Just 'Cause It's Legal It Doesn't Make It Right!

Chancellor George Osborne has today announced he is “shocked” by a fact most of us have been aware of for years – the richest people hang onto their wealth by organising their financial affairs to minimise the amount of tax they have to pay.

Apparently, according to a study by HM Revenue and Customs, the richest people pay an average of only 10% of their income in tax.

However, it is also a fact they are not breaking UK law, but using it to its maximum benefit.

Instead of paying money to the country, they are employing armies of accountants and financial advisers, whose role it is to find legal loopholes, and exploit them for maximum personal gain.

Osborne said:

"I was shocked to see that some of the very wealthiest people in the country have organised their tax affairs - and to be fair it's within the tax laws - so that they were regularly paying virtually no income tax. And I don't think that's right."

Of course, it has only recently become fashionable for politicians to question the morality of legal tax planning (avoidance) measures but it really does pose the question:

Why, has it taken almost two years in office - and even longer as shadow chancellor - for Osborne, to publicly 'wake up' to the fact just 'cause it's legal it doesn't make it right?

Could it be connected to the latest dire opinion polls?

Fuelling A Panic?

 

If ever there was an example of our coalition government's lack of understanding of 'real' people, it's the latest debacle over a possible strike by tanker drivers who deliver the much needed fuel to our forecourts.

Following on from its attempts to promote negative public opinion on benefit claimants, students, pensioners, pasty eaters and anyone else who doesn't live in the 40 percent tax bracket, government 'spinners' thought they would turn us all against the members of Unite union who, apparently, threatened to strike over changed working terms and conditions. Please bear in mind, a strike had not been called; it had only been optioned.

I should point out, I have no knowledge or interest in the rights and conditions of the drivers, or the fact they earn a larger than average wad of money by seating themselves on top of a potential bomb whilst navigating the M25 and other possible roads to hell.

Time for the coalition's manipulators to bring on the clown....

Enter, stage right, government minister Francis Maude who, like a member of Dad's Army, told us not to panic about a possible shortage, but to go and fill up jerry cans with petrol and store them in our garages.

Personally, I don't have a garage and wouldn't know a jerry can from a tanning salon.

It seems, though, I am not the only one without a garage, as someone made the headlines today by setting themselves on fire whilst trying to transfer petrol, between cans, in her kitchen – all while the cooker was working! I should probably now be writing about the decline in the standard of science education but I am still in a state of disbelief.

Of course, when someone from the government says “don't panic” we 'real' people all DO panic. Predictably, we rush to sit in queues waiting to fill any available container we can find to fill.

Those in society above the level of 'real' people send their chauffeurs and nannies to sit in the queues on their behalf – well, this is the big society!!

After three days of extra panicking, queuing and an increase in petrol sales, it appears the tanker drivers' union is going to start negotiating, via arbitration service ACAS, on Monday and any 'strike' won't be 'struck' in the immediate future.

So... panic over?

Not quite, as the poor old oil speculators now have to worry about how they are going to manipulate their financial planning to minimise their exposure to tax, whilst our beloved coalition government will have to pay out enormous amounts of overtime to the civil servants who will burn the midnight oil counting all the additional tax revenue gained from the extra fuel sold during the 'panic'.

Prepare yourself to hear the chancellor pronounce good financial news next month.

Do you get the feeling we've all been taken for a ride?

Driving Down Taxation Street!

Have you ever wondered just how much you spend on ‘fuelling up’ your car each year?

If you are like me, you deliberately don’t keep a record, as you know it’s going to be a frightening amount of money.

Let’s take it a stage further and work out how much of your hard earned wages you are paying in tax, to the government, on that fuel each year.

According the the FairFuelUK campaign, if you drive 10,000 miles per year:

• Total Cost of fuel to you = £1702

Of which:

• Excise duty = £766
• VAT = £284
• Total Combined Tax = £1049

If you can bear to look, you can find comparable figures for differing annual mileages here

Happy motoring!!

A Long Time Resting.....

It’s been almost two months since I've posted on here and I am ashamed of myself; I needed a break.

I've also been testing new technologies to make my writing life easier but somehow I never got re-started.

