Does May want to win?

[Newchodge]

Yes, because lowering the corporation tax rate was the right thing to do. The corporation tax rate has gradually reduced (and never been increased) for the past 60 years. Even Blair's Labour government didn't do that.

Just because it has always been done does not mean it is always the right thing to do. Lowering the tax rate while receiving more income is good. Maintaining the tax rate at a higher level does not mean there would have been a lower tax rate.

 

[Mr D]

You've never heard of the super wealthy stashing their money in tax havens? The additional money they have made because of the reduction in corporation tax, perhaps? Or by paying their workers in all those jobs they have created at starvation rates so they have to rely on state benefits in order to live?

The money in the tax havens is subject to local taxes. The money made because of the reduction in corporation tax is post tax money. And tax haven money is generally used to generate more money - investment I believe is the technical term. So rather different than stashing under the mattress. Then when the person dies it goes to whomever.

Paying workers puts money into circulation - don't think there is anywhere I know of that pays starvation wages plus the state provides benefits.

Care to name the country concerned? And why you think the government there does not apply a better wage as a requirement?

 

[Mr D]

Just because it has always been done does not mean it is always the right thing to do. Lowering the tax rate while receiving more income is good. Maintaining the tax rate at a higher level does not mean there would have been a lower tax rate.

True, because you maintain the tax rate at a higher level there would be no lower tax rate.
You have to lower the tax rate which means not maintaining it at the higher level.

 

[Newchodge]

Paying workers puts money into circulation - don't think there is anywhere I know of that pays starvation wages plus the state provides benefits.

Have you not noticed the millions of people in this country on minimum wage who have to get tax credits and housing benefits in order to live? If those benefits were not made available by the state those people would not be able to afford to eat, pay their rent and pay their bills. If they don't pay their rent they become homeless. If they don't pay their bills they can't cook or heat their homes, the rent and the bills tend to be set amounts, so the only choice they have in what to pay is food. That is starvation wages.

 

[Mr D]

Have you not noticed the millions of people in this country on minimum wage who have to get tax credits and housing benefits in order to live? If those benefits were not made available by the state those people would not be able to afford to eat, pay their rent and pay their bills. If they don't pay their rent they become homeless. If they don't pay their bills they can't cook or heat their homes, the rent and the bills tend to be set amounts, so the only choice they have in what to pay is food. That is starvation wages.

This country we don't have starvation wages. Name the country.

 

[Newchodge]

This country we don't have starvation wages. Name the country.

Repeating a denial while ignoring the argument does not get you very far.

Despite the state benefits that helps those on starvation wages survive there are also more than a million people needing to use foodbanks. In this country.

 

[Cobby]

n/a

 

[Cobby]

Have you not noticed the millions of people in this country on minimum wage who have to get tax credits and housing benefits in order to live? If those benefits were not made available by the state those people would not be able to afford to eat, pay their rent and pay their bills. If they don't pay their rent they become homeless. If they don't pay their bills they can't cook or heat their homes, the rent and the bills tend to be set amounts, so the only choice they have in what to pay is food. That is starvation wages.

It's also tantamount to government subsidising corporate profits.

 

[Ian J]

Despite the state benefits that helps those on starvation wages survive there are also more than a million people needing to use foodbanks. In this country.

Are there any accurate statistics about food bank usage as I'm sure that a lot of the media coverage is just spin.

According to the media loads of nurses are visiting food banks as they don't have enough money to feed themselves yet the Scottish nurse who claimed that she couldn't afford to eat was seen jetting off to New York and an article in Huffington Post used a single mother as an example stating:-

"Marina Down, a single mum studying nursing, told the People she was forced to visit a food bank to feed her young daughter.

The 23-year-old said: “That’s how desperate it can get. I’m very grateful for it but I’m a single mother trying to feed myself, my child, and give as much as possible to my patients. It’s not easy.”

Why was Marina Down not able to feed her daughter? Was it because she was a nurse on a low wage or was it because she was a single mother where the father of the child didn't contribute sufficiently.

