back to article Small biz grits teeth over Bloody George's budget

Reaction to George Osborne's emergency Budget is mixed this morning, with most business leaders accepting the need for higher VAT and welcoming the cuts in corporation tax, while unions condemn him for a "vintage Thatcher" budget. The Confederation of British Industry accepted the need for VAT rises, welcomed changes to Capital …

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FAIL

@ Unite General secretary Derek Simpson

"This budget is vintage Thatcher. The Lib Dems have been conned into hammering the poor, choking off investment and cuts that risk plunging this country into a longer and deeper recession."

Not wanting to burst your bubble of hate for the Coalition (you know, the people that got the most votes) but... Oh wait, I do...

I'm guessing that (being high up in the unions) you're a massive Labour supporter. It's pretty obvious that you hate Thatcher and as such can't abide the thought of any government that has a link with her.

I'm also guessing that you quietly forget the fact that it's because of the MASSIVE debt generated by New Labour that this is happening in the first place.

I'm also going to assume that WHATEVER the Coalition do to sort out the mess left by Labour, you will scream and shout and jump up and down and wave your arms about and complain that it's affecting the wrong people even though these cuts and increases in taxes simply must happen to deal with the MASSIVE, record levels of debt left to us by Labour.

Besides, the new budget is very lenient to the lowest earners, but maybe those people can't afford to be in your union eh?

"This budget is vintage Thatcher. The Lib Dems have been conned into hammering the poor, choking off investment and cuts that risk plunging this country into a longer and deeper recession."

The Lib Dems are no longer a small part of this, in fact, they are a huge part of the solution rather than trying to exasperate and be part of the problem, like you.

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WTF?

RE: lenient to the lowest earners

Which planet do you live on? The lowest earners and a lot of people above that live week to week trying to manage on the little money they have, after this budget they are WORSE off, it's a simple arithmetic sum which I'm sure most people can manage.

If you already spend every penny you earn you are now going to have to manage with buying less, a lot more people are going to slip into poverty from this. Mean while big businesses get huge benefits which will go to shareholders/directors bonuses.

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Arsehole

The rate of VAT affects those on low incomes far more than those on higher incomes. Those below £10,000 a year pay £1 in every £7 in VAT whilst those on about £100,000 pay £1 in every £25 in VAT. See Office of National Statistics table 14:

http://www.statistics.gov.uk/downloads/theme_social/Taxes-Benefits-2007-2008/Taxes_benefits_0708.pdf

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Silver badge

Personal allowance rise?

This is probably way off, but: assume that person X earns £10000. The £1000 increase in personal allowance gives him £200 in his pocket extra. In order to have that soaked up by the VAT increase at 2.5%, he needs to spend £8000 on VATable items, which don't include food, children's clothes and books. That seems like a lot.

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Anonymous Coward

@ vic4

"after this budget they are WORSE off"

EVERYONE is worse off thanks to Labour, that's the point. It's no good blaming a government that's been handed a complete tatters of an economy when they have to start making the tough choices.

Also, less public sector money, GOOD!

That's less money to set up useless, bureaucrat generating, legislation pushing Quangos, i.e. the interfering Nanny state.

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title goes here

jeez vic i sure hope you dont get cancer in the next few years...

actually on reflection i hope you never get it. :-)

while public sector waste is very real. the crap that it's wasted on is the pet projects of senior management, and they will be insulated from the effects of the cuts. The cuts will devastate frontline services.

And as for the people pointing out that it was a labour govenment that got us in the ca-ca in the first place - i beg to differ. we havent had a labour govenment in this country since '79. and THAT'S why we are in the shite.

the economy didnt tank because of all the schools and hospitals that got built, it tanked because some twat in the city took the economy to monte carlo and put it all on red, aided and abeited by balir and brown. Just how can that be attributed to a genuine labour movement?

New labour was just a bunch of middle class tossers thinking they were morally superior to greedy grasping capitalist tories because they professed to have sympathy with the working man. They weren't they were just arrogant.

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FAIL

And so it is, but why ?

"The rate of VAT affects those on low incomes far more than those on higher incomes. Those below £10,000 a year pay £1 in every £7 in VAT whilst those on about £100,000 pay £1 in every £25 in VAT. See Office of National Statistics table 14:"

Well, yes, so it appears, but then ask yourself this, what is it exactly that the low income chappie is buying that is vatable as opposed to the high income chappie who seems to be spending his disposable wodge on things that are zero rated ?

