Maybe I am misinterpreting it, but is there not a vast increase in taxation for the middle classes in HM Government’s legislative programme? Mysteriously it was one of those measures left out of the Queen’s Speech, but there it is, plainly, in the list of Bills:
National Insurance Contributions Bill
Would harmonise the upper earnings limit (UEL) for national insurance contributions with the higher rate income tax threshold. The UEL will rise in phases, to match the higher rate income tax threshold by April 2009. The measure would extend across the UK.
Since this will not be part of the Finance Bill, either, so not caught by the media feeding frenzy round The Budget, when will it be covered? But it is a rise in the marginal income tax rate for the employed middle classes of 10% (or 20% if you look at the impact on their employers wages bill, which really determines what they can get paid). Since there are no other details currently, who knows what other effects on other groups might be?
It is a classic example of the bureaucratic governmental stealth technique. Announce things nominally openly but in circumstances when you hope no-one will pay any attention. Execute them in silence, by stages, as if inevitable, to minimise resistance. If people later squawk at all, they can be told, “It was announced; there was a consultation; the vast majority of consultation responses were favourable; it went through parliament where there was an opportunity* for debate; it is now the democratically decided law.”
The only cure for this is media attention. Where are the Capitoline geese?
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* Of course there is always opportunity for debate in Parliament, but since 1997 the Party has steadily, increasingly, chosen to restrict debate.
The sooner that NI is re-named as a tax, the better; this is not insurance – there is not investable fund of assets; it is little more than a Ponzi scheme.
Wasn’t this tax hike identified by the Daily Telegraph a few days after the pre-budget report recently?
As usual, of course, the government never announced it openly.
The sooner it is scrapped more like. I temped at their spectacular bureaucracy once. It is truly pathetic that we have two income tax systems rather than one purely in an attempt to pull the wool over our eyes. Leaving aside the whole issue of the overall rate of taxation for a moment, surely mere administrative efficiency would dictate such a move?
Even the original conception – a sort of compulsory friendly society – is a bit demented: “Let’s protect folk against unemployment by taxing companies for employing people”.
After the 2p income tax cut and abolition of 10p starting rate this NI change was the most talked about element of Gordo’s last budget. While not hailed from the rooftops by nuLab it did help fill the Budget supplements in March.
FT Weekend money section had a nice graph explaining the winners and losers a couple of weeks ago to accompany this article:
http://www.ft.com/cms/s/0/eeb337bc-83b2-11dc-a0a6-0000779fd2ac.html
Roughly: those on 15-20K lose thanks to the abolition of 10p starting rate. Folk on 35K-45K lose due to the NI changes.
I don’t know anything about the site, but it’s also covered here.
The article also mentions plans to start taking money for a second state pension from 2012. Odd really, considering how well the first one worked…
Yes Guy.
The government is YET AGAIN increasing taxation.
Mr Brown has raised many taxes – and he normally does not announce it.
For example, budget speeches leave out the most important parts of budgets. And Treasury documents have become glossy things full of pictures of happy families benefiting from government policies – not the boring fact filled publications they once were.
“But why does not the media expose all this”.
Partly leftism.
Even the Telegraph group has many journalists who are influnced by “modern”, “progressive” ideas (after all they did not go to university on Mars they went to colleges in this world, i.e. colleges dominated by such a view of the world – and the days of non college boy journalists are over, men like Frank Johnson would be confined to cleaning the toilets these days).
And partly lazyness.
As Christopher Booker often points out – most modern journalists do not research stories, they just rehash press handouts.
Still you know all the above.
So far the government’s line, that no one will lose out in cash terms because the extra NI will be offset by the cut in the basic rate from 22% to 20% and the projected increase in the 40% tax threshold, seems to be holding. It seems to me that the pitfall awaiting the government is the fact that employee pension contributions do not enjoy the relief from NI that they do from tax. This means that the credit side of the balance may turn out to be illusory for an uncomfortably large number of politically important voters when the new tax year starts next April.
I might be more likely to believe the government line on the Payroll Tax if they had not lied over the recent plans for Capital Gains Tax.
The offical line (faithfully reproduced by the morons at the “Economist”) was that the plans did not mean an tax increase at all – that there would be “many winners” (words directly used by the “Economist” without even quotation marks) and so on.
We are also being told that the E.U. Constitution does not really give more power to the E.U. (another lie faithfully supported by the “Economist” even whilst they say there should be a vote on the E.U. Constitution anyway).
No surprise to learn that this week’s edition of the Economist (thank you Kettering library) publishes two pro E.U. letters (no anti E.U. letters) pointing out that the position of the Economist is contradictory – if the “treaty” does not give the E.U. much new power there is no point in having a vote on it.
Which is, of course, the position the Economist staff wanted people to draw from their “pro” vote on the E.U. Constitution line.
There was also a letter denoucing deregulation (blaming lack of regulations for problems with toys in the United States – in reality the toys that are a danger are imported from China and they are imported in part because regulations helped break domestic manufacturing, so the proplem is the exact opposite of what the letter claims it is) in response to an Economist article that supposedly was anti regulation
Almost (but not quite) needless to say the article stated that it was not possible to know if regulations were increasing in the United States (they could look at the size of the Federal Register – but I suppose that is beyond them) and that regulations would only be a real threat if there were far worse than they are now (totally false, regualtions in the United States do vast harm already).
There is a system here and it goes all the way back to J.S. Mill.
A “pro freedom” position that (when one looks closely) is not one – indeed it is a position that leads, and is meant to lead, to a bigger not a smaller government.
One of my pet hates in college days.
“But we are not biased – we teach Mill as well as Marx”.
So as well as teaching someone who supported the Labour Theory of Value and who wanted government to control the economy (although he renamed government the working class, or the people, or whatever)……
You also teach someone who supported the Labour Theory of Value (indeed brought it back from the dead – this theory had hardly any supporters left in Britian by 1830 – J.S. Mill made it the main theory again till at least the 1870’s) and supported more government for just about everything (and claimed that “everyone” agreed with this or that bit of more statism), whilst saying that he was greatest defender of freedom in the world.
Setting oneself up as the great defender of freedom, whilst really undermining it – that is the Economist way.
So that people can say “I have read both sides – I read the left stuff, but I also read the Economist”.
And the conclusion they will draw from this reading of “both sides” will be a statist one (on most things).
“To control totally, one must also control the opposition”.
And the Economist is seen as the free market opposition to big government.
Still I doubt it is a formal plot (like all the Marxists who were found to be working for the Financial Times some years ago) – it is a “natural” thing, the people who go to work for the Economist went to university, and they were “good students” – i.e. they accepted every piece of shit they were taught.