires children between the ages of 5 and 18 to receive a full-time education and they provide certain guidelines and standards that must be met. That's the end of their job.

Those who know how to provide education build schools. Some decide to attract parents who want the best and decide to pay for the best teachers. Others decide to focus on sports and build sports fields and equipment and stadiums. Others decide to focus on science and build wonderful labs. Others promise stricter discipline, and so on. Over time, parents move their children from badly run schools to the better run schools in line with their preferences. If there's no good school in one area, an entrepreneur will build one - because there's a market unmet. Continuously, new companies listen to the customer (parents) and build better schools that use more effective teaching methods and retrain their teachers. They hire the best, and they fire the ineffective. Quality goes up. Because of intense competition, costs go down. Because schools must listen to parents, those parents are more satisfied and have a greater say.

I realise there's more to it that this, but such an approach would revolutionise education. The quality of teaching would improve, and parents would retain ultimate responsibility for how their children are taught. Just as important, the government is unable to fill the curriculum with propaganda and political correctness and useless gumf - because parents would simply move their children to another school.

The issue, of course, is control. The government wants it. We've become so lax and lazy that we're prepared to give it to them. But that's not right. Parents are responsible, not government, for a child's education. Having been in the workplace for some time, they understand what's needed for a child to thrive as an adult. When the link between parent and child is cut, we fall into the trap of "nanny government knows best".

By cutting the government out of education, we'd save many many billions in unnecessary taxes.

[KidsBeeHappy]

Wasn't tax formalised first by the Church?
They were taking their 10% long before the government thought of it!

[Zeno]

Let's take an example.

The government requires children between the ages of 5 and 18 to receive a full-time education and they provide certain guidelines and standards that must be met. That's the end of their job.

Those who know how to provide education build schools. Some decide to attract parents who want the best and decide to pay for the best teachers. Others decide to focus on sports and build sports fields and equipment and stadiums. Others decide to focus on science and build wonderful labs. Others promise stricter discipline, and so on. Over time, parents move their children from badly run schools to the better run schools in line with their preferences. If there's no good school in one area, an entrepreneur will build one - because there's a market unmet. Continuously, new companies listen to the customer (parents) and build better schools that use more effective teaching methods and retrain their teachers. They hire the best, and they fire the ineffective. Quality goes up. Because of intense competition, costs go down. Because schools must listen to parents, those parents are more satisfied and have a greater say.

I realise there's more to it that this, but such an approach would revolutionise education. The quality of teaching would improve, and parents would retain ultimate responsibility for how their children are taught. Just as important, the government is unable to fill the curriculum with propaganda and political correctness and useless gumf - because parents would simply move their children to another school.

The issue, of course, is control. The government wants it. We've become so lax and lazy that we're prepared to give it to them. But that's not right. Parents are responsible, not government, for a child's education. Having been in the workplace for some time, they understand what's needed for a child to thrive as an adult. When the link between parent and child is cut, we fall into the trap of "nanny government knows best".

By cutting the government out of education, we'd save many many billions in unnecessary taxes.

What of parents who cannot afford to pay for their childrens education? Would this not spark a perputual spiral of poverty?

[benjamin_c]

the govenment does need revenue to run, and taxation is one of the possable solutions to provide this revenue, others would be using govenment money to invest in business. but in reality i beleive that some tax is necessary, but i think the tax system is for lack of a better word "F&%Ked up" there should be one fixed rate of tax, for example have a personal allowance of 10k per person or 20k for a married couple then anything over is taxed at X percent, maybe 25 or 30 %? and no national insurance, it should be compulsory to have health insurance, with the elderly being exempt along with the very young. the benefit system should be reformed to be a "loan" system thats limited to say 3 months then a weekely review after that and every purchase shoud be justified, "all reciepts kept" and they should be banned from using benefit money on non-essential items, (ciggaretts/alcohol) i accept the amount of admin this would take but it would make it harder for people just to sit on their lazy back sides expecting to be paid for by the hard working people. education should be free to everyone but school teachers should have more authority and children who dont follow the rules should go to military type boot camps until they learn respect, and in time this should build a stronger and more respectable society.
removal of stealth taxes, such as stamp duty, and have fixed rates for council tax, not all these stupid bands.

i know there are many other issues that need addressing but i have just mentioned the ones that have sprung to mind, the uk system is full of ambiguity and it needs to be simplified and be fairer to the deserving rather than those who don't contrubute!