A lot has happened in the world in the time I have been away and if I had been writing, it would probably have included the following earth shattering events:

 

The World:

Tunisians demonstrate and get rid of ‘tyrant’

Egyptians demonstrate for even longer and – eventually – get rid of ‘tyrant’

Other Arab countries start queueing to demonstrate and get rid of ‘tyrants’

Daily Mail tries to create hysteria over Muslim takeover of UK and the world

 

UK Politics

Liberal coalition ministers have been noticeably less ‘visible’ in the media

VAT increases to 20 percent

Fuel prices rocket, yet again, as crude oil prices rise, 1p tax goes on a litre of fuel and VAT is added to that

Inflation rises

Jobless total rises

Coalition still using the old “left with a huge deficit” excuse

More troops lose their lives in Afghanistan

Still no-one is brave enough to ask the question: “how much is this bloody war costing?”

Ministers abstain over vote on EU Court ruling that prisoners should get the vote

Cameron still confuses everyone with Big Society

Coalition announce their intention to modernise (a.k.a privatise) the NHS

Multi-million pound Nimrod air defence aircraft get broken up for scrap to save a few bob.

Coalition announce plans to sell our forests (it’s the only thing left to sell)

 

Celebrity Stuff:

Katie Price announces split from her cage fighting husband after almost a year.

Meanwhile, Peter Andre (Katie’s previous ex-husband) seriously dates Elen Rives (footballer Frank Lampard’s ex-wife)

Katie Price is spotted (mainly in the Daily Mail) partying – lots!

The world’s 2nd most boring couple Katy Perry and Russell Brand allegedly seek counselling after he tweeted a pic of her without makeup

Elton John and his partner have a baby.

 

More UK Politics:

Labour’s Shadow Chancellor resigns after his police protection officer is, allegedly, overly 'protective' of said Shadow Chancellor's wife.

It is revealed that over 50% of Conservative party funding comes from City finance (highest in 5 years)

Coalition go on using the “inherited with a huge deficit” excuse

Our student protesters are no longer 'revolting' – for now at least

Bankers resume paying themselves excessive bonuses

Wikileaks extradition hearing suspended, once more, after the revelation Julian Assange allegedly applied for a ‘missionary position’ in Sweden.

After ‘outrage’ from the Big Society (that’s you and me – I think!) The PM announces a government U-turn on selling the forests (maybe he has turned over a new leaf?)

 

More Showbiz Stuff:

Daily Mail ‘reports’ on actress Emma Watson’s ‘wardrobe malfunction’ as an excuse to publish a paparazzi shot of her nipple

Prince Philip reaches 90 (years old….not number of gaffes!)

Top Gear presenters offend all Mexicans – apparently!

England Rugby team are playing well this year

Big Fat Gypsies hold weddings in our living rooms

Actress and celebrity Kelly Brook poses full frontal wearing nothing but lipstick – all over!

Coronation Street gets more depressing

Emmerdale gets more depressing

Eastenders ……well it was always…… depressing!

Oh and did I mention….?? Kelly Brook posed full frontal wearing nothing but lipstick – all over?

Apparently, her mum said ‘they’ (I presume she was referring to the pictures) have the ‘Wow Factor’!!

Well, you should never argue with a Mum!!

Happy Days!!



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Cameron's 'Extravagant' Arrogance Needs Cuts

In politics, there is a very fine line between arrogance and leadership and today, the Prime Minister, David Cameron, came close to proving my point.

He has told opponents of his coalition’s housing benefits caps to “think again” describing the benefits as “extravagant”

He also said:

"Paying over £20,000 a year for the housing benefit of some families is too high. I do not think taxpayers who pay their taxes will understand why we are being so extravagant,"

(I note, however, he failed to mention those in his cabinet who take measures to avoid paying their taxes)

and:

"There are many people who earn less than £20,000 - their whole income is less than £20,000 - who are paying taxes to house people who are getting rents of £25,000, £30,000, £35,000, £40,000. They don't see that as fair and neither do I."

However, it seems he has completely missed a very large point.

Many families, particularly in parts of London, have been living in the same accommodation for many years. They originally moved into areas that, at the time, were seen as being deprived and populated by low income communities.

As the economy has grown over the years, many of those areas have been developed becoming ‘trendy’ with the wealthier bonus culture ‘city types’ splashing their cash and changing the locality into a fashionable and desirable address to have. They have invested their money wisely and as a consequence have raised the rents.

