Snap General Election called

[Banquo]

Unsurprisingly, Jezza wasn't much of a hit at the CBI (vested interests and all that )

Director Dame Carolyn Fairbairn said: "It's time to see Labour open the door to real and lasting partnership with business, not stick with outdated ideologies that would close it in their face."

She said businesses shared "many of the same ambitions" as Labour on skills, climate change and "making sure that the proceeds of growth are felt across the country".

"The challenge is not what Labour want to achieve, it's how."

She welcomed "greater flexibility" on the apprenticeship levy and "a step up" in vocational training - another key policy area championed by Mr Corbyn this morning,

However, she said "false instincts for mass nationalisations and forcing inclusive ownership schemes onto thriving businesses does little more than frighten off investors from backing the UK, with pensioners and savers having to foot the bill."

[Puja]

I personally liked the bit of cognitive dissonance served up by Boris at the same event. It's a truism of the current Conservative party that the best way to higher tax revenues is cutting corporation tax and that raising it to 2011 levels, as Labour have suggested, is nothing short of economic vandalism. Yet today, Boris announced that he was cancelling a corporation tax cut, as the country couldn't currently take the drop in tax revenue.

Puja

[Banquo]

I personally liked the bit of cognitive dissonance served up by Boris at the same event. It's a truism of the current Conservative party that the best way to higher tax revenues is cutting corporation tax and that raising it to 2011 levels, as Labour have suggested, is nothing short of economic vandalism. Yet today, Boris announced that he was cancelling a corporation tax cut, as the country couldn't currently take the drop in tax revenue.

Puja

That's not cognitive dissonance, that's playing down to the crowd outside the hall. I am surprised that JC went tbh.

[Stom]

The company that is not being supported is using labour, using capital, using... and those things can be returned into the market.

However I'm not entirely convinced so many firms would be forced under by such change, it doesn't broadly make a difference if costs go up in a sector for a given firm providing they go up across all firms in the sector. Over time there would be a shift as the firms who manage the affairs better start to enjoy a competitive advantage, but then that advantage will be competed away (though obviously never perfectly)

I would say the idea that corporation tax be scrapped for being a tax on capital income at a corporate level is hardly new, I was at uni just into this century and it wasn't new thinking then, though at the time by big interests outside our given reading matter were sustainability and competitive advantage (and actually agricultural economics as my Uni had a huge agrics. dept. and from meeting those students and some of the talks put on I got a little interested in that, but more on the historical economics side). I didn't start to think myself about a shift towards such large scale changed to the tax structure until maybe a decade or so later, also about a decade ago.

At school and college, I did feel tax needed some reform, but my opinion was definitely formed by those I was around. Given some of the economic and political events we got to attend were those organised by the Young Tories, Liam Fox, and other Tories, my views as an 18 year old were very different to what they are now, after years living in the real world.

Given that at 20 I was involved with Boris' London Mayor election campaign...

Jeez, I was a dick who knew nothing back then.

Now, I can see how any threat to a pension pot someone like Banquo feels like he has fairly grown is greeted by scorn.

But I can also see how society needs a bit of change to work for the many. Young people have it both easier than ever and harder than ever.

And that clash often has the job market and therefore economic policy at its heart.

Finding a balance to that is difficult, but we never said politics was easy!

My biggest problem with the current Labour leadership is their lack of respect for the sheer difficulty of the task ahead.

My biggest problem with the current government is that they don't give a toss for the difficulty if they can line their own pockets.

Boris Johnson's previous conduct should mean he is ineligible for office, not that he is Prime Minister!!!

Why no-one is talking about it in more detail I have no idea.

He is not to be trusted, he has no backbone, and he only cares about himself. Why the hell would you want to CHOOSE him as your Prime Minister!!!

I don't 'feel' I have fairly grown it, I have fairly grown it . But ok, come after me again, its not like I haven't paid a fortune in taxes over a 37 year working career.....and never avoided them (well other than pension contributions and ISA's). Being a shareholder directly or indirectly is not a bad thing.

Saying you "feel" something isn't disparaging at all, and it's not intended as such.

