Wednesday, December 9, 2009

We’ll Pay for Banker Bashing

As Alastair Darling prepares to deliver a kick in the bonuses to successful bankers, pause for thought.  As the bankers eye up properties in Zug and sunnier islands the tax burden falls heavier on those left behind.  The harder you squeeze high-earners, the more will leave these shores – the tax on the many is increased by the few who leave.  That is what happens when looters try to fleece the productive too much.

Bob Diamond, head of investment bank Barclays Capital,  warned yesterday that businesses and individuals could flee the City – “both financial capital and human capital are extremely mobile”.  Tory appeasement of City bashing will continue, led by the son of a son of a son of a stockbroker they stand on the sidelines for fear of being painted as friends of the City.  Guy Hands is just one high-profile tax exile, many more are fleeing the 50% tax rate.  We already seeing human capital flight…

UPDATE : How will the plan to tax bonuses cover the hedge fund community? It won’t is Guido’s guess, they are unregulated in the most and the capital is nominally held offshore. The hedgies in St James are the ones who take home 8-figure sums. Bankers and brokers will have to re-define bonuses as ‘profit shares’ and their limited partnerships as “mutual cooperatives”…

Tuesday, December 8, 2009

Hitting the Poorest Hardest with VAT Hikes

In the rush to talk tough on the deficit Alistair Darling is expected to announce an end to Labour’s limited-time-only 2.5% cut in VAT this year.  That means VAT will go back up to 17.5% or, if Darling’s feeling even more stern, to 20%. Since VAT is one of the most regressive taxes this gives the Tories a golden opportunity to shun a tax rise that hits the poorest, hardest.  The chart from the Taxpayers’ Alliance [pdf] shows that the poorest quintile pay over ¼ of their in indirect taxes, the richest only some 10%.

The Tories are refusing to rule out the same rise in VAT to 20%. That makes the Lib Dems the only party to promise substantial tax cuts with a plan to raise the income tax threshold to £10,000. If you are going to hit the low paid hardest with indirect taxes surely it makes sense to compensate them by raising the income tax threshold accordingly? Lower taxes for the low paid has got to be a vote winner.  In any event Guido has a suspicion that Darling’s PBR won’t schedule any rise until after the election…

Sunday, December 6, 2009

Public School Match

Marr was ridiculous in a very British right on way this morning.   Andrew Marr (old boy of Loretto, the very posh Scottish boarding school) asked Alastair Darling (another old boy of the £24,000-a-year school) whether it really matters that David Cameron went to a very posh English boarding school?

Marr asked Alastair Darling about the problems faced by the Tory Toffs, Dave and Zac, who according to the Prime Mentalist, devised their tax policies “on the playing fields of Eton”. “Tsk, tsk” the two old Lorettians tutted modestly about their young Etonian public school rivals. Guido wonders if these two posh members of the London based Scottish Raj acquired their shared policy outlook on the playing fields of Lorretto?

Sunday, November 22, 2009

+++ Jonah Curse : Jedward Out of X-Factor +++
+++ Tories Activate ‘Deadwood’ Digital Poster Campaign +++

The curse of Jonah Brown has reached the music world.  After firstly dismissing them as “not very good”, last week Gordon dithered and said he hoped freaky Irish twins Jedward did well. Of course their days were then numbered.

The Tories have just activated this campaign on digital poster sites around the country:

You don’t think that meeting between David Cameron and Simon Cowell last week was about more than Tickets for TroopsNo, they wouldn’t, would they?

Thursday, September 10, 2009

Duncan Redux

Tuesday’s media hit for Cameron was successful in obliterating from the front pages the speech given by Darling intended to revise the Labour Party’s Balls/Brown narrative on “Cuts v Spending”. It was by all accounts a very close run thing.

imagesHaving got wind of the expected Darling announcement there was a bit of flap at CCHQ.  Late on Monday afternoon CCHQ lined up party activists to be in the audience for a hastily arranged 11.00 the next day speech by Cameron focusing on the deliberately headline grabbing issue of cutting spending on politics.  That speech was originally not due to be given until a later date.  Alan Duncan however was an embarrassment that became pressing in the context of the brought forward speech, so he had to go, fast. The final decision to give him the bullet was made  there and then.

cam_breakfastResult: Cameron’s mere £120 million of promised cuts led the Ten O’Clock news and grabbed the front pages away from Darling’s in some ways far more fiscally significant change in direction of the spending supertanker.  Darling’s announcement was no match televisually for Sam Cam breakfasting with Nick Robinson. Cameron dominated the headlines and Darling’s major change of position was relegated to the inside pages and became the second story on BBC news.

Game, set and match to the Tory spin machine…

Monday, April 6, 2009

Even the Chancellor Cheats the Taxpayer

What hope is there when the Chancellor, who is responsible for the integrity of the public finances, is lining his pocket at the public’s expense?  In times gone by this would have been a resigning matter.  The Right “Honourable” Alistair Darling will no doubt tell us he has done nothing wrong.  Judge for yourself:

He has a choice of four homes; he is provided with two grace and favour homes at the public’s expense, he rents out his former private home (originally taxpayer funded) for his private profit and then he claims for his other home.   He has at  various times claimed that various houses were his main residence – in doing so he always maximised his claim for expenses.   Today he pays no housing expenses whatsoever out of his own pocket – anywhere – while the taxpayer pays for three properties for him and he rents out a fourth to make an extra profit. The condemnation is universal:

Last night, a spokeswoman for Mr Darling refused to comment on his expense claims. However, it previously emerged that until 2005 he claimed that a flat he shared with other Labour MPs was his “main home”. This allowed him to claim about £70,000 in expenses on his Edinburgh home where his wife and children lived.

