Friday, October 11, 2013

Green Ed’s Taxes are Officially Under Review

The Prime Minister’s official spokesperson has confirmed this morning that green subsidies on energy bills are now under review. Just yesterday Cameron said that those very same green subsidies were “necessary”A quick and welcome u-turn, even by Dave’s standards…

These taxes bump up gas and electricity bills by up to 9%. Without nationalisation government cannot dictate how energy companies are run, any more than it can dictate the price of oil. What it can do is ease the pressure for bill-payers right now by suspending Ed Miliband’s levy. This isn’t some notional freeze in the future, you don’t have to wait until 2015 to do this. The Tories should bin their commitment to these taxes right now, and let Ed be the one who pledges to increase energy prices at the next election should he want to bring them back. If Green Ed thinks there is a cost of living crisis, he should be big enough to admit the part he has played in it.

Monday, September 16, 2013

LibDems Will Put Up Taxes on Those Earning £50,000+

Most of the LibDem lines to take that were accidentally leaked to the press were pretty dull, yet their plans to put up taxes on anyone who earns more than £50,000 has piqued the attention of hacks. Especially given it will hit many senior political journalists. The memo points out:

‘We are looking at how the richest 10% of people, those earning over £50,000, could make a further contribution. The vast majority of people in the country would consider £50,000 a very large salary: these are not the middle income earners.’

That one could become an election issue…

Monday, September 2, 2013

Hodge Blames Gordon For Vodafone Tax Dodge

Margaret Hodge isn’t wasting any opportunity to bleat about the £84 billion Vodafone/Verizon deal today:

“We must demand reassurance that HMRC has thoroughly examined this proposition to ensure British taxpayers get their rightful share of this massive profit. If there’s a flaw in legislation it has to be urgently addressed by Treasury ministers. I don’t understand how anyone can justify such a massive windfall without handing a fair share to the Exchequer. If this is an instance in which Vodafone has simply played the system then clearly they themselves have an obligation to UK consumers, on whom they depend for their business, to do the right thing.”

Flaws in legislation, you say? Well the two companies are exploiting the so-called “Substantial Shareholder Exemption” loophole to legally dodge the tax, the very same loophole used by Guardian Media Group when it sold Autotrader. SSE is a corporation tax exemption for businesses disposing of a substantial shareholding in a part of their business. The idea is that businesses should be able to restructure their businesses without having to worry about chargeable gains implications. And who was it introduced by? One Gordon Brown…

UPDATE: That “flawed tax law” Hodge is complaining about? She voted for it.

Why Mansion Tax is Electoral Suicide

Knight Frank has crunched the numbers and calculated that to raise the target £2 billion, the mansion tax would have to start at £1.25 million, hitting 775,000 households. This would of course be levied overwhelmingly on London and the South East, 86.4% of the properties affected would fall in these areas. Calling it a “mansion” tax is grossly disingenuous too:  just 36% of these “mansions” are detached. 31% are terraced, 22% are flats and 11% semi-detached. Is a terraced house in Merton or Wandsworth, like the one above, really a mansion? 

The table below shows the top ten local authorities with the highest number of homes that would be affected by the mansion tax:

Click to enlarge.

If he has any sense Tory chairman Grant Shapps is right now crafting a mailshot to every single one of those 775,000 homeowners…

Wednesday, August 28, 2013

Tory Councillors Spend Taxpayer Money to Dodge Tax

Kent County Council has spent over £5,000 of taxpayers’ money on financial advisers in order to challenge an HMRC decision to tax their travel expenses. Tory council leader Paul Carter clearly really, really doesn’t want to have to pay tax on the expenses he claims for ferrying himself around Kent. So much so that he has even proposed a 47% increase on councillors’ mileage allowance. Well if you can’t abuse your position as a councillor to ensure you pay less tax, what’s the point?

Via Kent Online.

Friday, July 26, 2013

Labour Lessons in Reducing Your Tax Bill to Zero

KenCo “paid every pound of tax he is required to by law”, said Ed. Nothing wrong with the Labour leader’s own inheritance tax avoidance either. Nor the £210,000 tax dodge by the owners of the former Labour HQ. Not to mention the John Mills donation given to the party in shares to avoid a bill from the Exchequer. Or those clever little legacy schemes that help donors reduce their own inheritance tax bills. Now another perfectly legal means of avoiding tax: Labour has reduced its corporation tax bill from £561,000 to zero by offsetting expenses and previous tax losses. Despite a £2.8 million surplus. One for Margaret Hodge to investigate with her usual vigour…

Saturday, June 29, 2013

Does this Government Care About Middle Class Families?