[Son of Mathonwy]

For me I'd much rather be able to tax dividends than corporation tax as that taxes distributed income and leaves the companies more incentivised to invest. There might need to be consideration additionally given to companies storing capital in investments, but we're seeing that happen now anyway

And of course corp tax supports bad/worse companies, the money has to be raised somewhere, so if the non profit making companies aren't paying their share the slack is being picked up elsewhere

I remain confused about how bad/worse companies are being supported by corporation tax. The money doesn't go back to the worse companies and it's not a case that crap companies are somehow getting in a plum situation by profitable companies paying tax. Granted, if a company continually makes a loss, then they won't pay tax, but they'll also continually make a loss which doesn't seem like much of a loophole (accountancy shenanigans aside).

Puja

It's simply about efficiency, I'm happier to see the companies making a loss forced out of the market, and resources being up by companies making a profit.

1) Bankruptcy destroys value, creditors are not paid, the value of a going concern is much greater than the value of the assets that get sold off. Not to mention the human cost.

2) With every participant that gets removed from the industry, it moves further away from perfect competition; the remaining players closer to monopolists. This makes things less efficient.

[Son of Mathonwy]

For me I'd much rather be able to tax dividends than corporation tax as that taxes distributed income and leaves the companies more incentivised to invest. There might need to be consideration additionally given to companies storing capital in investments, but we're seeing that happen now anyway

And of course corp tax supports bad/worse companies, the money has to be raised somewhere, so if the non profit making companies aren't paying their share the slack is being picked up elsewhere

Dividends are taxed - within income tax.

A company that neither pays nor receives from the state can hardly be said to be being supported. That's like saying a homeless person is being supported by the state (hey, they don't pay tax do they?).

If a company has a couple of tough years (which often happens when starting up), do you really want the state to push them over the edge into bankruptcy?

The company that is not being supported is using labour, using capital, using... and those things can be returned into the market.

However I'm not entirely convinced so many firms would be forced under by such change, it doesn't broadly make a difference if costs go up in a sector for a given firm providing they go up across all firms in the sector. Over time there would be a shift as the firms who manage the affairs better start to enjoy a competitive advantage, but then that advantage will be competed away (though obviously never perfectly)

I would say the idea that corporation tax be scrapped for being a tax on capital income at a corporate level is hardly new, I was at uni just into this century and it wasn't new thinking then, though at the time by big interests outside our given reading matter were sustainability and competitive advantage (and actually agricultural economics as my Uni had a huge agrics. dept. and from meeting those students and some of the talks put on I got a little interested in that, but more on the historical economics side). I didn't start to think myself about a shift towards such large scale changed to the tax structure until maybe a decade or so later, also about a decade ago.

This tax would favour some sectors over others, namely those with high net profit margins.

Also, since expenses would no longer reduce the figure which is taxed, companies would seek to cut them further than they do under the current system. So this would discourage R&D spending (amongst other things).

[Son of Mathonwy]

If you don't believe me, ask yourself why, across the world, corporation tax is based on profits? If your idea worked, why is no one doing it? (This doesn't prove you wrong, but it suggests you need to come up with a detailed explanation of how it will work.)

it turns out someone is sort of doing it, the mighty Estonia, I've taken this from a website called something like Work in Estonia (it might have been Live in Estonia)

"The income tax rate for private entrepreneurs and corporations is 20%.

Corporate earnings taxation in Estonia is truly unique – it shifts the moment of corporate taxation from the moment of earning the profits to the moment of their distribution.

This means that earning profit in itself does not trigger income tax liability. The tax obligation arises only when earnings are distributed to shareholders. If the profit distributed to shareholders originates from dividends received from a subsidiary or permanent establishment in another country, there’ll be no tax to pay on profit distribution."


The thing about noting this is I don't want to limit the conversation to a particular plan on what should replace corporation tax, partly because I wouldn't want to discuss it with a diagnosis already in mind, and partly I've never put the time and effort into devising a new tax system, I'm probably not odd in not doing that but you never know. I'm merely of a view that taxing business activity and/or taxing distributed income is a much more efficient model than taxing capital income. I'm not in advance thinking the Estonia model offers a huge amount to us, it might, but I suspect they've a much younger working population, entirely different demographics around their retired and retiring population, entirely difference pension schemes,

So Estonia taxes net profit, but only on the part which is distributed as dividends? Weird. I think my life is too short to wonder too deeply why they do this .

In the end, re tax on companies, the truth is that in the UK only a small % of overall tax comes from corporation tax. So in theory they could dispense with the whole thing... if they were able to increase other taxes to take its place. But that's politically difficult and it is of course less risky to collect taxes in a variety of ways (less volatile).