It was then reported that he switched his formal declaration and told the Parliamentary authorities that the Edinburgh home was his main residence. This allowed him to claim for a London property and it is thought he bought a flat in the capital.

However, after becoming Chancellor in July 2007, Downing Street automatically became his main residence. It is thought that he then began claiming expenses again on the Edinburgh property and rented out the London home. In the 2007-08 financial year, Mr Darling claimed £9,837 in second-home expenses.

Mr Cameron said: “Given the state is effectively providing the minister with a second home, I can see no justification for them continuing to claim a second-home allowance. If elected I will make sure no Conservative minister with a grace-and-favour residence in London would be allowed to make a claim for a second home – including me.

“We have to sort this out now. No one will listen to politicians about anything if the impression is that they are living high on the hog off the back of taxpayers.”

Nick Clegg, the Liberal Democrat leader, said: ``It is clearly barmy for ministers to indulge in a form of double counting that enables them to enjoy two homes at the taxpayer’s expense.

“To say this is within the rules will only serve to convince the public that the rules are broken and need to be fixed as soon as possible.

Susie Squire of the Taxpayers’ Alliance added: “Alistair Darling has some serious questions to answer about his exploitation of the parliamentary allowances system. It’s very concerning that the man who is in charge of our money thinks it is appropriate to make a fast buck from the taxpayer. His behaviour is totally unacceptable.”

Go on, defend this Sir Michael White…

UPDATE : The London Evening Standard has discovered that Margaret Beckett is at it as well, she has three homes courtesy of the taxpayers.  Her caravan is (Guido believes) her own…

Thursday, January 8, 2009

Wheel Barrow Based Monetary Policy

Anatole Kaletsky, who incidentally has been telling his readers to buy shares for two years, has flipped. This morning he is calling on policy makers to Punish savers and make them spend money. He wants to tax savings.

He is not the only one, Rachel Reeves, former Bank of England economist turned Labour candidate for Leeds West, writes in the latest Fabian Review:

Print More Money
Quantitative easing, a radical policy option which was used in Japan in 2005 to end their 15 year recession, could be used now in the UK. Quantitative easing is a policy tool used when conventional monetary policy no longer works – as they nominal interest rate approaches zero. The Bank of England can either print more money or buy government and corporate debt so that long term interest rates fall. Quantitative easing is not without risks (it can push up inflation) but the potential benefits now outweigh these risks. Such a strategy is increasingly seen as a way to kick-start the economy and should be adopted.

Guido warned about the coming of Mugabinomics in November, when Gavyn Davies advocated a wheel barrow based monetary policy. What should you do in this situation? If you don’t have productive assets (such as being a business owner) exchange cash for hard assets, gold is the traditional refuge.

Sir Michael White sneered at Guido last year for telling co-conspirators to buy gold. In a period when stocks fell some 30%, sterling denominated investors who bought at the beginning of the year have seen it rise 41% from £424 to £599 an ounce today. If this year we see “quantitative easing” (printing money), holding gold will be insurance as much as an investment. The economic prospect is frightening, this isn’t about making a profit, it about holding on to what you have got…

Tuesday, November 25, 2008

+++ Labour’s 18.5% VAT for 2011 Tax Bomb +++ +++ Document Signed by Treasury Minister Stephen Timms +++

Monday, November 24, 2008

PBR Live Blog Here

Thursday, September 18, 2008

Perils of Tripartite Regulation

A co-conspirator points out just how brilliantly the tripartite authorities (HM Treasury, Bank of England and the Financial Services Authority) are doing joint up regulation.
Commenting on the soundness of HBOS the FSA yesterday morning said it was:

“a well-capitalised bank that continues to fund its business in a satisfactory way”

Alistair Darling this morning:

Alistair Darling added that without the deal the outlook was “very bleak indeed…We were onto their (HBOS’s) problem for several weeks. It didn’t just suddenly happen…”

So who was lying?

The architecture of City regulation is a mess. The FSA is despised and nobody in the City respects it. The Bank of England has been undermined deliberately by Gordon because it was a threat to his authority. The FSA should change remit and look after exclusively retail customer’s interests and the Bank should keep an eye on the City and re-take control of the Debt Management Office. The Treasury and the Bank should swap staff regularly and be on friendly terms, with the Treasury executing political influence through the Bank. The Bank is closer to the markets than the Treasury and so it should be to inspire confidence in the City…

Seen Elsewhere

5 Things We Learned From Guido’s Party | GQ
Revealed: Guido Fawkes Anniversary Dinner Guestlist | Peter Oborne
More Owen Jones Errors | Michael Ezra
Why Should Men Get Equal Maternity Leave? | Laura Keynes
Dentists Have Last Laugh Over Sneering Keynes | FT
Why’s Clegg Giving Men Paternity Leave? | Conservative Women
Cam Cannot Stem EU Immigration | David Keighley
9 Mansion Tax Questions for Ed Balls | TPA
Politicians are Lying to You About Immigration | Alex Wickham
Give Journalists Public Interest Defence in Law | Guardian
Cameron is Going to Have to Deal With UKIP | Dan Hodges


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Chris Bryant talks to the Times Diary about a famous gay actor:

“I don’t think I’ve had sex with him. He says we had sex in Clapham. I’m fairly certain I’ve never had sex south of the river”



Progressive Inclusion Champion says:

Great to hear Carswell call for inclusive policies and that UKIP must stand for first and second generation immigrants as much as the English.


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