Wednesday, 21 March 2012

The Granny Tax

Age UK called it 'disappointing' and warned that it would leave pensioners hundreds of pounds worse off and the TUC general secretary said that the decision to raise more than £1 billion extra in tax from pensioners by freezing age allowances will haunt the Chancellor. Even the Treasury acknowledged that 4.5 million pensioners would lose out by today's announcement.
Already dubbed the Granny Tax, the Government have done such a hatchet job that they have not even had the comfort of a few days grace before people start shouting just what a steaming pile today's Budget has been.
It did try to spin the Granny Tax plan by weakly explaining that 'many pensioners don't understand the Tax System so this will simplify their tax' but the smokescreen was blown away before it even had chance to cover their tracks.
Instead, the cry went up immediately and grew louder when it became apparent that the elderly are being asked to pay more while the rich earning over £150,000 a year have their tax liability reduced.
The Tories did have a dilemma though, whether to tax wealthy individuals who donate a lot of money to the Tory party which could pay for the pensioners or cut money to pensioners. Of course they went for the latter and reduced the amount the the rich pay by 5% and they couldn't even spin that right.
The Chancellor said a study by HM Revenue and Customs found that the '50p rate had raised just a third of the £3 billion predicted'. So he scrapped it but £1 billion is not a trifling amount and is almost how much he was looking to save by slashing Disability Living Allowance to the disabled.
So £1 billion taken from the disabled is a significant amount but £1 billion from the rich is not significant enough to collect?
The Labour Party should already be formulating the line that the millionaires in the Government are handing their millionaire backers a tax rebate by snatching it from disabled children and pensioners.
At least the uproar over the nasty parties latest piece of wrecking-ball politics will allow the fact that they passed the bill last night which opens the doors to privatisation of the NHS to slide by unnoticed.


Anonymous said...


i'm not gonna challenge any of your data or (to use a phrase you used with me last week) your rant.

i did some calculations. if the UK taxed people that make over 200,000 pounds at a rate of 100%, and divided it among the 27,000,000 that make less than 100,000 pounds and pay taxes, they would each get 3,500 pounds.

of course, the UK would then have 100,000 "rich" people with no income...

if you divide the income of the “rich” among all people that made less than 100,000 pounds including those that paid no income tax, it drops down to 1,000 pounds each.

Bottom line: Yawl got big problems in the UK and taking the wealth from the rich is not going to fix the problem. I also doubt that you would feel satisfied longer than a week because the reality that the poor are still poor would quickly hit home…

Sounding like Greece. The US is sounding a lot better…


Cheezy said...

"if the UK taxed people that make over 200,000 pounds at a rate of 100%"

Erm, huh? The debate is (or rather, was) over decreasing the marginal tax rate from 50% to 45%, and the effect that this would have on both business and tax receipts. I doubt that even the handful of communists that this country still has would be advocating a rate of 100p in the pound! So I don't really get what you're saying here.

Cheezy said...

@Lucy: What was your opinion of the other parts of the budget? I’ve had a chance to digest most of the details of the budget now, and here are my main impressions...

Worst thing about the budget = The Granny tax. Bad politics for no real gain. It aims to ‘simplify’ the system but won’t succeed.

Best thing about the budget = The statement that every taxpayer will now receive, detailing how our tax money gets spent. This should have happened decades ago, and will no doubt quieten down most of the ‘all tax is theft’ extremists.

The missed opportunity = Not reducing the amount of national insurance contributions expected of employers. This is a disincentive to hiring that impacts particularly harshly on smaller businesses - which we don’t exactly need right now.

Great idea but I doubt it will happen = ‘Closing the tax loopholes’. Every Chancellor says he’ll do this, along with ‘eliminating waste’. Good luck getting that £5 billion that Vodafone owe us, George.

The 'white elephant' that everyone’s talking about but won’t make as much difference as people think = Lowering the marginal highest tax rate from 50% to 45%.

Good, but not strictly necessary at the moment = The reduction in the corporate tax rate. Our rate is already lower than most of our trading partners (Germany – 30%, France – 35%, USA – nearly 40%), and the UK is already comfortably rated as one of the top ten places in the world to do business. Yes, it would be great to be # 1, but right now there are other priorities.

Overall then: There’s still no acknowledgement that economic growth is by far the best powerhouse to paying off public debt. We’re still labouring under the impression that 100% austerity is the way forward. In as much as this has stopped our crazy Brown-era borrowing, it’s a good thing. But in as much as it will power any kind of economic growth, it’s a flop. A more nuanced approach is needed, with much less ideology. Not much chance of that with this bunch though...

Anonymous said...


is that what lucy was trying to say? it was not as clear to me as it was to you.

i detected a statement behind the statement... lucy is back on her steady theme of "the greedy rich people versus the needy poor people".

my steady theme, was you cannot make poor people rich, all you can do is make rich people poor.