[Zeno]

Anyone who tells you that a simpler tax regime will be fairer is either a lunatic or a liar.

The UK tax regime is very complicated but it is so for the most part in order to be fair (er).

It would be the simplest thing in the world to say all income taxed at 10% but this would not be any fairer - the lowest earners would pay far more and the highest earners far less.

[benjamin_c]

Anyone who tells you that a simpler tax regime will be fairer is either a lunatic or a liar.

The UK tax regime is very complicated but it is so for the most part in order to be fair (er).

It would be the simplest thing in the world to say all income taxed at 10% but this would not be any fairer - the lowest earners would pay far more and the highest earners far less.

The tiered system with 50% being the highest rate just seems to punish people who work hard to be a success in life, and forces many of them to use tax avoidance methods to avoid paying it anyway, and who can really blame them, we should be encouraging entrepreneurship as a country rather than punishing it with excessive taxation... the rate should never be above 30%

[David Griffiths]

I wasn't around at 18:15 - I didn't get home until 18:35, sorry.

I was around in the days of high direct taxation in the 1970s when what was then called the standard rate of tax was 8s/6d in the pound, then reducing to 7s/9d. That's 42.5% reduing to 38.75% for the standard rate, but there was a reduction on earnings of 2/9ths and the effective rate was about 35%. That's obviously pre decimal currency in 1971, and I didn't actually pay tax at those rates.

When the system changed in 1973, the standard rate was set at 35%. Higher rates of tax started at 40% and went up in 5% bands 45 -50 55 etc - 75 - 80 - 83. Why 83%? Because there was a surcharge in investment income of 15%, and if they'd stopped at 85% the full rate of tax would have been 100% :eek:

The higher rates were abolished from 45% upwards in one fell swoop in I think 1980. I thought at the time that it was a mistake because those people who had been paying 75% would have been quite happy with a top rate of 50%. Not like today. :p

One big problem, as I see it, is that back in 1973 if you became a higher rate tax payer, the levy went up from 35% to 40%. Now it doubles from 20% to 40% - that's a big leap.

The other is that the pre 1973 system took less of your money if you earned it - they charged more (15% more) on investment income above a certain level. Last time I worked it out I think that it was the equivalent of about £15000 of investment income at todays prices, but that's from memory.

These days, of course, the government charge less tax on investment income than it does on earnings. (It's called National Insurance, but that's a tax and nothing else) I think most people would think it fairer the other way round, if only because most people have earnings and don't have investments - see my comment in an earlier post. :)

Back before 1973 income tax was the main way that the government got paid but that year they introduced VAT, at 10%, and that's brought in a bigger and bigger slice of the national cake and it's been extended to take in more products than when it was introduced. But overall, tax on income hasn't gone down - it's 31% tax and NI these days, but the government raises more and more and more cash to spend - I'm not an economist and don't know what proportion of the total economy is from government spending but I'd bet it's far far more than 40 years ago, most of it on civil servants, quangos and little empires

There's a potted history of tax in recent years. I've always thought it inevitable that the higher rates would go back up, particularly under a Labour government. People have forgotten or never knew, the much higher rates that we had in the past,

Oh and as an aside there was once a proposal for a tax rate of 100% - it was called development land tax and was aimed at people who made money by changing use of land. If you got planning permission and turned your £1,000 an acre farm to £100,000 acre (or whatever) building land, the government would have all of the £99,000 profit. They very generously started the rate at 66%, and waited for the cash to roll in.

