Torsten Bell

Nothing wrong with income redistribution. It's a far more effective method of increasing growth and wellbeing than the current regime we have where the wealthy suck up all the money and leave very little for the rest of the population.

An opinion only. Like others have.
Always good to add more into the mix I think.

FriedGreenTomatoes2

Julian Jessop, an independent economist, said that Lady Shafik “has no business experience and little clout in the financial markets”.
“Shafik’s expertise is in the economics of developing countries, and she seems even keener on wealth taxes and income redistribution,” he said. “Her recent track record in leadership roles in academia suggests she has difficulty engaging with the challenges of the real world.” 🤷‍♀️

No idea who Julian Jessop is, so I Googled him. That sounds like sour grapes to me.

Hmm.

“I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
Winston S. Churchill

Julian Jessop, an independent economist, said that Lady Shafik “has no business experience and little clout in the financial markets”.
“Shafik’s expertise is in the economics of developing countries, and she seems even keener on wealth taxes and income redistribution,” he said. “Her recent track record in leadership roles in academia suggests she has difficulty engaging with the challenges of the real world.” 🤷‍♀️

Sir Keir Starmer’s new budget adviser has previously called for more wealth taxes on inheritance, land and property.

The Prime Minister has drafted in Minouche Shafik, a former deputy governor of the Bank of England, to take on a pivotal role in No 10.

Her appointment will fuel fears that Rachel Reeves will announce punishing tax rises on people’s assets in the autumn Budget.

Baroness Shafik, who sits as a cross-bench peer, has previously dismissed the idea of a link between hard work and success as “pernicious”.

She also co-chaired an inquiry set up by Torsten Bell, a Labour minister who is helping to write the next Budget, which called for a series of tax rises.

I knew his name as he is an new MP in nearby area and his name stood out at the last election. He does seem to have a solid background in the financial workings of government perhaps more so than RR. The only thing I thought after I watched the video was that he continually looked to his left as he was answering the questions, I have been led to believe it means you are telling lies or at least being dishonest.🙄

Doodledog

MaizieD

Well, you said I hadn't responded to your point about people paying more tax. I think you thought I'd made it more general.

But there's no need for us to fall out over it

No need to fall out at all, but I have looked back over the thread and can't see where I said you hadn't responded. All my comments have been to growstuff and were largely hypothetical anyway

Oh no! What have I said to upset you Doodledog? (I haven't read back.) I think we're actually saying more or less the same thing, so I hope we haven't fallen out.

The only point I've really been trying to make with Torsten Bell is that he's a policy person, not an economist.

The reason it's a bit personal to me is that my son has a degree in politics and economics and an MSc in Public Policy, When he signed up for the masters course, I hadn't a clue what it was all about, until he explained. He never talks about himself as an economist, even though much of his work now deals with financial spreadsheets.

What my son does (and I think Bell specialises in) is analysing data and comes up with results such a x group is benefiting more than y group - how can we make them both benefit equally (that's a bit simplified - but hope you get what I mean).

The Resolution Foundation has done loads of work and inequality, but it doesn't do the economics. It's consistent that families with children have become relatively poorer over the last 15 years or so (and I don't think those arguments can be refuted). It can highlight the effects legislation has had (sometimes unintended). It's made some suggestions, but it's never been its role to cost any solutions. Bell can tell Reeves that certain groups are worse off than others, but it's up to her and the Treasury to decide what to do about it.

PS. Not sure that makes sense, but I tried. Next time I see my son, I'll ask him of he can explain the difference between policy and economic roles better than I have.

MaizieD

Well, you said I hadn't responded to your point about people paying more tax. I think you thought I'd made it more general.

But there's no need for us to fall out over it

No need to fall out at all, but I have looked back over the thread and can't see where I said you hadn't responded. All my comments have been to growstuff and were largely hypothetical anyway

Thank you PN - that sounds interesting.

Sorry, should have said my post was in answer to Chocolatelovingran

I'm still trying to get more information about what is being suggested - that's all it is at the moment. But I can see some ways it could be more progressive if it replaced council tax for instance. Land could be taxed a different rates according to its use. So this could help say, the farmers. Land in use for farming could be at a very low rate. You could also have a negative rate if the goverment chose to use this a vehicle to help active farming.

But that's me wandering. I'll try and find some experts to help us

Referring to your post late yesterday, PN, I'd be quite comfortable with the Duke of Westminster paying the appropriate tax on his land in central London, although I'm not sure whether this is tax on his ( not inconsiderable) income, or something else.

Well, you said I hadn't responded to your point about people paying more tax. I think you thought I'd made it more general.

But there's no need for us to fall out over it

Oh God, I take it back!

I was simply responding to the idea that there was no argument against it by suggesting one that could be made. It is the reason given for people like doctors working part-time (that their earnings are highly taxed and they can't put more into pensions) so I could imagine it being used in the context of tax relief, although I agreed with you that equalisation would be fair.

Did I say you hadn't responded, Maisie? I don't think so, but in case I did and the post has vanished, I apologise for that, too.

People could argue (as they do when it comes to taxing wealth) that higher rate taxpayers pay more tax, so should get more tax relief.

I actually responded to that statement, Dd, even though you said that I didn't. Because it's an erroneous statement. Higher rate income tax payers don't pay more tax. Yes, they payer a larger amount, but as a percentage of their income from all sources it is usually considerably less than most other taxpayers (and by tax payers I mean all of us who pay taxes of any description).