I have a good friend who is a nurse living on her own in a rented house and running a brand new car which she changes every three years. She isn't exactly flush with cash but not starving either

 

[Mr D]

Repeating a denial while ignoring the argument does not get you very far.

Despite the state benefits that helps those on starvation wages survive there are also more than a million people needing to use foodbanks. In this country.

A million people? Or used a million times a year?
For 3 days food up to 3 times a year. Its really not solving problems - and we've had foodbanks in this country for at least 4 decades, possibly quite a bit longer.
People use them for various reasons - one being benefit delays. How does an employer paying the minimum wage set by the state cause benefit delays?

Stating that people are on starvation wages in Britain is rather overdramatic of you.
How much more in wages does someone get than those on benefits? Than those on pensions?
A full time job with national minimum wage for an over age 25 adult is over £200 a week. I know, my wife is one of them.
Rather more than starvation wages.

Now you can choose to pay higher wage but the government mandated minimum is set in law. If you feel that is not enough then campaign to have it higher. Perhaps £30 an hour would suit you? With a loaf of bread costing a fiver.

 

[Deleted member 59730]

No, you miss the point. The only thing that matters in our world is people (well, and animals). Whatever policies are followed if they don't benefit people, they fail. HOW to benefiit people is a different question, but a policy that disadvantages people and advantages something else has to be wrong. And any party that believes that people don't matter and something else matters more is a disgrace.

This country we don't have starvation wages. Name the country.

Amazon wages in the UK are subsidised to the tune of millions per warehouse via benefits.

 

[Deleted member 59730]

A full time job with national minimum wage for an over age 25 adult is over £200 a week. I know, my wife is one of them.
Rather more than starvation wages.

Rented accomodation here in Cornwall starts at £600 per month for really grotty places. Transport to work can easily take £50 per week. Please tell me that how someone is supposed to feed themselves on the £0 that is left.

 

[The Byre]

I am only going to intervene in this now rather pointless thread when someone makes a gross misstatement of fact -

The money in the tax havens is subject to local taxes. The money made because of the reduction in corporation tax is post tax money. And tax haven money is generally used to generate more money - investment I believe is the technical term. So rather different than stashing under the mattress.

There are trillions, possibly running into double figure trillions, sitting idle, sometimes being added to someones debt burden in the form of government bonds, but usually that are totally inactive.

Apple, Google, FaceBook and others have staggering sums 'parked' in the Bahamas and elsewhere that cannot be invested, because US corporation taxes are too high to be able to earn a long-term profit, but the US is the only country that has the infrastructure (e.g. a few hundred thousand English-speaking maths PhDs looking for a gig) to make the investment turkey fly.

We'll have to agree to disagree.

Much has been written over the years on the issue of equality vs growth and a lot of time and money has been invested in researching the subject. Books, theses and white papers have been written and it is far from a clear cut case one way or the other.

It is only unclear in the same way that evidence of global warming is unclear. It is unclear in the same way that evidence of evolution is unclear.

Political mumbo-jumbo is unclear - but any and every serious econometric study of countries that enjoy the same or very similar policies externally and are not subject to large-scale corruption or war comes to precisely the same conclusion.

• Poverty (higher Gini-index) reduces the overall level of GDP-per-capita.
• Education of all people increases it.
• Smaller size of country increases it.
• Taxation reduces it by increasing the cost of living.

These findings may not fit the myopic dogma of the left or the right, but them's the apples in the bowl - like 'em or lump 'em!

 

[Cobby]

Why was Marina Down not able to feed her daughter? Was it because she was a nurse on a low wage or was it because she was a single mother where the father of the child didn't contribute sufficiently.

It's quite reasonable to question the validity of the media's claims about foodbank usage, since the increase is, quite literally, incredible. Please don't do it with victim blaming.

 

[Mr D]

Amazon wages in the UK are subsidised to the tune of millions per warehouse via benefits.

