Paying for Social Care

Thank you for explaining the difference Pippa. I do know but had forgotten about the differences probably because I’m unlikely to ever have to pay Capital Gains Tax as whilst we’re comfortable enough, we’re a long way off rich, even with our house.

We were both teachers so have a teacher’s pension each, mine not very big, and the only property we own is our house. Not rich but comfortable in retirement. I think there must be millions like us.

PippaZ

I have just had a "moment" realising what a stupid name Value Added Tax is for what is essentially a Sales or Purchase Tax.

It's called Value Added Tax because it is charged all the way along the process of making an item on the premise that value that has been added at each stage. Every time it's sold on the seller has to be charged VAT. Businesses are able to claim some of the VAT they've paid to their suppliers back (or deduct it from the VAT they've received before they pay it to HMRC) Consumers aren't. It's a very odd tax, really...

Sorry, the buyer has to be charged VAT. (I think I meant to say the the seller has to charge it)

Really should proof read before posting, not after.

Aveline

As we all have differing amounts of assets including none at all, and none of us knows how much care we might or might not need, then surely this is an insurance matter? A different form of national insurance with premiums based on taxable income could iron out some of the complexity?

That's how you end up with a predatory two tier health service, surely? Like the USA.

NI is called that because that was the original intention of the tax, it was meant as insurance. But the originators of the NHS forgot about the current, non insured, crop of retirees whose care had to be provided. Instead of allocating a one off sum for that, they just used the NI money from the working population to make up the shortfall. But it's completely meaningless now.

You are right; it is more complicated. However, you could call it a Sales or Purchase Tax and still have the same complications. I can't see why we call it "Value Added" when I buy something and pay my 20% it seems more like value taken away

Sorry, I have miss a lot of posts doing something having half written the above and the finishing it and posting. I will read them now.

….I buy something and pay my 20% it seems more like value taken away.

PippaZ

You are right; it is more complicated. However, you could call it a Sales or Purchase Tax and still have the same complications. I can't see why we call it "Value Added" when I buy something and pay my 20% it seems more like value taken away

Because it's the difference between the purchase and sales price for the retailer - ie. the value which has been added. (But I'm sure you knew that really.)

MaizieD I said a different form of insurance. Nothing to do with current NI. This is an actuarial rather than political point.

foxie48

Maddyone a buyer is taxed on the value of the house but the owner is not taxed on the increase in value and I am sorry to disagree but most people's wealth is in their home. Your house might not be worth a £1m but plenty of people have homes well in excess of this.

Agreed.

Doodledog

If you think that this country has ever been run as a meritocracy, you have a very different perspective from mine.

No, I don't. Please stop assuming things I have not written.

foxie48 I agree with your post of Wed 15-Sep-21 19:25:03 too, so I won't repeat what you've written.

I agree with Maizie though Aveline unless you are saying it should be another (more) progressive tax called "insurance" and paying for equal care - physical, mental and social - for all.

If it is worked as private insurance is, it would be hived off as a private insurance denying the whole basis of the National Health Service.

Aveline

As we all have differing amounts of assets including none at all, and none of us knows how much care we might or might not need, then surely this is an insurance matter? A different form of national insurance with premiums based on taxable income could iron out some of the complexity?

Income is easy to "hide" if you don't pay PAYE.

There are also people who, on paper, have no income but have considerable assets. My ex was one of those, so I have an idea how it works.

There are also people who don't have work in a paid job and, therefore, might have no income but live off (for example) inherited wealth or a partner.

That's why there need to be other taxes besides income tax.

Oh, for goodness sake.

We disagree over who should pay for care that neither of us may ever need. That's all.

There is really no need to snipe quite so consistently. I have lost count of the times that you have wilfully or accidentally misunderstood my posts and attributed motives that are not there, but I have remained polite when have sighed and countered them as patiently as I know how. I haven't accused you of not 'doing' details or of not using 'joined up thinking', just because you have a different point of view.

You did ask (from memory) 'what happened to meritocracy?' It is not an unreasonable assumption to take from this that you feel that it existed once - if not, how could anything have happened to it?

Sorry - that was to growstuff wrt her comment that I was misinterpreting her comments - specifically about meritocracy, and implicitly about other things.

Hetty58 BUPA and others chucking people out has been the case for many years. I remember in the late 70s auditing a private hospital that had a geriatric wing. The insurers set a limit of 10 weeks for private care and then off to the council home.

Doodledog

Oh, for goodness sake.

We disagree over who should pay for care that neither of us may ever need. That's all.

There is really no need to snipe quite so consistently. I have lost count of the times that you have wilfully or accidentally misunderstood my posts and attributed motives that are not there, but I have remained polite when have sighed and countered them as patiently as I know how. I haven't accused you of not 'doing' details or of not using 'joined up thinking', just because you have a different point of view.

You did ask (from memory) 'what happened to meritocracy?' It is not an unreasonable assumption to take from this that you feel that it existed once - if not, how could anything have happened to it?

I'm sure you know what is often said about people who assume.

foxie48

PippaZ

I have just had a "moment" realising what a stupid name Value Added Tax is for what is essentially a Sales or Purchase Tax.

But it's a bit more complicated than that because if you are a business person buying something for use in the running of that business and are VAT registered, then you can claim the VAT back so it's not levied equally across the board. I have to employ contractors to keep my paddocks in order and pay 20% more than my neighbours for the same work because they run a business. I'm not complaining btw just pointing out a difference.

Presumably if your neighbours are running a business they will be charging VAT on the fees or sales and so will be paying over the the difference to HMRC. Hence Value Added.

I'm sure you know what is often said about people who assume.

That they are working with the information in front of them?

Ok, if I got it wrong, what did you mean by the question? I can't find another way of reading it.

Do people see VAT as a progressive or regressive tax?

I tend to see it as regressive, on the grounds that it is a fixed rate, so more expensive for those on low incomes, but I have seen it described as progressive, as tax on purchases of non-essential items makes up a smaller proportion of a lower salary than a high one.

That seems, to me, a bit of a double whammy, though - 'Oh well, maybe you can't afford to buy these things, but at least not doing so reduces your tax bill.'

they charged vat on tampons and sanitary towels for years - luckily that has gone!

Yes, when it came out it was meant to be just for actual luxuries, wasn't it? So chocolate biscuits were taxed and rich tea not - that sort of thing.

Now it seems that most things attract VAT - and yes, Sanpro is hardly a luxury by most women's standards ?

Just looking at the responses to this thread highlights how impossible it is to find an equitable or even a reasonable way to fund long term care.
No wonder it's never been done up till now.
Standards and expectations of care have increased just as treatment options have proliferated in NHS. eg my grandmother was in a shared room with a communal bathroom in the care home she was in years ago. It was was no big deal at the time and pretty common. Nowadays single en suite rooms with smart TVs are expected. What will be next? This is an honest enquiry. I don't know what to expect when my time for care comes. If it comes...