So that argument doesn't wash.

sundowngirl

This from GB news today

Rachel Reeves has turned to Torsten Bell – yes, the same Torsten Bell who helped dream up Ed Miliband’s policies, including that ridiculous “EdStone”. He’s been around Labour politics for years, and now he’s helping shape their budget.

And what does he want? Higher taxes on your savings. New taxes on your pension. Even taxes on the inheritance you might want to leave your children. He’s talked about hitting family homes, slashing pension relief, hiking capital gains – the lot.

This is someone who’s never run a business, never had to worry about paying staff. Yet he’s being trusted with your financial future

It's all a bit worrying

What's worrying is that GBNews gets away with it.

Doodledog

growstuff

I'm a bit confused here Doodledog. What possible arguments are there against it? (genuine question - not trying to provoke)

The one I gave upthread. People could argue (as they do when it comes to taxing wealth) that higher rate taxpayers pay more tax, so should get more tax relief. I'm not saying I agree, just that as you said you couldn't think of a single argument against equalising tax relief this is one that I can well imagine being put forward.

Sorry, that's such a daft argument that I can't even see it making the starting block.

(But I take your point. You gave an argument - I just happen to think nobody would ever take it seriously.)

It's all a bit worrying

That it's from GB 'News' tells you everything. They mean it to be worrying.

^He’s talked about hitting family homes, slashing pension
relief, hiking capital gains^

It's all pure speculation.

This is someone who’s never run a business, never had to worry about paying staff. Yet he’s being trusted with your financial future

Well, for a start, a country is not a business and doesn't need to be run like one. But it might surprise you to know that the economists whose theories inform the way our economy is run have never run businesses, either. And their hold over the government is absolute.

growstuff

I'm a bit confused here Doodledog. What possible arguments are there against it? (genuine question - not trying to provoke)

The one I gave upthread. People could argue (as they do when it comes to taxing wealth) that higher rate taxpayers pay more tax, so should get more tax relief. I'm not saying I agree, just that as you said you couldn't think of a single argument against equalising tax relief this is one that I can well imagine being put forward.

This from GB news today

Rachel Reeves has turned to Torsten Bell – yes, the same Torsten Bell who helped dream up Ed Miliband’s policies, including that ridiculous “EdStone”. He’s been around Labour politics for years, and now he’s helping shape their budget.

And what does he want? Higher taxes on your savings. New taxes on your pension. Even taxes on the inheritance you might want to leave your children. He’s talked about hitting family homes, slashing pension relief, hiking capital gains – the lot.

This is someone who’s never run a business, never had to worry about paying staff. Yet he’s being trusted with your financial future

It's all a bit worrying

I'm a bit confused here Doodledog. What possible arguments are there against it? (genuine question - not trying to provoke)

growstuff

Doodledog

MaizieD

As a percentage of their income from all sources higher rate taxpayers don't ‘pay more’. In percentage terms they usually end up paying less. because of exemptions and allowances and different rates on different sources of income.

I thought we were talking about pension contributions from income tax.

We (or at least I was) talking about the fact that pension contributions are paid before income tax is deducted. Therefore, taxpayers are effectively receiving extra from the Treasury. This support is received at marginal rate, so taxpayers who pay 40% receive a much higher "subsidy" from the Treasury.

That's what I was talking about too, and as I said, I agree with you in principle. I was just offering a possible argument against it (that others might give).

growstuff

PoliticsNerd

One form of tax which would bring in billions to the Treasury is reducing the tax exemption on pension contributions to basic rate. I cannot think of one argument why it's fair for the Treasury to subsidise people with higher incomes more than they do those paying basic rate tax.

Agre growstuff. Would you include that in the tidying up of current taxes?

Why not? It would be far easier than a brand new tax like a wealth tax.

I'm not sure how it currently operates. Presumably HMRC is somehow linked to employers, who are told how much pension contribution to deduct and then work out the tax on the remainder. An adjustment would need to be made, so that all deductions only attracted 20% exemption. It can't be that difficult.

I was agreeing with you I was also referring back to what Torsten Bell (the topic of the thread) had said about the tidying up of current taxes.

That is going to be long term though, so a one-off wealth tax would help return some of the money to the government coffers (or computers) that was ladled out during Covid. The idea was the right one. But where is that money now? Do those who got it to help their business still have it? Do those who got is as income still have it? Do those who used it to offer cut price meals still have it? None of these people do. As always it "trickled" up to the extremely wealthy and it's time it was taken back and used - for children in particular. They are, in general, the ones who lost the most.

Actually, wealth does need to be taxed more highly, but not in the simple way people think.

I agree on both counts.

The problem with 'a wealth tax', or a 'land tax' is that both of them would be much harder to implement than people think. The wealthy are extremely good at arranging their assets in such a way as to make it difficult to pin down who owns them, using shell companies and trusts, for example.

There is also the problem of valuation of assets. How would share holdings be valued when share prices are subject to fluctuation all the time? How can land be valued? While development land and agricultural land might be relatively easy to value, what value would one put on a grouse moor ?

I think that the costs involved in establishing the 'wealth' to be taxed would considerably diminish the revenue that the tax might produce.

I think a better strategy is to work on restraining the acquisition of wealth rather than trying to tax it once it has accumulated.