Reply to: Tax rises?

[willendure]

It is a measure of Reeves' ignorance that she thinks this will release money for her to spend.

Interesting. I always think of tax the other way around - it destroys money.

Government spends money, it does so right away on its current account. At period end, that overdrawn account is sold as bonds, creating money. When tax revenue comes in, some is used to pay off expiring bonds, and therefore money is destroyed.

[jamesbrown]

Nice article/opinion piece on it here:
https://taxpolicy.org.uk/2025/10/21/...r-nics-reform/

Yes, good article. The Treasury has (let's face it) annual form on failing to grasp how their policy balloons/policies will land in the real world. They may have resources, but they don't necessarily have the right people or allow ideas to develop properly under scrutiny before blurting them out to the national press as a policy balloon (which, incidentally, causes a tremendous amount of economic damage in the run up to budgets). That said, I wouldn't expect any final policy to be much better developed, which is why they end up walking back policies far more often than they should.

[WTFH]

Yeah, good plan. A few percent on a proportion of the 650 sitting MPs. less the ones with actual or shadow ministerial posts, will make a huge differrence.

Same as the hysteria on cancelling IR35. Split the UK contractors across all the constituencies and we barely register. Since MPs are only there to win seats, we can be ignored in all but a handful of marginals.

Histeria is what the populists rely on. Maybe we tax people who eat swans, since there are about 20,000,000 of them arriving in the country every day.

[malvolio]

They should put additional taxes on MPs who don't turn up to do their job those of us who pay tax are paying for, because they are "too busy" doing other jobs.

Yeah, good plan. A few percent on a proportion of the 650 sitting MPs. less the ones with actual or shadow ministerial posts, will make a huge differrence.

Same as the hysteria on cancelling IR35. Split the UK contractors across all the constituencies and we barely register. Since MPs are only there to win seats, we can be ignored in all but a handful of marginals.

[ladymuck]

Oh, I don't know, the Treasury can be spectacularly ignorant. For example, they are briefing about targeting LLPs specifically, seemingly without any understanding of the wider landscape of partnerships and how they operate, which is why they briefed shortly afterwards that this wouldn't target traditional partnerships (e.g., GPs), again without understanding the implications of that (anyone who does understand will be chucking at this point). Honestly, many who work in the Treasury are as thick as mince and hence perfectly fair game for criticism. The Thick of It was not merely comedy, it was commentary.

Nice article/opinion piece on it here:
https://taxpolicy.org.uk/2025/10/21/...r-nics-reform/

[WTFH]

They should put additional taxes on MPs who don't turn up to do their job those of us who pay tax are paying for, because they are "too busy" doing other jobs.

[jamesbrown]

I love the way you think you're better informed than the Chancellor with a huge team of experts advising her. It's certainly not ignorance, although it may turn out not to be the best of several well-informed options.

Oh, I don't know, the Treasury can be spectacularly ignorant. For example, they are briefing about targeting LLPs specifically, seemingly without any understanding of the wider landscape of partnerships and how they operate, which is why they briefed shortly afterwards that this wouldn't target traditional partnerships (e.g., GPs), again without understanding the implications of that (anyone who does understand will be chucking at this point). Honestly, many who work in the Treasury are as thick as mince and hence perfectly fair game for criticism. The Thick of It was not merely comedy, it was commentary.

[Snooky]

It is a measure of Reeves' ignorance that she thinks this will release money for her to spend. It won't, people will simply put it elsewhere.

I love the way you think you're better informed than the Chancellor with a huge team of experts advising her. It's certainly not ignorance, although it may turn out not to be the best of several well-informed options.

[Protagoras]

The tax raid on ISAs is not directly about revenue generation, it's to force money on to the stock market.

Which aleady looks to be in bubble land to many off us!

[malvolio]

LLP changes (confirmed)

Div allowence kept, banding frozen and rate increased, so corp tax + div tax matches self employed tax level (about £2k difference at £100k profit). Possibly corp tax changes to small business relief instead to align tax rates
VAT on other 'luxury services'

If she goes with income tax increase div tax will certainly go up.

Cash ISA limit dropped to £5k per year.

The tax raid on ISAs is not directly about revenue generation, it's to force money on to the stock market. The zero tax is only on the interest earned, running at around 4% at the most so barely above inflation. Reducing the contribution limit isn't going to do anything for the billions already in ISAs, which the banks freely admit is the source for the money they invest in the market . And let's not forget, most ISAs were filled up from taxed income, as somewhere to park your rainy day money safely.

It is a measure of Reeves' ignorance that she thinks this will release money for her to spend. It won't, people will simply put it elsewhere. This is not major money, the average ISA is £33k or so, even those of the older savers is £63k.

[BlueSharp]

LLP changes (confirmed)

Div allowence kept, banding frozen and rate increased, so corp tax + div tax matches self employed tax level (about £2k difference at £100k profit). Possibly corp tax changes to small business relief instead to align tax rates
VAT on other 'luxury services'

If she goes with income tax increase div tax will certainly go up.

Cash ISA limit dropped to £5k per year.

[SueEllen]

Reduce the amount you can put in cash ISAs to 10K per year, and ensure that 25% of money going into Stocks and Share ISAs is invested in companies listed in the UK.

[hobnob]

how many EV lorries are on the road...?

Not many at the moment, but it looks like that number will increase.

"By 2040, all new heavy-duty trucks will be zero emission with smaller trucks weighing less than 26 tonnes being phased out from 2035 onwards.
For now, the transition is slow. Just 1% of new heavy goods vehicles sold are zero emission – but it’s a growing market and one government is keen to support with financial incentives."
The rise of electric heavy goods vehicles in the UK: What businesses need to know in 2025 | GRIDSERVE

[Protagoras]

I stick with my original analysis. I do not expect logic or fairness to be any part of the upcoming budget. The real answer is to cut back the public sector and the welfare state to something more sensible. That won't happen either .

I don't disagree with any of your comments. These 'budgets' are not really driven by rational economic considerations, but rather by political considerations and the interests of party stakeholders.

[malvolio]

Erm....

Fuel duty rises and increased taxes for non EVs. Effectively a tax for those refusing to conform.

Or refusing to sign up to an incomplete and inefficient solution? Would also increase the cost of everything - how many EV lorries are on the road...?

Increasing taxes on unearned income to align with earned income.

There's not a lot of difference now if you look at all the elements

Tax ISA interest for those with over £100k in ISAs.

Probably need primary legislation. Plus serious money is not in ISAs anyway.


I stick with my original analysis. I do not expect logic or fairness to be any part of the upcoming budget. The real answer is to cut back the public sector and the welfare state to something more sensible. That won't happen either .