Amazon pay well over £8 an hour for warehouse staff at Rugeley. More than the minimum wage - so more than what? 3 million plus workers get?
And more than thousands of businesses pay their workers.

So if paying over the minimum wage is a problem, is the benefits paid when it shouldn't be or should companies charge more for goods and services to pay unskilled work even higher?

So far we have both the biggest parties in this election who have promised higher minimum wage, not a lot of difference between the two of them on that score.

 

[Ian J]

It's quite reasonable to question the validity of the media's claims about foodbank usage, since the increase is, quite literally, incredible. Please don't do it with victim blaming.

Please do me the courtesy of ignoring my posts as I do yours

 

[Mr D]

It's quite reasonable to question the validity of the media's claims about foodbank usage, since the increase is, quite literally, incredible. Please don't do it with victim blaming.

The Trussell Trust - who should be in a position to know as they franchise many of the foodbanks - say around a million uses a year, with average use using them twice in a year.
So half a million people its being used for - they count 1 person with a family of 5 as 5 uses as they provide 3 days food then for 5.
So, 6 days food on average a year - and the numbers using the foodbank will be those on benefit, pensioners, low wages etc.
Been offered foodbank vouchers dozens of times because I'm disabled - I've no need to use the foodbank. My wife on minimum wage and me on below minimum wage (usually) do not need to use foodbank.

Back when I were a kid we had access to various things like several tins of corned beef, butter etc from the foodbanks in that era. Stuff given away to unemployed people - and my parents were at various times unemployed. How many people who were not on hunger strike starved in the 1980s?

 

[Mr D]

I am only going to intervene in this now rather pointless thread when someone makes a gross misstatement of fact -

There are trillions, possibly running into double figure trillions, sitting idle, sometimes being added to someones debt burden in the form of government bonds, but usually that are totally inactive.

Apple, Google, FaceBook and others have staggering sums 'parked' in the Bahamas and elsewhere that cannot be invested, because US corporation taxes are too high to be able to earn a long-term profit, but the US is the only country that has the infrastructure (e.g. a few hundred thousand English-speaking maths PhDs looking for a gig) to make the investment turkey fly.
QUOTE]



Think you will find when you look at what the companies are doing is that they are investing the money.
Look at the accounts, see the on hand cash rising so high with so much being stashed away? Yes, that's right, you don't see it. Because its being used - expansion is expensive and to bring it back into the US would cost them a chunk of that. More cost effective to expand operations, buy up companies, bring new products to market etc.
And look at where they are expanding - outside the US.

Money can be invested, just left alone its value falls due to inflation.

 

[Mr D]

Rented accomodation here in Cornwall starts at £600 per month for really grotty places. Transport to work can easily take £50 per week. Please tell me that how someone is supposed to feed themselves on the £0 that is left.

And you afford all that on basic benefit levels without getting a job?
How many businesses in Cornwall pay the minimum wage? If I look on the jobcentre website today will I find plenty of jobs advertised at NMW?

 

[Mr D]

It's also tantamount to government subsidising corporate profits.

Here is government subsidy. This is the report McDonnell refers to when he talks about Labour scrapping it.
Don't mind the maths.

http://speri.dept.shef.ac.uk/wp-con...er-24-The-British-Corporate-Welfare-State.pdf

 

[Cobby]

Amazon pay well over £8 an hour for warehouse staff at Rugeley. More than the minimum wage - so more than what? 3 million plus workers get?
And more than thousands of businesses pay their workers.

So if paying over the minimum wage is a problem, is the benefits paid when it shouldn't be or should companies charge more for goods and services to pay unskilled work even higher?

You seem to be dodging the point that there are people working full time jobs (sometimes also working part-time jobs as *well*) who do not earn enough to pay for their rent, bills and food. These people require benefit top ups to help them survive.

So if they are working full time, cannot afford to eat properly and require benefits, they are not being paid enough. No matter how you try to rephrase this, it remains true.