Since the only things that are zero rated are essentials like food and children's clothing, you would expect that the low income group would be splashing most of their hard earned pennies in that direction. Only they aren't. Until you can explain that, this figure means nothing.

Unless of course, the evil rich are spending their ill gotten gains on food and clothing for their children, the utter bastards!

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Anonymous Coward

sigh

Just because you can't be bothered following his link doesn't mean it isn't true.

Not all foods are zero rated but there are many other things which are either zero rated or at the reduced rate, including sports activities or alterations to listed buildings, so things like a golf or pony club membership or converting the outbuildings of a stately home into a granny flat are VAT exempt.

Also, if you're on a low income it's likely that you will be spending all of that income every month, mostly on goods. People on higher incomes are more likely to be spending money on mortgage payments or paying into savings, neither of which are taxed.

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Stop

RE: EVERYONE is worse off thanks to Labour

I never claimed that was not the case. My point was in reaction to someone who claimed those with the lowest earnings had been treated leniently.

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Anonymous Coward

We used to live in a box, at the bottom of a lake.

I remember we had to get up every morning, and before breakfast we had to drink the lake clean.

I remember when kids could count, because they did times tables and hundreds tens and units.

I remember when kids could spell, because they did 'duh' and 'a!" spells 'da'.

I remember Gordon Brown in Mansion House telling the banks that the government fully supported them lending to anyone, because it will help them get re-elected.

And you tell kids today, and they don't believe you.

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IR35

Anybody know if this is still being scrapped or are they keeping it ?.

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RE: IR35

The intention to review it is still there, just not got around to it

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Unhappy

The title is required, and must contain letters and/or digits.

and that review may come up with something a lot less avoidable.....

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FAIL

"Vintage Thatcher"

I think not.

Letting 880k off the bottom of the tax system *entirely*

Rather on the damp side of Thatcherite behavior.

No public sector pay rises for earners *over* £21k

I'd say that's that would be the reverse of her policy.

Minimum wage not abolished.

Thinking the the plebs had some sort of *right* to a wage they could live on.

A levy on UK banks to protect depositors.

Practically Marxist.

All told a budget practically slopping with wetness and guaranteed to make the rust spots start breaking out on the iron lady.

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FAIL

Off the tax system

> Letting 880k off the bottom of the tax system *entirely*

Yeah and then hitting them with extra VAT and cuts working out at a figure of more than the (up to ) 200 pound the tax break gives them. What about those already below the tax limit, they don't even get any more cash back from tax.

> A levy on UK banks to protect depositors.

Banks should shoulder lot of responsibility for the state of affairs AND paying the consequences. This is nowhere enough imposed on them.

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You have to wonder if the Federation of Small Business

couldn't have chosen a name with a less unfortunate acronym than FSB, perhaps they could have been the Klan of Great Businesses instead?

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The striking thing

The one aspect of this budget which stands out as grossly and randomly unfair is the CGT change.

And who's baby was that? Cuddly Uncle Vince.

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Silver badge

Vince was right, then.

Because the CGT modifications are to *encourage entrepreneurs*. What's the point of starting a new business if the government's just going to cream off most of your profits?

Yes, it means some greedy buggers who inherited their money will benefit, but these are rare. Entrepreneurs who are earning this kind of money will also be *employing other people*, who will contributing to the country's coffers too, rather than signing-on.

Labour once had a 98% tax rate for very high earners... prompting those high earners to leave the country. Result? The *poorer* people ended up paying for the financial shortfall. It's a fine balancing act.

All things considered, this budget isn't bad, and could have been a lot worse. At least they weren't so stupid as to cancel or drastically cut back spending on Crossrail and Thameslink, (though cutting some of the planned electrification is short-sighted; infrastructure improvements pay for themselves over the long term).

My hope is that we'll see some movement towards a Land Value Tax system once the worst is over, though this won't be easy to get past the huge number of landowners in the Tory party.

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Anonymous Coward

The reaction from the unions and Ms Harperson yesterday

comes across as outward-directed anger at having, between them, having nobody else to blame for having finally knocked the nails into the Labour movement's coffin.

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Flame

Union Leaders and Egoism

When will the cretins who head up the unions (who have been desperately quiet as Labour flushed billions down the toilet) stop thinking of how history will remember them (normally as a pompous morons with astronomical salaries and perks and a strange doublethink where they identify themselves as 'Marxist' or even 'Trotskyisk').