That is not the fault of the tenants who now find themselves living in such desirable abodes. They do not negotiate the rents with the landlords. They should not be demonised as being “extravagant” or “scroungers”

It is, also, worth remembering that Margaret Thatcher sold off much of the available social housing to buy votes and raise capital but then failed to invest into providing more modern, affordable properties, to replace it - she was the Tory leader that Cameron aspires to be.

I guess the real question, though, is will our national conscience (is there still one?) remain dormant, if thousands of long term tenants are moved out of their ‘high price’ rented accommodation and shipped many miles to areas where the rents are more ‘affordable’.

For that matter, do we really want to see a capital city, that is known for its diverse and colourful population, turned into an overpriced and arrogant ‘ghetto’ of monied bankers and lawyers.

I am guessing this will not be an easy ride for Cameron or his coalition partners.

I am also thinking he is arrogant and not yet, at least, a great leader

Boris Johnson's Ethnically Cleansed TV On The Radio!

London Mayor, Boris Johnson's widely reported remarks, criticising the coalition government for their proposed draconian housing benefit reforms, appeared at first sight to be spontaneous.

But, I wonder, if they were that spontaneous, why did he have a television crew filming what was supposed to be a regular radio interview with broadcaster Vanessa Feltz.

It seems his comments might not have been so 'off the cuff' after all!

He's A Liar Liar

Whether you agree or not, a lot of work must have gone into this!

Try singing along....

How To Demonstrate EU Style!

With a high probability we will be seeing mass demonstrations against the cuts announced in our coalition government's spending review, I thought it would be interesting to compare our technique with our European neighbours:

How we demonstrate here in the UK

How they demonstrate in France

How they show their displeasure in Germany

All things considered, I think it advisable to wait on the weather forecast before we follow their lead!

Poorer And Not Really The Wiser!

One day on from Chancellor George Osborne's spending review, aiming to save the nation from the consequences of our profligacy, we are, apparently, still all in this together (although, depending which newspaper you read, some of us seem to be more 'in it' than others).

Overall, I was not as depressed last night as I thought I would be, but I was disappointed that some opportunities were missed and others were clearly misguided.

Whether I am right or wrong about the big things, there is one thing of which I am certain: I am going to feel worse off, I will probably have to work another year and I probably won't have the pension to enjoy the time I do have left!

Oh Happy Days!

The Ins And Outs Of The Economy - It's Simple!

OK. so here’s my theory...

Our country is in a fiscal mess because there is not enough coming in through taxes to cover the amount going out via government spending.

Cutting the number of people claiming benefits from the state and telling them to get jobs will, theoretically, save a large part of our 'overdraft'. The only problem is: there are not enough jobs available for everyone who is currently out of work, let alone those who will come off benefits to seek work.

A recent survey by the Federation of Small Businesses revealed that almost 11% of business owners expect to decrease employment over the next few months, due to weak business confidence in future prospects and revenue growth. Even more workers will, therefore, become unemployed, stop paying tax and start claiming benefits. Result: the country slips into an even worse mess.

For business owners to regain confidence in the economy, we all have to spend money buying their products which in turn allows them to take on more staff, who then pay more tax and increase the government’s revenue, thereby reducing the deficit. Simple isn't it? Errr well not really!

An alternative option is to increase the rate of tax paid by those who are in work and in indirect taxation like VAT. But then, we will all have less disposable income to buy the goods which in turn create the jobs. Companies then collapse, more people are unemployed and the taxes raised decrease yet again

Of course, the experts would tell you it is more complicated than my simple view.

Our coalition government is about to announce a blanket 'cuts all round' programme to immediately claw back some of its losses. For the reasons given above, though, it is likely to be a lose, lose situation.

Whatever the Chancellor decides to do tomorrow, it is certain to cause massive hardship for those who are already struggling.

I am becoming increasingly convinced, we are in danger of causing more problems than we are ever going to solve.

But then.....what the heck do I know?

The Benefits Of The Chancellor's New Voice!

Chancellor George Osborne, in his latest headline grabbing attempt to demonise anyone on benefits, has quite rightly declared a war on those who cheat the system.