But it didn't - for fairly obvious reasons. Landowners said stuff that for a game of soldiers and didn't sell, leading to a shortage of development land. Can't remember if the government (Labour, obviously) backed down or simply got kicked out, but it didn't last too long.;)

[Cornish Steve]

What of parents who cannot afford to pay for their childrens education? Would this not spark a perputual spiral of poverty?
Let me answer the question with an anecdote. I've visited India many times, and you'll see plenty of slums with barefoot children running around flying kites or playing cricket with sticks and stones. On the other hand, I was once being driven past the world's largest slum (in Bombay). In front of us, a school bus stopped and a happy young girl, in school uniform and clutching a satchel, jumped from it and ran into the slum. Somewhere amongst the poverty, a family was sacrificing all they had to send their young daughter to school. They know that education breaks the cycle of poverty.

My parents sacrificed so I could have a good education. I sacrificed too, going without lunches at university so I could afford the necessary textbooks. Anything worth having is worth sacrificing for. We appreciate it more that way. When everything is an entitlement, fewer and fewer people care about meeting their responsibilities and a worrying percentage start to abuse the system.

If we abolished all government-run schools and replaced them with private schools, everyone would keep much more of their income (due to reduced taxes), so they could afford to pay the school fees. Today you're paying for your child's education; you just don't get to see how that tax money is spent. Because of greater efficiencies, you'd end up with more money in your pocket in the private school scenario - and you'd know exactly how the money is spent.

But what would happen if the parents of a hard-working child really could not afford one of the better schools? Support organisations would kick in - offering scholarships for children who maintain a certain grade. Family and neighbours would kick in, reviving the important link among community members. We really don't need the government taxing us to death and imposing its will on everyone. Let individuals sort things out for themselves.

It all comes down to a simple question: Could you do a better job than the government? Choose whatever you like: education, health, social services, police force, .... If your answer is "yes", that's the same as saying that a private company could do better. We're business folk here, right? You doing something better means a private company doing something better.

In another area: Could you earn a higher return on the money you give to the government for your retirement? What interest rate is the government giving you on that forced investment? Do you even know? What if you took the money instead and chose to invest it differently? Right now, the government steals it by force and wastes it on politically correct social programs and on entitlements to those with no intention of contributing to society. Do you think the government really cares how much money you get back? Is that fair?

Which reveals another point: The less money that goes to the government, the more transparent they tend to be when spending it. Right now, they are fat cats who can steal more from you at a moment's notice, so there's really no accountability.

[Cornish Steve]

And to answer Dan's original question :) : Taxation should be used to finance just those functions that only government can deliver. It should never become a social tool or an excuse for forcibly redistributing wealth.

[Cornish Steve]

It would be the simplest thing in the world to say all income taxed at 10% but this would not be any fairer - the lowest earners would pay far more and the highest earners far less.
How did you figure that one out? If you earn £50,000 and pay 10% in taxes, you contribute £5,000. If I earn £25,000 and pay 10% in taxes, I contribute £2,500. How can you say the lowest earners pay far more? If you earn twice as much as I do, you contribute twice as much in taxes.

The way it is now, the top 5% of earners contribute way more than 50% of taxes. How is that fair?

[directmarketingadvice]

Some decide to attract parents who want the best and decide to pay for the best teachers.

That's an incredibly simplistic view of things. It ignores the ability to pay and suggests "If you only chose to work a bit harder, then you'd have this benefit. The fact you don't have it means you don't really want it".

I agree 100% with Zeno that this just limits social mobility where most people born into poverty have an uphill struggle compared to those that happened to win the gene pool lottery and end up with affluent parents.

Steve

[dots and spots Jeff]

Recent research has shown that [Independent] schools can run counter to traditional supply and demand: a study was undertaken and it was found that the private schools with the lowest fees were those in areas with few/no competitors in their catchment area, whilst those schools with a cluster of competitors near by charged the highest fees.

It was realised that this was because the schools with immediate competitors were embarked in an 'arms race' of facilities: school A would build an olympic sized swimming pool to stand out over its competitors, so school B was forced to build a new theatre to attract pupils, school C built a new cricket pavillion and so - and how were all these paid for? by the parents in higher fees. Meanwhile, the school in the middle of nowhere, with no competitors, continued to provide an excellent education without the need for all these shiny new facilities and kept the fees to a level that (some!) parents could afford.

The cost of private education is staggering - circa £15K per year for a day child, £25 - £30K for a boarder. School fee inflation has risen at a level well above inflation for the last 10 years.