Every time I hear a union leader waffling on about Thatcher (get over it), I think of that arsehole who put his own arrogance and pathetic little crusade against The Man over the pay and conditions of firemen. Anyone with a picture of that well known Terrorist Ernesto Guvarra in teh background while they are pontificating on the ills of the capistalist system needs a knock from the boys in black.

They need to GROW UP and deal with the realities of the UK's situation. I am glad we finally have a government that isn't just coasting along, wasting money and pretending everything is fine. It isn't.

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Happy

Perhaps...

Instead of just saying "Derek Simpson, the general secretary of Unite", you could also add "the union that will be most heavily affected by public service job cuts which in turn will make it very difficult for Mr Simpson to justify his £140,000+ salary+benefits package on top of his grace-and-favour home and other benefits".

While I have sympathy for those affected by the job cuts, the last government used the public service as a way of hiding unemployment during a period of increased tax revenue which was unsustainable due to the dependence on revenue from the financial services industry and the housing boom.

When the banking crisis occured, suddenly all that tax revenue disappeared and Gordon started printing money but at some point the UK had to face reality.

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Grenade

Am I on the same planet?

I've always thought of myself as socialist (but not NU Labor), I'm even a member and rep for UNITE, but the hyperbole being spread around what was a very reasonable budget is incredible.

I'm not particularly well off as far as I know, but I'm willing to do my part - the bonfire of the quangos that is currently going on is MUSIC to my ears, at least if I pay a higher tax rate now less of it gets wasted by those bloody pointless exercises in money movement.

I'm still waiting until the Autumn to see if the other shoe drops - but do people SERIOUSLY think that the tories are in it exclusively to f**k the rest of the country over? That the ghost of Thatcher is haunting the corridors of power, after the length of time since her departure?

I'm hoping my first instinct was right, straight after the election results - it's the hard-nosed sense of the tories, with a grafted-on conscience via the Lib Dems.

Sudanese LGBT Football Co-ordinators - find a job!

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Unhappy

Yes

"but do people SERIOUSLY think that the tories are in it exclusively to f**k the rest of the country over? "

Yes, yes they do. One union rep of my acquaintance who IS very New Labour (actually cried when Gordon resigned, FFS) honestly believes that the plan is to fuck up the country and make everyone poor, because somehow by making the recession much worse on purpose, the evil rich tories will all make even more massive piles of gold. Because of Thatcher.

Sad, but true.

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Dear Unite...

The economy is pretty f*cked. The threat of a "downgrading" was becoming dangerously real (and look what that did to Greece). Somebody, somewhere, took a step back and a cold hard look at what to do about things to attempt to salvage the economy after many years of (typical) Labour abuse (look at the '70s (i.e. "last time")). Perhaps people are only blaming Thatcher because Labour apologists are STILL blaming her for everything, despite there being a Labour government in power for, oh, only the last year or two, not enough to make any useful changes...

Of course, it isn't a perfect budget; we'd like free beer, no VAT, and state pensions rivalling those in, say, France or <cough> Poland. But such things, while being crowd pleasers, will just dig an even deeper hole.

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Apart from the 20% VAT

...I thought this a rather good budget for the self-employed (such as IT contractors): lower Corporation Tax, higher personal PAYE allowance, a raise in the company NI floor - thank you very much ToryLibs!

Now as long as they don't fuck about with the Flat Rate VAT rates all should be quite good, relatively speaking ;-)

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The public sector

is going to have to grit its teeth, bend over, and take it the shitter like the rest of us until the debt is paid.

That is all. There is nothing special about a mouthy trot with a sense of entitlement, get over it. If you want to complain about the state of the economy, Gordon's constituency office address is in the book, send him a letter. Or some dog shit, whatever.

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Happy

public sector - more fun than seding a letter

I work in a supermarket. We get blank "grass up your customers that have bought a tv forms" that we fill in for every tv or tv recieving hardware, we sell. Anyone want to guess how many tvs my local mp (i did not vote for him) "bought" in the past 5 years????

Anyone want to send their local mp, a free letter from the tv licensing mob???

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The unions need to do their share not whine

The IFS and others have shown that a person on £10K/year will be £20/year worse off. 40p/week. Or put it another way just 1/5th of 1% of that £10K income.

No one wants the poor made more poor but this kind of 'worse off' is way less than the rounding errors in any model that also deals with numbers like £155 billion. Even if real, 40p/week is also within the discretionary spending of even someone earning only £10K/year. In other words, this budget is neutral for such people which is what you'd hope.

The solution for such people isn't more state largess but the opportunity to earn more because the economy supports earning more by everyone.

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