Anonymous said...


concerning your observations... nuance may be needed in the UK, but a global economic recovery is also needed, and withdrawal from Afghanistan, and sustained good weather, and new energy policies, and retooling of the workforce, and a new focus for your educational system, and more...


Cheezy said...

"is that what lucy was trying to say? "

Not sure what you mean. I didn't see Lucy advocating taking 100p in the pound from anyone, but I did see you saying that this was a bad idea. Yep, it most certainly is. But it's also a straw man, because nobody is advocating this.

"a global economic recovery is also needed, and withdrawal from Afghanistan, and sustained good weather, and new energy policies, and retooling of the workforce, and a new focus for your educational system, and more..."

Those are all superb ideas. That's exactly the sort of nuance I'm talking about! You should replace George. His only idea is 'let's not spend any money'. Oh, and give a big 'bankers bonus' to my chums.

Lucy said...

Q, the headline is the 50p tax rate is being reduced and OAPs are losing out. Politically, that's madness because everyone very quickly came to the conclusion that the pensioners are being asked to pay more while the richest are being asked to pay less. The attempted Government spin about 'the old don't understand tax so this will make it simpler' and 'the 50% rate only raised £1bn so was not worth it' was batted aside instantly.
My rant wasn't about how much will be raised and austerity, it was shouting very loudly 'LOOK, THE TORIES ARE TAKING MONEY FROM THE POOR AND DISABLED AND GIVING MONEY TO THE RICHEST PEOPLE'. It's all about the angles.

david g said...

Lucy, I have visited many blogs across the world. Never have I encountered a blog where the major commenters constantly question or dilute the messages which the blog author is trying to communicate.

Dumb and dumber are about as much use to you as a hole in the head. They both ensure that they sit on the top perch on your blog and deter anyone else from contributing.

It's only your kindness that
allows them to dominate your blog.

They are both bad news!

Anonymous said...

david, our strategy sadly isn't working with you. how do my comments keep any sane person (sorry to exclude you) from commenting on any aspect of lucy's original comment?

lucy, appologies for arriving at and executing such a powerful plan at the cost of your blog - i won't condemn cheezy by implying that we colluded to do this... you still have a chance since we can't quite get rid of the viral infection named davidgidious... it is my fault that you can't have a high impact blog like david who gets 400 or 500 hits a week. >>what a joke<< 7 billion people in the world and he thinks 500 hits a week is a lot (D E L U S I O N A L?).

i assume you don't want a high volume blog, or you would be doing things to draw more commenters...


Lucy said...

What i would like to see, but not set up or co-ordinate, is 1 current affairs blog with bloggers contributing to the blog. Like an online magazine or newspaper. Team blogs seem to be where things are heading but far too time consuming for me to attempt.

Falling on a bruise said...

Somehow i lost the top of that previous comment which went along the lines of: I'm not sure where this blog is heading, it just seems to be floating along with the tide at the moment. What i would like to see....

david g said...

Lucy, this is my last comment on your blog. Dumb and Dumber have won!

Intellectual mediocrity, shallowness and bad taste has triumphed as it usually does.

Good luck and take care.

Anonymous said...


sounds like he wants you to beg him to stay, or he wants an apology from me. i'll stick to the topic if he will. i got tired of his comments being directed at me instead of the thoughts offered.

i don't care if i never hear from him a gain.


Cheezy said...

Sounds like you're in danger of judging everyone by your own pathetic standards, David.

It's never been my impression that Lucy is demanding complete agreement in the comments section of her blog. If she does, she only has to say and - of course - I'll abide by her wishes. Her blog, her rules.

But I'd be surprised if she wanted an 'echo chamber', as she's made of stern intellectual stuff... certainly much sterner stuff than you are, Dave-o... (but that's damning her with faint praise, I do realise).

I'm curious, Dave. Does a dim voice ever pop up in the back of your head and quietly whisper in your ear "hey, maybe the problem... is me?".

After all of this time, surely it must have.

All of these hundreds of threads where you haven't contributed a single thing apart from a whinge that you don't like certain nationalities and certain people.

Well whoop-de-doo, who cares what you do or don't like? If you contributed to the debate - ever - then we might start to care, but you never ever have... and you realise this, deep down, don't you Dave?

That little voice must have told you that you're the 'odd one out' here right? I disagree with both Lucy and Q on a pretty regular basis (as they do with each other) but nobody else has fallen out because we treat each other with a modicum of respect and civility, and don't make dickheaded assumptions about them being either being evil or brainwashed simply because they happen to come from a certain place.

Whereas you do all of that, don't you Dave? Scroll up this thread and read what you written, compared to everyone else who's writing about the actual topic. Then look at every other thread you've commented on. You'll see exactly the same thing: Everyone else addressing the topic, and you just acting like a dickhead troll. C'mon Dave, even you can see this, right?

In conclusion then: See ya. Wouldn't wanna be ya.