In a modern, developed country I think it would be wrong to not provide free education and free health care. Yes the private sector could provide efficiencies, but it would further marginalise those on the edges of society.

[benjamin_c]

grammar schools are the best option in my opinion, a fully privatised education system would be fundamentally wrong and limit social mobility but grammar schools reward academic ability as opposed to financial ability. cornish steve does speak a lot of sense though and i agree with his reasoning.

[Zeno]

How did you figure that one out? If you earn £50,000 and pay 10% in taxes, you contribute £5,000. If I earn £25,000 and pay 10% in taxes, I contribute £2,500. How can you say the lowest earners pay far more? If you earn twice as much as I do, you contribute twice as much in taxes.

The way it is now, the top 5% of earners contribute way more than 50% of taxes. How is that fair?

Say you earn £10,000 and lose 10% of it in tax. Leaves you with £9k at a level where every penny counts.

If you earn £100,000 the comparative effect after losing the £10k in tax taking you to £90k isn't that great. If you earn £1m you are still left with £900k.

At £10k, 10% is the difference between new shoes for the kids or eating this year. At £100k, it is one or two weeks in the Maldives this year.

In the UK at least, a flat rate tax system would almost denitely result in the lower earners paying more and the higher earner paying less.

[Cornish Steve]

In a modern, developed country I think it would be wrong to not provide free education and free health care.
Therein lies the fallacy: Education is not free. Health care is not free. We pay through the nose for highly inefficient and largely ineffective systems run by bureaucrats. When a service is paid for through taxes, the costs are hidden, the budgets are hidden, and the overheads are hidden. If you knew what the actual costs were, you'd probably be quite shocked.

Taxation means lack of accountability and lack of transparency - as well as government control over far too many aspects of our lives. When you the parent must pay, you make very sure that every penny is spent wisely because you now see it as your money. Costs are suddenly visible and transparent. It's the very same money - except that you're paying it directly to the school and not through government processing, with all its associated waste.

One other point: We should build systems based on the norm, not the exceptions. Yes, we must address the exceptions, such as a needy child whose parents genuinely cannot pay, but not at the expense of the big majority. Anyway, private foundations are a far better solution to funding exceptions.

[Zeno]

Just a word of warning Steve, but you do know what happened to Wesley Snipes when he thought he could pull the old "congress has no right to levy income taxes" argument?

[Cornish Steve]

Say you earn £10,000 and lose 10% of it in tax. Leaves you with £9k at a level where every penny counts.

If you earn £100,000 the comparative effect after losing the £10k in tax taking you to £90k isn't that great. If you earn £1m you are still left with £900k.

At £10k, 10% is the difference between new shoes for the kids or eating this year. At £100k, it is one or two weeks in the Maldives this year.

In the UK at least, a flat rate tax system would almost denitely result in the lower earners paying more and the higher earner paying less.
So let's just forget about hard work then. What's the point? I may as well laze around all day watching a big flat-screen TV since you want me to receive the same as the guy busting his gut and risking all on a small business. What kind of world would that be?

If individuals want to earn more, then it's their responsibility to learn sellable skills. I'm all for subsidized training, but I'm totally against the idea that we're all worth the same, regardless of effort and personal contribution. Why reward laziness and punish risk-taking and hard work?

I haven't worked 100 hours a week for five years, gone without holidays since I remember, and risked almost everything I have only for the government to steal my future earnings to pay those who simply made no effort during that time. It's basic risk versus reward.

[Zeno]

So let's just forget about hard work then. What's the point? I may as well laze around all day watching my big flat-screen TV since you want me to receive the same as the guy busting his gut and risking all on a small business. What kind of world would that be?

But there you go again assuming that the low earners are lazy and the high earners hard working/entreprenurial.

The low earner could be as busy as a one armed taxi driver with crabs but be getting no where with their business.

The high earner could be a trust fund baby sitting on an inheritance and living off the investment income (interest, dividends).

