Torsten Bell

Maizie Although Wiki describes Bell as an economist, as far as I can see he's never worked as an economist, but in policy. He produces the data which shows, for example, which groups have benefited least over the last 15 years. He believes in greater equality and makes the case for greater fairness, but leaves it up to others to find solutions.

Allira

Oh come on, it's easy to Google!

Taxation is his area of expertise!

No, it isn't. Policy is.

He's certainly on to a loser. On the one hand a neo-liberal, on the other I've just seen the following on Twitter: "spoken like a true Communist". Ah well! The public always speaks "common sense"

He’s a neo-liberal conservative communist then growstuff, the best and worst of men all rolled into one - truly a man of the moment.

I am neither an economist nor a politician, as is obvious from my posts, but how can low taxes in a low wage economy possibly work? People seem to prefer income tax to general taxation, but wages have fallen in the UK, and a combination of demographic changes and increasing numbers of people not working because of illness means that the tax burden is falling on fewer and fewer people, many of whom are struggling financially already. We need a radical shift in the tax system.

I haven't watched the video (I struggle to do so as it would disturb Mr Dog), but will try to watch it tomorrow when he's not here.

I agree with GG13 👍🏻

Casdon

He’s a neo-liberal conservative communist then growstuff, the best and worst of men all rolled into one - truly a man of the moment.

Obviously a mixed-up whizz kid!
😀

Doodledog

I am neither an economist nor a politician, as is obvious from my posts, but how can low taxes in a low wage economy possibly work? People seem to prefer income tax to general taxation, but wages have fallen in the UK, and a combination of demographic changes and increasing numbers of people not working because of illness means that the tax burden is falling on fewer and fewer people, many of whom are struggling financially already. We need a radical shift in the tax system.

I haven't watched the video (I struggle to do so as it would disturb Mr Dog), but will try to watch it tomorrow when he's not here.

I'm not sure what you mean by general taxation.

Last time I looked income tax only accounted for about 25% of the Treasury's income.

There are many other forms of taxation. All of them affect different demographics.

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.

There are others.

I suppose the argument would be that higher rate taxpayers already pay more, and when people reach the additional rate they often stop full-time working as they can’t divert money into pensions? I agree with you in principle though.

I know there are other forms of taxation, but they have been called ‘sneaky’ on this thread alone, and on others people have said it is ‘obviously’ income tax that should rise. FEIW I disagree, as taxing people who are contributing goods and services and not those who do neither doesn’t seem fair. VAT is tax, but I don’t think it applies to someone spending money someone else has earned. If you give me the money to pick up something for you while I’m at the shops, you pay the tax on it, not me.

I didn’t say that Bell is an economist, growstuff, just that he's like all the rest in perpetrating the myth that taxation funds spending, and the national budget is like a household budget.

Additionally the Treasury seems to be well aligned to neoliberal economic beliefs and that will never lead to progressive taxation and a more equable distribution of the national wealth, however earnestly MPs may express a desire to do more for the disadvantaged.

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.

In his book "Great Britain?" he is almost annoyingly positive. On Wealth Taxes he seems to feel that making the wealth taxes we already have work is a better place to start. I totally agree with this but also believe a one off wealth tax (remembering exactly who the wealthy are) would help boost growth.

I've also found an article where he mention Land Tax but doesn't seem keen. (It was written some time ago so he may have changed his mind).

I've heard quite a bit about them recently, generally starting with conversion of Council Tax to a land tax but eventually ensuring those like the Duke of Westminster pay a realistic tax on the land they own in Central London.

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?

Someone/thing stole and "e"!

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.

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.

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.

MaizieD

I didn’t say that Bell is an economist, growstuff, just that he's like all the rest in perpetrating the myth that taxation funds spending, and the national budget is like a household budget.

Additionally the Treasury seems to be well aligned to neoliberal economic beliefs and that will never lead to progressive taxation and a more equable distribution of the national wealth, however earnestly MPs may express a desire to do more for the disadvantaged.

Agreed. I just wish people would go back to sources rather than rely on second tittle tattle, which inevitably suffers from a form of Chinese Whispers.

I'm really not defending Bell. I've been aware of him for some time because I read Resolution Foundation reports. Usually, they are about policy rather than specifics such as taxation. Their data is well-presented and researched, so is always useful. They might, for example, write a report about deprived areas, but they don't come up with anything more than vague suggestions.

What happens is that those suggestions sometimes get picked up by scare-mongerers and misrepresented. They're not economists, so they make simple suggestions. For example, there's too much equality, therefore tax rich people more. Actually, wealth does need to be taxed more highly, but not in the simple way people think.

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.

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.

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).

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

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

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.