Please do me the courtesy of ignoring my posts as I do yours

That's not very helpful to the discussion. If you want your posts ignored, consider not posting them?

 

[Mr D]

You seem to be dodging the point that there are people working full time jobs (sometimes also working part-time jobs as *well*) who do not earn enough to pay for their rent, bills and food. These people require benefit top ups to help them survive.

So if they are working full time, cannot afford to eat properly and require benefits, they are not being paid enough. No matter how you try to rephrase this, it remains true.



That's not very helpful to the discussion. If you want your posts ignored, consider not posting them?

Is the fault of the companies that people cannot afford to pay bills? Or is it the bills? Or is the person responsible?
How can an unemployed person, a sick person, a pensioner on just state money, a few million people on minimum wage, self employed people, business people, those earning more than minimum wage and professionals all have the same problem with income when their income is so widely different?

If someone isn't being paid enough to cover their spending they change their income, change their spending or a mix of both.

Companies pay wages from their income. Increase the wages bill then income has to increase if all other factors remain the same. And if minimum wage increases more and more then it becomes much harder to find work paying more than it as it swallows up more and more jobs.
But because companies have to pay out more wages for the same work they put their prices up for all buyers - not just those who have had a pay increase.
If your benefit goes up by £2 a week but the cost of your food goes up £3 a week your costs are rising faster than your income....

 

[Newchodge]

Please do me the courtesy of ignoring my posts as I do yours

Please can you explain how this post to Cobby is 'ignoring his posts'? Responding to someone's posts, in whatever way, is not ignoring them. Please try to understand.

 

[Newchodge]

Is the fault of the companies that people cannot afford to pay bills? Or is it the bills? Or is the person responsible?
How can an unemployed person, a sick person, a pensioner on just state money, a few million people on minimum wage, self employed people, business people, those earning more than minimum wage and professionals all have the same problem with income when their income is so widely different?

If someone isn't being paid enough to cover their spending they change their income, change their spending or a mix of both.

Companies pay wages from their income. Increase the wages bill then income has to increase if all other factors remain the same. And if minimum wage increases more and more then it becomes much harder to find work paying more than it as it swallows up more and more jobs.
But because companies have to pay out more wages for the same work they put their prices up for all buyers - not just those who have had a pay increase.
If your benefit goes up by £2 a week but the cost of your food goes up £3 a week your costs are rising faster than your income....

PLEASE try to understand. The companies paying starvation wages are still making huge profits and paying large dividends to shareholders. They can do this only because the state subsidises their employees with tax credits and housing benefits. If these workers did not get state benefits they would starve. If the companies paid their workers enough to live on the shareholders would get less money in dividends and the companies would make lower profits and the taxpayer would be paying less to subsidise company profits. The companies would still make profits, the shareholders would still get dividends, but the levels would be lower.

Can you explain why this country's taxpayers should subsidise company profits and shareholder dividends?

 

[Ian J]

Please can you explain how this post to Cobby is 'ignoring his posts'? Responding to someone's posts, in whatever way, is not ignoring them. Please try to understand.

I was ignoring the content of the post and not the fact that he had posted. Please try to understand

 

[Mr D]

PLEASE try to understand. The companies paying starvation wages are still making huge profits and paying large dividends to shareholders. They can do this only because the state subsidises their employees with tax credits and housing benefits. If these workers did not get state benefits they would starve. If the companies paid their workers enough to live on the shareholders would get less money in dividends and the companies would make lower profits and the taxpayer would be paying less to subsidise company profits. The companies would still make profits, the shareholders would still get dividends, but the levels would be lower.

Can you explain why this country's taxpayers should subsidise company profits and shareholder dividends?

Again with the over dramatization.
Not starvation wages.

Huge profits? OK - then they can afford to expand / diversify / cover shortfalls in other years. If making huge profits then likely others will come along and get in on that game, taking custom.
Paying large dividends to shareholders? Great your pension fund can benefit - as can all those who own shares in the company. Usually not a massive pay out in dividend but it does add up over time.