[Cornish Steve]

The high earner could be a trust fund baby sitting on an inheritance and living off the investment income (interest, dividends).
These are the wild exceptions and don't match reality. Most people I know who are well off are that way because they invested in a good education, worked hard, took risks, and made prudent decisions. For sure, some were just plain lucky. Some take risks and lose it all, but I can tell you they'd rather it be that way that simply be spoon-fed tripe from the government.

[directmarketingadvice]

Most people I know who are well off are that way because they invested in a good education

Don't you mean "their parents invested in a good education for them" or "they had the good fortune to be born in an upmarket neighbourhood where the schools were good"?

All that tends to take place BEFORE anyone gets to go to college or university.

(particularly in America)

Steve

[Cornish Steve]

Yes, you're right, Steve.

In my case, my wife and I went without a lot of things so our children could attend a private school and attend the best universities (and we have six children). It was a huge sacrifice - made worse by those who therefore assumed we were rich. Far from it: We simply chose different priorities. (Oh, and we moved to a district where there are good schools in driving distance, living in a smaller house to achieve that goal. Again, we made the choice.)

Still, even if we had not been supportive, they could have gone straight from school to a full-time job, attending college classes in the evenings. Many students around here do that, working 18 hours a day in order to better themselves. Hard work and commitment usually lead to success. If instead they had chosen to party all night and not bother with schooling, they'd pay the price later on. Most definitely, those who sacrifice and work hard should not be penalized in order to help the irresponsible. We should live by our own decisions in life and not expect the government to bail us out all the time.

[Zeno]

Yes, you're right, Steve.

In my case, my wife and I went without a lot of things so our children could attend a private school and attend the best universities (and we have six children). It was a huge sacrifice - made worse by those who therefore assumed we were rich. Far from it: We simply chose different priorities. (Oh, and we moved to a district where there are good schools in driving distance, living in a smaller house to achieve that goal. Again, we made the choice.)

Still, even if we had not been supportive, they could have gone straight from school to a full-time job, attending college classes in the evenings. Many students around here do that, working 18 hours a day in order to better themselves. Hard work and commitment usually lead to success. If instead they had chosen to party all night and not bother with schooling, they'd pay the price later on. Most definitely, those who sacrifice and work hard should not be penalized in order to help the irresponsible. We should live by our own decisions in life and not expect the government to bail us out all the time.

Sorry Steve, but I don't share your confidence in human nature. Have you seen the way that some children are treated by their parents? Do you honestly think that all of these people will sacrifice their booze & cigarettes to pay for their childrens' education?

You are judging the world by your own standards which unfortunately, not everybody shares.

[Cornish Steve]

I really don't see the difference. Today you pay for your child to go to school through taxes. The government processes the money, wastes a bundle on bureaucratic overhead, and then pays the school (and you don't even know how much). I'm simply suggesting that parents pay the school directly instead of through today's very round-about route. The schemes in place today to ensure that children go to school would remain in place. If parents spend the money on other things, that's no different from tax dodgers today, and they'd face the consequences.

Education is just one example. The same principle applies in every other area of spending. When we pay the money, we ensure that it's spent wisely. When the government spends it, they have no incentive to spend well. If they need more, they simply bump up the tax rate: no accountability and no visibility.

[Zeno]

So Steve. moving on I assume you oppose any sort of inheritance taxes too?

[KateCB]

Don't know about Steve Zeno but I certainly oppose inheritance taxes - if I work all my life and leave a nice sum and a house for the benefit of my children, after paying my taxes - the million of them it feels like - and my NI and my Council tax, and IP tax etc, why does my death then entitle the government to MORE tax from MY estate which is bought, paid for and taxed literalyl to death? What did they contribute to my life or death (except taking the tax money!) that entitles them to rob me after death and deprive my children of the things I worked so hard to ensure they had in the event of my death?

Now, I pay NI, not sure what for though - I have a private pension fund ( as advised by the government years ago), a private dentist (Simply because my dentist couldn't work under NHS schemes and went private) , private healthcare (I need treatment when I need it, not 8 months down the line)....just what is MY NI contribution doing for me?

The Robin Hood tax has its problems and I can see the bank employing 'transaction avoidence schemes' however IF they were honest enough to pay that 0.01% we could practically eradicate the national debt in 2 years, plus build up the pension funds for those people who have paid in for the last 30 years and are liable to get nothing in state pension as we pay 'state pensions' to people who have never worked and contributed to the British economy....