Guido knew that the structure of marginal tax rates following a decade of Brown’s insidiously stealthy taxation and redistribution was malformed. How malformed was only driven home after reading a note from the Centre for Policy Studies. It is obscene how this government has punitively taxed the middle classes…

marginal-tax-rates

The CPS use a simple not atypical example of a married man with two children, who has no savings or investment income, and no student loans. Factoring in allowances and changes to child benefit, his marginal rates will be as above. A middle-class single income family with 2 children and the father earning £50,001 will have a marginal tax rate of 59.5%. You don’t have to be a fully paid-up member of the Taxpayers’ Alliance to think that is far too much.

Next year will be the thirtieth anniversary of Nigel Lawson’s 1984 Tax Reforms. George Osborne says he is Lawsonian, if the Chancellor wants a legacy and the gratitude of the electorate, simpler, flatter, fairer taxes would be the right thing to do. It might win back the middle classes at the ballot box as well…

Friday, June 21, 2013

Red-Faced Nigel’s Offshore Trust Fund

Nigel Farage has admitted he set up an offshore Isle of Man trust fund in 2003 for tax reasons. His accountants tell the Mirror he made no money from it though:

“It was a mistake for three reasons. Firstly, I’m not rich enough to need one and I am never going to be. Secondly, frankly, the world has changed. Things that we thought were absolutely fair practice 10 years, 20 years ago, 30 years ago aren’t any more. Thirdly, it was a mistake because it cost me money. I sent a cheque off to set it up.”

Though you can hardly say UKIP are in favour of anything other than lower tax bills, it’s tricky given Farage criticised the Isle of Man in particular in the EU parliament recently. He’s feeling the heat this morning. Welcome to big boys’ club…

UPDATE: Farage did have a go at the EU’s tax free salaries recently, though he defended the legality of tax havens and blamed high taxes for the need for tax havens. Not so hypocritical…

Wednesday, June 12, 2013

WATCH: Dave’s Tax Dodge Dishonesty

Brutal stuff from Dave on Labour’s tax avoiding donor:

“It is this government that is putting aggressive tax avoidance at the heart of the G8 agenda, and what do we hear this week from the Labour Party? They give tax avoidance advice to their donors.”

His bluster was the only highlight of a dull PMQs, though this is utterly dishonest from the PM. Miliband might be in hot water here, though the truth is that all parties offer tax avoidance advice to their donors, Labour, the LibDems and the Tories. As Guido reported last summer, Cameron’s own legacy scheme helps donors “reduce or even remove completely” the inheritance tax liability of rich Conservative backers.

All parties advise donors on how to avoid tax on their donations. Dave is in no position to take the moral high ground. 

Thursday, June 6, 2013

Labour Tax Dodge Could Pay For 70 A&E Nurses For a Year

Miliband’s tax dodge during the Q&A after his speech was nowhere near good enough to make the questions go away. Ed vows that the reason the Mills donation was made in shares is because “he wanted the Labour Party to have a steady stream of income which we will get from dividends”. When Mills himself was asked why he donated shares he said: “To be honest with you, it is the most tax efficient way of doing this. Labour has got people who deal with compliance and the legal side of all this. They are very sensitive nowadays”. One of them is lying.

The Telegraph’s accountants works out that had Mills chosen to make a donation of that size in cash, he would have had to pay £1.46 million to HMRC. Guido calculates that Labour’s efficiency trick has cost the Treasury enough money to pay for 70 A&E nurses for a year. What was that about an A&E crisis, Ed?

Tellingly it seems no Labour MPs are willing to come out and defend his position. Which reminds Guido of an anecdote shared by in house tax avoidance expert Margaret Hodge earlier this week:

“I have to share with you the classic email I had on one occasion, where I had to talk with Charlie Falconer about some shared responsibilities, and I got a speaking note from officials. It said:

“I’ve drafted up a one-page what-to-say and what-not-to-say. If there are any awkward, direct questions, it is entirely open to you to say “That’s a matter for you Lord Falconer”. You might be wise to do so. Sympathetic nods; “hmm”, “interesting” and “ah I see” are good too.”

So, I was well and truly told what was expected of me as a Minister.”

Would explain the silence from Labour MPs today. Perhaps Hodge can investigate…


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