The state is subsidising the company? Remove the state subsidy - the company will either adapt or not. The customers will pick up any shortfall the company gets to pay for.
Don't forget too - lower profits means lower corporation tax. Lower profits means lower dividends meaning lower dividend tax. So government gets to respond by taxing more elsewhere.

I posted a link to corporate subsidy research by Farnsworth earlier today. Read it.
That's what can be done with corporate subsidy. You just get to pay more as a customer.

A company three ways it can cover changes - charge customers more, reduce dividends to shareholders (and affecting pensions) and reduce pay rises to staff.

 

[Clinton]

It is only unclear in the same way that evidence of global warming is unclear. It is unclear in the same way that evidence of evolution is unclear.

You are wrong.

I appreciate that you did some research on this, but from the Guardian on the left [link] to the Telegraph on the right [link] to all kinds of highly respected educational institutions inbetween, inequality is not the problem. In fact, The Economist maintains that some inequality is needed to propel growth!

Even the OECD (and we know what the OECD is like!) only admits that there is a possibility that inequality can undermine growth.

Most academic research suggests some inequality is a good thing and, in fact, far from hampering growth, actually aids it.

 

[sirearl]

Don't forget too - lower profits means lower corporation tax. Lower profits means lower dividends meaning lower dividend tax.

Are you suggesting we abandon being a parasitical society and making everyone work,God forbid.

 

[Clinton]

PLEASE try to understand. The companies paying starvation wages are still making huge profits and paying large dividends to shareholders. They can do this only because the state subsidises their employees with tax credits and housing benefits. If these workers did not get state benefits they would starve.

So isn't the obvious solution that the state stops subsidising these companies?! We should remove the relevant state benefits and make these companies pay better salaries!

What am I missing?

The benefits system has become huge, cumbersome, unfair. The more complicated it gets the more opportunities it creates for fiddles and the more unintended consequences we end up with. For example, companies who would otherwise find UK labour too expensive are able to set up shop here because the government subsidises the work force. Make it uneconomical for them to operate in the UK by removing subsidies and forcing wage increases. They'll move out and be replaced by businesses that do pay a proper wage. But, importantly, the government won't be complicit in funnelling my tax dollars to these companies' offshore accounts.

 

[Deleted member 59730]

The state is subsidising the company? Remove the state subsidy - the company will either adapt or not. The customers will pick up any shortfall the company gets to pay for.

Yes, Remove permission to operate here. If Starbucks, who pay pitiful amounts of tax pack up and leave the UK consumers will still drink the same amount of coffee but bought from someone like Costa who pay their full share of tax.

Its not as if companies like Amazon and Google aren't replaceable by others with better ethics.

 

[The Byre]

• Poverty (higher Gini-index) reduces the overall level of GDP-per-capita.
• Education of all people increases it.
• Smaller size of country increases it.
• Taxation reduces it by increasing the cost of living.

Does not conflict with

from the Guardian on the left [link] to the Telegraph on the right [link] to all kinds of highly respected educational institutions inbetween, inequality is not the problem. In fact, The Economist maintains that some inequality is needed to propel growth!
Even the OECD (and we know what the OECD is like!) only admits that there is a possibility that inequality can undermine growth.
Most academic research suggests some inequality is a good thing and, in fact, far from hampering growth, actually aids it.

 

[Scott-Copywriter]

Just because it has always been done does not mean it is always the right thing to do. Lowering the tax rate while receiving more income is good. Maintaining the tax rate at a higher level does not mean there would have been a lower tax rate.

This has been studied by economists for decades. The overwhelming consensus is that lowering corporate tax has a positive effect on economic growth, employment and wages.

Look, I do understand your preference of prioritising the people, but this is exactly what it does. I'm not saying this because I think it's better for businesses. It directly impacts people as well. If you increase the corporate tax rate and (possibly) make more in tax receipts, there's a huge risk of companies responding by reducing expenses (wages and staff) and increasing income (higher prices).