He is reported as saying:

"Frankly, a welfare cheat is no different from someone who comes up and robs you in the street. It's your money.”

and:

"This money is paid through our taxes which is meant to be going to the most vulnerable in our society, not into the pockets of criminals."

All very admirable words, until you remember he appeared to have lost his voice at the time of the parliamentary expenses scandal.

Pots and Kettles Mr Osborne!

The Benefits Of A Fairly Unfair System!

I doubt there is anyone who can dispute we are in a financial mess and something needs to be done to control the enormous interest payments we are making to foreign institutions and governments for our borrowing.

The most obvious and headline grabbing saving, is to reform the vastly complicated and financially draining benefits and welfare system. It is a system that many voters regard with contempt, mainly due to the negative stories in the press of benefit cheats and scroungers, so it is a reform that few will oppose. After all, it is rare we get to hear of the majority, who have only survived because of the help they receive from the system.

Chancellor George Osborne, has today announced a total restructure to bring fairness for all, while making the system cheaper to administer and easier to understand.

In the interim, he announced that universal child benefit, payable to all families whatever their income, is to be stopped for those who earn around £44k per year.

At the other end of the scale, no family will be able to claim a total benefit greater than the national average wage received by a family in full-time work - thought to be around £25k per year.

On the face of it, this does seem like a fairer system, as those who can afford it lose a freebie and those who can’t don’t gain financially by remaining out of work.

However, when looking at the figures supplied by the BBC, it seems that those at the top end will only lose around £1.7k for a family with 2 children while a family receiving full benefits will lose anything from £4.5k to £15k per year.

Work and Pensions Secretary Iain Duncan Smith told the BBC: “I don’t love the idea of this, you know”

Neither will those who are genuinely unable to find work and who are about to be hit the hardest!

Asda First To Help Us 'Cash Cows'

(graphic from PetrolPrices.com website)

Once again supermarket giant Asda is leading the way in passing on lower fuel costs to its customers.

As the above graphic demonstrates, it is even more admirable when you see the small percentage that a retailer actually makes from a litre of fuel. Their own profit has to come mainly from volume of sales rather than true markup.

Add the duty to the VAT, though, and it is easy to work out why the government are in no hurry to help us all when we are such a cash cow standing in their field of financial black holes.

Despite the idealistic views of certain political parties, fuel is a necessary and unavoidable part of everyday life for most of us. Not everyone has the benefit of good public transport and those of us who live outside of the cities have no choice other than to drive to work.

True recovery will not come until the price of a litre becomes realistic once again!

Politicians Take Their Seats For 'The Blame Game'

With our new coalition government announcing June 22nd as the date for its emergency budget, the opposing players are taking their places at the table for ‘The Blame Game’.

First to throw a six and keen not to take any blame for the financial suffering we will all be subjected to, the Chief Secretary to the Treasury, David Laws, conveniently ‘let slip’ yesterday that he had been left a ‘note’ from his predecessor stating what most of us had long ago realised - there is no money left in the UK’s piggy bank. He also hinted there had been a desperate last minute spending spree, by outgoing Labour, with money they knew they did not have to spend.

Round one to the coalition but I am sure it will not be too long before Labour get their throw with the dice!

Lack Of Government And The Financial Plughole.

According to a respected economist on the BBC this morning, the amount our dying government is spending per day is £550m more than we are collecting in taxes etc. That means in the 4 days of dithering to decide who is going to lead the country after the election, we are a whopping £2bn further into the red.

If we don’t get an agreement soon, the only party left willing to make a deal will be the bailiff!


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Profiteering And A Complete Bunch Of 'Bankers'

Barclays Bank has just announced profits of £11.6bn. This is an increase of 92% on the previous year. Other banks are expected to announce similar news in the near future.

Barclays' management is intending to share out a bonus pool of around £1.5bn amongst some of its staff.

Meanwhile, interest on credit cards is running at its highest level since the late 1990's, despite the lowest base rate we have ever seen.

According to the Institute of Directors, 60% of small firms are being turned down for loans by the banks. Many are only surviving in the short term by the use of credit cards.

Yesterday it was reported that it will not be until at least 2016 that we will see repayment of the massive public funds poured into the banking system by the present government.

Is it really surprising then, that such huge profits are being announced?

