Force of habit

For the love of mike… Can not this government do something right? Ever? Please?

I mean, in eleven years in power they’ve tried one proper liberal thing, and cocked it up by introducing more state powers at the same time.

And now, they’re talking about cutting taxes, but doing so in a cackhanded way. And the cackhandedness of the act may well nullify any benefit to be had from it.

First off, they want to increase taxes on those earning the most money. Now, I’m pretty far from that tax bracket, and I very much doubt that I’ll ever reach it. But just because it won’t be stealing more from me doesn’t mean that I’m for it; saying that tax increases are grand because they’ll never effect you is fucking wrong. That’s like saying that burglary on council estates is fine, because I don’t live in a council estate. Or that we shouldn’t have an ambulance service because you happen to live across the road from A&E.

Plus, those on £150,000 a year can afford good lawyers; they can afford to move money about; and most of all, they can afford to move. They can take their millions and move somewhere where they won’t be arseraped for the crime of having a few quid. I read the other day that 25% of California’s taxes are paid by 144,000 individuals: do you think that the UK is much less dependent on that sort of ‘inequality’? And how do you think that the UK would cope if even 5% of those taxpayers jumped ship?

Secondly, Mr Darling is bringing out a temporary cut in VAT, to help small businesses. Wonderful, that is. Honest. Not cackhanded at all.
Oh wait…

Here’s my concern: it’s a temporary cut, so it’ll be reversed as soon as Gordon thinks he can get away with it. Which means that today, VAT is 17.5%; tomorrow, it’ll be 15% and the day after it may be 17.5% again. Three distinct VAT ‘windows’ within a fairly short amount of time, and with little or no notice.

I’ve worked in a few small businesses, and what I’ve noticed is this: nigh on all of them run their accounts on simple MS Excel spreadsheets with a fairly simple formulae on the invoices sheet: =(A36 * 0.175) to work out the VAT. Yes, it’s bad practice and yes it shouldn’t be done. But small businesses already have enough of a compliance burden without having to worry about flexible VAT rates. Now that’s going to have to change, but only for a small amount of time. And the dates are going to have to be carefully watched to see what VAT rate applies where and when. The amount of work that will need doing will rise, even if only a little bit.

Larger companies and organisations will be in a better position, because they’ll have dedicated accounting bods to sort it out. But I think you’ll be hearing a lot of cursing in the back offices of small businesses throughout the land.

They could have done it better; they could have cut a percentage point off NI and it would have been easier. They could have cut a penny off income tax. They could have cut the VAT and made it permanent. But no, they pick the complicated and annoying option that nobody had really thought of.

Fairly typical…

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