Its a big area; policed properly, its a good idea, one bad thing I see about it at the moment is its called a tax - it should be a 'transactional levy' or 'transactional contribution' and its about time the institutions that charge us £25 for sending a letter put something back - agreed they didn't all cause the financial problems the UK has, but as an industry they too need to be accountable - the ones that were in trouble had no problem accepting OUR money to bail them out did they?

[Cornish Steve]

So Steve. moving on I assume you oppose any sort of inheritance taxes too?
Let me ask you a question. You're a well-established member of these business forums, right, so you believe in entrepreneurial initiative, risk-taking, and hard work. Let's say that, after 30 years of hard work, and a lot of fun along the way, you retire having made a couple of million pounds. During the early years, your family went without holidays, your wife was stressed out because of your uncertain finances, and you did without most of the luxuries in life. Slowly but surely, as your business grew, you were able to step back a little, indulge in some new hobbies, and move into a new house. You're enjoying a comfortable retirement, and your children are now married and learning for themselves what real life is all about. You admit to spoiling your grandchildren a little in ways that you couldn't spoil your own children.

What right does the government have to now steal the money you earned in the form of inheritance tax? After sacrificing with you and supporting you as you worked hard and took risks, why should your children not benefit from the rewards of your labour when your life is over? Can you provide just one good reason why you should be taxed on something that's already been taxed and earned through your hard work? Just one?

[Cornish Steve]

I pay NI, not sure what for though
Once a year, the US government sends me a statement. It shows to the penny how much I've paid in Social Security (the equivalent of NI) and exactly how much I will receive if I retire at 60, 65, or 70. It's just like a bank statement: I paid the money into my account, I have a current balance, and I will be able to withdraw from it (pension, if you will) later in life.

Everyone in Britain should demand the same. It's your money, put aside compulsorily. It's not the government's money. How much is in your account? What interest rate are you earning? How much will you receive if you retire at 60, 65, or 70? It's not asking for much - just a proper accounting of OUR money.

[KateCB]

I agree Steve, and your post about inheritance tax mirrors mine - great minds and all that.....:)

[Zeno]

Let me ask you a question. You're a well-established member of these business forums, right, so you believe in entrepreneurial initiative, risk-taking, and hard work. Let's say that, after 30 years of hard work, and a lot of fun along the way, you retire having made a couple of million pounds. During the early years, your family went without holidays, your wife was stressed out because of your uncertain finances, and you did without most of the luxuries in life. Slowly but surely, as your business grew, you were able to step back a little, indulge in some new hobbies, and move into a new house. You're enjoying a comfortable retirement, and your children are now married and learning for themselves what real life is all about. You admit to spoiling your grandchildren a little in ways that you couldn't spoil your own children.

What right does the government have to now steal the money you earned in the form of inheritance tax? After sacrificing with you and supporting you as you worked hard and took risks, why should your children not benefit from the rewards of your labour when your life is over? Can you provide just one good reason why you should be taxed on something that's already been taxed and earned through your hard work? Just one?

I am not saying I fully agree with IHT both in principal and in practice without it, under your proposed system, the rich would stay rich and get richer while the poor get poorer.

The gulf between what each could afford would grow to the point of no social mobility at all.

[KateCB]

I don't like the idea of the 'poor' getting poorer, but if 'the rich' includes people like Steve and I who have worked hard (me after starting out in a council flat) to buy property and run a business for the benefit of our children, then yes, and I totally support that. My kids did without, I saw them very little when they were little as i was busy building a future for them.

I started a business with £300, I lived in a 1 bed council flat, and that £300 was my pittance of a redundancy pay - I WAS the 'poor' but I literally worked my way out of it - if I can do it, anyone can if they put their mind to it - I admit a certain amount of right place at right time does play its part but it truly is 99% perspiration - I have no O' levels, no A'levels, no degree so its not about education either.

