Corporation tax receipts are less than a third of that collected in income tax, nearly three times less than NI receipts, and well less than half of VAT collections.
If you also consider half the NI is paid by employers its another tax that employers have to budget for at 13.8%, German employers pay less than half that.
We cant adjust VAT due to EU rules, but we can alter Income tax and NI a very small adjustment in certain areas would bring more revenue in and not affect investment
1. Usual lawyer word twisting. The fact I was referring to was the actual amount that a tax cut costs the public purse if there are no behavioural responses. E.f. The IFS stated that the cutting of the various rates of corporation tax since 2010 costs us at least £16.5 billion a year. And as I clearly said in my very next sentence this doesn’t take into account behavioural responses. But it is a solid, factual amount, X – Y that can be calculated and presented as a top line amount before you look into what gains you could make by subsequent benefits to the economy. Surely we should be looking at what we are getting in return for this in related increased revenues for public services. Surely, in return, there should be better proof of benefits than what you are providing, which are pretty much faith based.
So now you are distancing yourself from my whole point, everything I have ever typed in argument with you, that cutting corporation tax appears to be costing us too much in what we lose from the public purse, that although there are economic gains (as posted by you and others on here, which I accept) it does not appear to compensate for the £16.5 billion it costs us in services. It seems bewildering that although this has been the whole basis for my argument with you, you now appear to not notice that this was my point. Oh dear…
As I said to you when I was unsuccessfully trying to avoid this argument with you again, there is no real point debating it any more than we did do months ago as we both clearly have our points, we both have evidence for our points and as you now say it is impossible to say whether one model produces particular effects. However, if you’re going to promote so passionately an economic stance that is costing us £16.5 billion per year (before behavioural responses) then it is not unreasonable to expect that there would be greater evidence of that costs being recovered via the benefits that businesses are getting from it? It’s costing us a hell of a lot for what at the end of a day is your very own little economic faith….
2. I would accept approximately 2,113 job losses in return for an increase in corporation tax that would offset the manifesto policy on student. By the same ridiculous line of questioning, how many public service jobs would you consider acceptable to pay for a 1% cut in corporation tax?
Separately to the You refer to the JRF report backing up your views that the economy has improved poverty in recent years. Is this the same report that in a subsequent press release stated that:
• 400,000 more children are living in poverty than in 2012
• 300,000 more pensioners are living in absolute poverty than in 2012
• “Very little progress has been made in reducing poverty among working age adults”
Campbell Robb, chief executive of the independent Joseph Rowntree Foundation, said:
“These worrying figures suggest that we are at a turning point in our fight against poverty. Political choices, wage stagnation and economic uncertainty mean that hundreds of thousands more people are now struggling to make ends meet. This is a very real warning sign that our hard-fought progress is in peril.
“Action to tackle child and pensioner poverty has provided millions of families with better living standards and financial security. However, record employment is not leading to lower poverty, changes to benefits and tax credits are reducing incomes and crippling costs are squeezing budgets to breaking point.
https://www.jrf.org.uk/press/uk-pove...-turning-point
Trashed by your own source. Well done lad, well done.
Where else can working capital come from? If you're running at a loss then you will soon go bust.
Any kind of profit is good in the current economic climate but in our industry 3.5% isn't brilliant. I have worked in this industry since 1999 and consistently achieved 7%.
Investment obviously reduces future CT, whether it is direct through the P&L or via Capital Allowances, but the money for the investment has got to come from retained earnings which has already been taxed. The higher the tax rate, the lower the retained earnings.
Sorry, meant to EU have controls on VAT we can adjust but not below 15% due to EU rules, our VAT threshold is the highest in the EU meaning that the masses of receipts we collect is due to scope and consumer spending...year to April £128.2bn compared to £53.3bn in corp tax
Last edited by gm_gm; 16-07-2018 at 12:57 PM.
"Campbell Robb, chief executive of the independent Joseph Rowntree Foundation, said:"
Highly paid chief exec of the very biased Joseph Rowntree foundation, a snow plough is needed to get through the snokflakes that make their livings there
Robb himself, being a well known Tony Blair supporter. BTW nobody voted him in, he was given the job
Hardly going to be giving out well balanced reports are they, bearing in mind that they all earn a living publishing their twaddle.
What makes matters worse the BBC use them as a source of information which they then broadcast as "fact", when at best it's just an interpretation seen in their eyes, not true fact.
But many fall for it, as the earlier reply in this thread fully demonstrated.
You said you needed a profit to fund working capital that isnt strictly true. You can manage working capital (cash flow) on break even and many do. Obviously a loss is different (but the shortfall can be funded through loans or inward investment).
Corp Tax is on nett taxable profit. You take investment off first before calculating nett profit. It doesnt matter the rate of Corp Tax - you start with the full pot of money available for investment. If you dont reinvest you're taxed in the full amount. (As I understand it).
Agree on vat.
Note our vat threshfold was raised by this Gov from 17.5% to the top band of 20%.
Interesting therefore that the Tory supporters on here are up in arms about a suggested hike in Corp Tax which has less impact than the rise in VAT - except....CT effect their precious share divvis and vat hits the poor.
It's great to see the likes of Wanchai, MMM and pup knocking seven bells out of the tories on here with their well constructed economic arguments. Obviously guys who know what they are talking about. If it had been a boxing match it would have all been over a long time ago but they keep getting up with their punches become weaker and weaker, energy sapped.
Call it a day boys. You can't defend the indefensible.The tories have had it and only stay in power because of deluded ten bob millionaires like some who argue in defence of them on here.
Last edited by rolymiller; 16-07-2018 at 02:27 PM.