It seems that City institutions have, once again, taken us all for a ride.

They really are a complete bunch of 'bankers'

Life On Planet Concussion!

It has been a while since I last posted on here, following my spectacular dive down the stairs and my teeth numbing stop, using my head as a brake, against a doorframe.

Since my unplanned flight, I have been living on Planet Concussion. It is a strange world I entered after needing the rather confusing quality of service available from the NHS (could do better – maybe more written later) and where I have imagined strange things to be happening all around me.

For instance, I had visions of the leader of the over hyped and allegedly racist BNP being grilled on Question Time while outside the studios, demonstrations were taking place ; of MPs being made to re-pay and apologise for the expenses they had inadvertently claimed while “just following the rules”; of X Factor contestants taking up more space in newspapers than proper journalism; of footballer’s wives miraculously being able to give birth to babies; of even more of our troops losing their lives in a mystical land called Afghanistan; of senior scientific advisors to the government being sacked for not agreeing with the political will of our rulers; of bankers being curbed from receiving huge bonuses for doing what they are already paid to do and of the next prime minister of our great country performing a complete U-turn over holding a referendum over Europe.

The weirdest vision of all was the one where Transport for London insisted that actress Kelly Brook should have her own 'buns' concealed with...even bigger buns on a poster advertising the play Calender Girls on London's underground trains.

Planet Concussion is a scary place to be and I am really looking forward to returning to the real world, where things like these would never happen!!

Government - The Illogical Cost Of Logic!

The politicians are, once again, taking shots at each other over the spiralling cost of government and how they are going to reduce it.

The Leader of Her Majesty's Opposition, David Cameron, said yesterday he would cut back on the expensive and unelected quangos should his party win the next election.

What is needed, though, is much more than that; it is an understanding of how the system works in the first place and that is something that no-one seems to be able to get their head around.

The best illustration of the way our government is run was printed in the letters page of The Kent on Sunday at the weekend. It read thus:

Once upon a time, the government had a vast scrapyard in the middle of a deserted industrial estate.

A civil servant said: “Someone may steal from it at night.” So they created a night watchman position and hired a person for the job.

Then the Prime Minster said:

“How does the watchman do his job without instruction?”

So, they created a planning department and hired two people - one to write the instructions and one to do time studies.

Then, the Minister for The Department of Work and Pensions said:

“How will we know the night watchman will be doing the tasks correctly?”

So, they created a quality control department and hired two people - one to do the studies and one to write the reports.

Then the Chancellor said: “How are these people going to get paid?”

So they created the positions of time-keeper and payroll officer, and hired two more people.

Then the Treasury said: “Who will be accountable for all these people?”

So, they created an admin section and hired and administrative officer, assistant administrative officer and a legal secretary.

Then the Chief Secretary to the Treasury said: “We have had this command in operation for a year and are £18,000 over budget. We must cut back overall costs.”

So, they made the night watchman redundant!

Seems to be a pretty fair summary to me....!

Driving Into More Debt!

The much awaited - and feared - budget was announced in Parliament today by the Chancellor. It contained very few surprises and confirmed what we already know - we are heavily overstretched and it will take years to pay back what we have borrowed as a country.

One piece of news that did make the headlines was the £2000 rebate against the purchase of a new British made car. All we have to do is send our old models (over 10 years old) to the scrap yard.

Of course, in theory, this is a good idea, as it helps the environment and gives a vital shot in the arm to our struggling motor manufacturing industry - what little there is left!

So far so good then. Let's all rush out to the nearest showroom and purchase a new eco-friendly car and get shot of the dirty old gas guzzler. But wait.....that is when we run into the problem!

Most of us who drive ten year old cars do so because we cannot afford to have newer models. It is not an eccentricity in our genetic make-up but a necessity. The average price of a new car has to be at least £10,000 leaving an £8,000 shortfall.

The recession we are experiencing, has been exacerbated by the banks refusing to make loans and from people who have overstretched themselves by borrowing too much, when money was in plentiful supply.

There lies the dilemma. On the one hand, it is unlikely that we will be able to find the finance necessary for the car and on the other, if we get the loan, we are just adding to the unmanageable debts we already have.

Someone in the Treasury should have looked up the term Catch 22!