And I say possibly because, if the UK tax rate becomes less competitive, it can drive company HQs to more favourable countries where we get none of the tax at all. We could easily end up taking a bigger chunk of a smaller amount.

You may think this is unlikely to happen, but with a hike of this magnitude, many companies will lose out to the tune of hundreds of millions. It would therefore make perfect monetary sense to utilise cost-cutting measures, including the possibility of shifting base operations elsewhere. Even with the cost of the upheaval, they could be better off within a year.

It's human behaviour 101. When you're suddenly making less money, you adapt, and not in a way which is good for the millions of working people across the UK.

One important point, however, is that the effectiveness of corporate tax reductions is based heavily on relevance to other countries. It's not arbitrary. How low the rate should go depends on how competitive other tax rates are across the world.

This is why I believe that 19% is sufficiently low and that it shouldn't go to 17%. It's competitive enough and will attract more business and investment to the UK.

But one thing this proposed tax rise is guaranteed to do is to make the UK far less appealing for inwards investment and new companies. It makes the situation of the job creators, product suppliers and service suppliers more difficult. It creates an unfavourable environment for expansion and investment.

And this is made far worse by the situation of increasing the rate from its current low. Are businesses just going to sit by and see their net profit dwindle without action when they have shareholders and investors to please? Not a chance. Axes will start to fall.

The Institute for Fiscal Studies has it spot on. Taxes are paid by people. Increase the rate, and when all is said and done, it's the people who will bear the burden.

I share the exact same concerns about you regarding ordinary people. This is why I'm so concerned about this proposal. It's going to make people worse off.

 

[Clinton]

@The Byre

Yes, but you were disputing this statement of mine:

"I'm not a big fan of greater equality .... nor do I subscribe to the view that it inevitably and always leads to growth."

So, back to the point, greater equality does not inevitably lead to growth. In fact, it's probably inequality wot does it.

 

[Newchodge]

So isn't the obvious solution that the state stops subsidising these companies?! We should remove the relevant state benefits and make these companies pay better salaries!

What am I missing.

You are missing the point. THAT IS MY POINT. Companies need to be made to pay salaries that allow their staff to live. But it has to be the other way around from what you describe - you cannot remove benefits before making companies pay living wages. Removing benefits first will eresult in unacceptable hardship for people.

 

[Newchodge]

Lower profits means lower dividends meaning lower dividend tax.

Lower dividend tax? When did dividend tax come in? The UK has not yet seen ANY dividend tax yet, so nothing can lower it.

 

[Clinton]

Removing benefits first will eresult in unacceptable hardship for people.

Agreed.

So is it Labour's position to aim for this i.e. to aim for an eventual removal of those benefits which are just subsidising cheap labour?

Somehow I think not. Labour seem to love having a massive and complicated benefit system in place.

 

[Newchodge]

Agreed.

So is it Labour's position to aim for this i.e. to aim for an eventual removal of those benefits which are just subsidising cheap labour?

Somehow I think not. Labour seem to love having a massive and complicated benefit system in place.

As far as I am aware it is not a specific part of any party's policy, but raising the minimum wage to £10, which is Labour policy, will take people out of in-work benefits, by definition.

 

[Clinton]

As far as I am aware it is not a specific part of any party's policy, but raising the minimum wage to £10, which is Labour policy, will take people out of in-work benefits, by definition.

Great.

And Labour will then revamp the benefits system to stop offering benefits that subsidise cheap labour?

 

[Newchodge]

Great.

And Labour will then revamp the benefits system to stop offering benefits that subsidise cheap labour?

Don't you understand how the in-work benefit system works? It is based on the claimant's income. If the claimant's income rises to a certain point they lose their right to benefit. No need to revamp the benefit system to achieve that.

 

[Mr D]

Lower dividend tax? When did dividend tax come in? The UK has not yet seen ANY dividend tax yet, so nothing can lower it.

You may not have paid taxes on dividends, other people have and for some years. You know, completing tax returns etc?