Dominoes - Pay a little more

[SpontaneousOrder]

I thought essentials and many foodstuffs were VAT-exempt?

Yeah, that's kindof the point.
Lets say 10% of my income goes on the essentials, and the remaining 90% is spent un 'luxury' items/services which make life worth living.
A poor man might spend 90% of his income on the essentials, and so has only 10% left on the stuff that makes life worth living.

If the poor man saves up and buys a new TV, he might find that 50% of the final cost is VAT (i've not done the maths).
I'd find my new TV cost being 50% VAT too, but as a proportion of my luxury income, it's much less - the tax man is punishing me to the tune of 50% of all my luxury spending, but he's also punishing the poor man exactly the same even though he's had to save up for a whole year just to buy 1 luxury item.

I can only buy half of quite alot (Relatively speaking), but the poor man really gets kicked in the nuts.

[Peoplesoft bloke]

no - they would just get a job instead. And when you remove minimum wage there will be plenty of jobs, and the economy, left free enough to do so, would boom. Overall productivity is MUCH higher (especially when you consider the fact that most people starting on the low end of the pay scale will move up it in time, whereas layabout benefit receivers, or those genuinely priced out of the market by minimum wages enforced by government violence, are much less likely to progress very far), prices fall, tax revenue by volume increases, so individual tax rates fall.

And if the survival of the poorest is really a concern, then removing VAT (more government meddling breaking the economy) would be a good place to start. Of all the taxes, VAT 'unfairly' affects the poorest the most. Currently we are ruining quality of life of the poorest with VAT, and then we 'help' them with minimum wage laws which price half of them out of the market, and and shrink the market such that the other half are fighting for too few jobs.

The first part is bollocks - we had no minimum wage for most of our history. We had wages councils and strong unions but the Thatcher revolution removed both, without creating full employment - unemployment has many causes, abolishing the minimum wage won't cure it - in any case this is about a moron who wants to bring in more workers from outside to do jobs that are so poorly paid the government has to subsidise them to a point where people can actually afford to live.

The point about VAT is well made but couldn't be done without leaving the EU - and that's not going to happen.

[AtW]

I can only buy half of quite alot (Relatively speaking), but the poor man really gets kicked in the nuts.

Poor people should not worry about VAT on new TVs.

[SpontaneousOrder]

Why on earth shouldn't older people be doing low-end work? You see old waitresses and old cleaners every day, and old supermarket checkout staff, etc.

I did say 'half' of the older guys.

Most people in the lower income brackets are not an enduring class. Most working people in the bottom 20 percent in income at a given time do not stay there over time. More of them end up in the top 20 percent than remain behind in the bottom 20 percent.

There is nothing mysterious about the fact that most people start off in entry level jobs that pay much less than they will earn after they get some work experience. But, when minimum wage levels are set without regard to their initial productivity, young people are disproportionately unemployed -- priced out of jobs.

-- Thomas Sowell from some random article - but it's the same sentiment he expresses in his books.


Some people, though, just arent productive - either through choice or incompetence. At least without a minimum wage they can earn their fair market price with the pride of a self-sustaining independant human being (rather than moocher or a looter as Ayn Rand would say), while leaving the more productive to do the things that they are better at.

I do strongly believe, though, that without minimum wages there would be far fewer older people doing the mega low-end jobs - at very low wages it could be mutually beneficial for employers to employ cheap unskiled workers who then are able to gain experience on the job.

Right now i'm earning fifty-something pounds an hour; imagine that I had a fresch school leaver who was my 'runner' - he/she would only have to save me half an hour a day to justify their £2.50 an hour wage. 6 months/1 year of that could really increase their employability, instead of being stuck in a minimum wage job for the rest of their life.

[Peoplesoft bloke]

I thought essentials and many foodstuffs were VAT-exempt?

Domestic utilities (Electricty, Gas etc) have VAT on them (although at 5%)

Almost everything else except food and some public travel has VAT - for example clothes (fairly essential) have VAT on 'em (except kids).

[AtW]

I do strongly believe, though, that without minimum wages there would be far fewer older people doing the mega low-end jobs - at very low wages it could be mutually beneficial for employers to employ cheap unskiled workers who then are able to gain experience on the job.

Yeah, those people will just have to turn to those dreaded 7 figure FTSE 100 CEO jobs, so that unskilled young workers could gain valueable skill - putting pepperoni correctly on some dough

[darmstadt]

Cider

[vetran]

Short story: Housing, fuel and power becomes highest spending category in 2012 - ONS

[SpontaneousOrder]

unemployment has many causes, abolishing the minimum wage won't cure it ...

and the economy, left free enough to do so, would boom.

99.9% of it, 99.9% of the time is because the market isn't anywhere near free.

That aside, how many of us could do with a gardener if we could get one cheap enough? Remove minimum wage and instantly thousands of low paying gardener (grass cutting, bush trimming, etc) jobs spring up. People doing those jobs can earn more at £2.50 an hour than they can on the dole (not that that is the point).

[d000hg]

And what do all those people earning £2.50/hr do when this isn't enough to cover the cost of rent and food? I suppose if they work 16 hours a day it'd be OK so there's no problem!