Inherited wealth would be lovely and is a different scenario, but somewhere along the line (unless it was a £1 lottery win of course!) SOMEONE in their family, looking out for THEIR future worked hard to become 'rich' and therefore the same applies to them - why should they work hard, pay tax and then be penalised in tax for having achieved stability and perceived 'wealth' for their families?

Rich or poor doesn't come into it; to go back to the original question of the Robin Hood tax, I repeat - IF it were policed properly, both in its generation AND distribution, it would clear the national debt without putting the 'nationals' into more debt, it would boost the NHS, the education services and the pension funds - problem is finding someone honest enough, savvy enough and brave enough to actually be that Police.....I may apply.....:)

[benjamin_c]

inheritance tax = grave robbing!
and those who pay into private health, schools and pension should be exempt from NI
our government taxes us to death and is still in huge debt, they waste our money on stupid schemes that never work. lets hope the next government is better....

[DickM]

grammar schools are the best option in my opinion, a fully privatised education system would be fundamentally wrong and limit social mobility but grammar schools reward academic ability as opposed to financial ability. cornish steve does speak a lot of sense though and i agree with his reasoning.

It may be an interesting statistic, if we identified those amongst the contributors to this thread (which has pulled in quite a few other issues, along the way!), who attended grammar school via the 11 or old 13 plus route.
I did for one, and that later in life directly influenced where I lived as a potential parent - so that my future offsprings qualified to be in the catchment area of the better state schools.
Take the other option, then learn to defend your patch in the likes of Brixton - and that won't be with a pen or computer! School probably becoming a "secondary" priority to survival :(
On the tax front, progressively UK governments have lost their way to the point that you have Gordon Brown acting like a cockney street marketeer doing the Hokey Cokey, with putting his VAT rate in (@ 17.5%), then out (with 15%), then he shakes it all about! .......... and back with 17.5%. Yes! that's what it's all about! He's lost the plot, and no longer has a frigging clue :rolleyes:

[Cornish Steve]

It may be an interesting statistic, if we identified those amongst the contributors to this thread (which has pulled in quite a few other issues, along the way!), who attended grammar school via the 11 or old 13 plus route.

I went to a comprehensive school. Rumour had it that Oxbridge looked down on our school because the one guy who made it into Cambridge caused a lot of trouble. A big majority at school left at 16, and fewer than 20 of us continued to A-levels. Of that number, maybe half went to university.

Incidentally, one of those 20 who continued to A-levels was Ruth Langsford, the TV presenter. She used to take the school bus each day from Torpoint. I had no idea she was well-known until her name was mentioned here a few years ago. But that's another topic.

[englishbob]

Another tax idea based on envy and greed.
Its rubbish like the rest of them - and this government

[benjamin_c]

Another tax idea based on envy and greed.
Its rubbish like the rest of them - and this government

precisely! couldn't agree more

[semsley]

Perhaps we wouldn't need any more stealth taxes if money wasn't wasted in ways such as http://www.bradfordassembly.org.uk/ this. All these organisations/steering groups/forums are funded directly or indirectly by the government (you and me really 'cos the government has no money). Government gives a huge sum of money for its priority purposes to the Regional Development Agency (which has plush offices and hundreds of taxpayer paid for staff) this Agency then distributes the cash through various other agencies with the organisation at the grassroots level getting about 10% the rest going in the administration of the dosh to the hierarchy of these agencies each taking their cut to fund their offices and staff and the "events" at posh hotels including lunches where the strategies are discussed. Believe me in a previous incarnation I was the manager of a public sector training organisation and I attended these "events", listened to all the waffle, applied for the "commissioning" funds for which hoops had to be jumped through to "prove" the government priorities were being met, even if they weren't.

These things are going on in every region of the country the waste is phenomenal but how to stop it, I don't know, because none of the three main political parties would do it and with our current voting system there is no possibility of any party other than Lib/Lab/Con getting a foothold.

[Cornish Steve]

In the US, such a movement is called the Tea Party. It's drawing support from both of the major parties, and currently it has no real leadership. It's a grass roots movement centred around the ideas of much less government and far fewer taxes. It's reached the point where everyday people are saying "enough is enough". They have no idea how this will turn out, but it's already shocked and shaken the political establishment.