[Which Tyler]

[Banquo]

At school and college, I did feel tax needed some reform, but my opinion was definitely formed by those I was around. Given some of the economic and political events we got to attend were those organised by the Young Tories, Liam Fox, and other Tories, my views as an 18 year old were very different to what they are now, after years living in the real world.

Given that at 20 I was involved with Boris' London Mayor election campaign...

Jeez, I was a dick who knew nothing back then.

Now, I can see how any threat to a pension pot someone like Banquo feels like he has fairly grown is greeted by scorn.

But I can also see how society needs a bit of change to work for the many. Young people have it both easier than ever and harder than ever.

And that clash often has the job market and therefore economic policy at its heart.

Finding a balance to that is difficult, but we never said politics was easy!

My biggest problem with the current Labour leadership is their lack of respect for the sheer difficulty of the task ahead.

My biggest problem with the current government is that they don't give a toss for the difficulty if they can line their own pockets.

Boris Johnson's previous conduct should mean he is ineligible for office, not that he is Prime Minister!!!

Why no-one is talking about it in more detail I have no idea.

He is not to be trusted, he has no backbone, and he only cares about himself. Why the hell would you want to CHOOSE him as your Prime Minister!!!

I don't 'feel' I have fairly grown it, I have fairly grown it . But ok, come after me again, its not like I haven't paid a fortune in taxes over a 37 year working career.....and never avoided them (well other than pension contributions and ISA's). Being a shareholder directly or indirectly is not a bad thing.

Saying you "feel" something isn't disparaging at all, and it's not intended as such.

Cool- was only mildly jesting myself

[Digby]

If you don't believe me, ask yourself why, across the world, corporation tax is based on profits? If your idea worked, why is no one doing it? (This doesn't prove you wrong, but it suggests you need to come up with a detailed explanation of how it will work.)

it turns out someone is sort of doing it, the mighty Estonia, I've taken this from a website called something like Work in Estonia (it might have been Live in Estonia)

"The income tax rate for private entrepreneurs and corporations is 20%.

Corporate earnings taxation in Estonia is truly unique – it shifts the moment of corporate taxation from the moment of earning the profits to the moment of their distribution.

This means that earning profit in itself does not trigger income tax liability. The tax obligation arises only when earnings are distributed to shareholders. If the profit distributed to shareholders originates from dividends received from a subsidiary or permanent establishment in another country, there’ll be no tax to pay on profit distribution."


The thing about noting this is I don't want to limit the conversation to a particular plan on what should replace corporation tax, partly because I wouldn't want to discuss it with a diagnosis already in mind, and partly I've never put the time and effort into devising a new tax system, I'm probably not odd in not doing that but you never know. I'm merely of a view that taxing business activity and/or taxing distributed income is a much more efficient model than taxing capital income. I'm not in advance thinking the Estonia model offers a huge amount to us, it might, but I suspect they've a much younger working population, entirely different demographics around their retired and retiring population, entirely difference pension schemes,

So Estonia taxes net profit, but only on the part which is distributed as dividends? Weird. I think my life is too short to wonder too deeply why they do this .

In the end, re tax on companies, the truth is that in the UK only a small % of overall tax comes from corporation tax. So in theory they could dispense with the whole thing... if they were able to increase other taxes to take its place. But that's politically difficult and it is of course less risky to collect taxes in a variety of ways (less volatile).

You don't need to wonder, it's a more efficient model than taxing capital income, and do can still arrive at whatever you perceive as 'fair' by whatever model you have to tax distributed income.

I agree it's politically difficult to change something like corporation tax, it's much easier to stand up and lie abut cutting taxes and increasing spending on houses, police, hospitals, pensions, animals.... but we do need to address our productivity, and the idea of remodelling corporation tax is a well known one, popular even, albeit not enjoying universal backing from economists

[Which Tyler]

Tactical voting made easy (if you want to stop No Deal, or Boris's hard Brexit):
1) Look up the 2017 results for your constituency,
2) vote for the the most popular non-Tory party.

For me that's Labour (another wasted vote for a candidate with a strong majority...but what else can I do?).

One of the tactical voting sites includes the results from the other sites; and is serachable by constituency: https://tactical.vote/compare?ru=1&couk=1&pv=1&bfb=1
I don't know how often, or even if at all the various sites update their suggestions

[Stom]

If you don't believe me, ask yourself why, across the world, corporation tax is based on profits? If your idea worked, why is no one doing it? (This doesn't prove you wrong, but it suggests you need to come up with a detailed explanation of how it will work.)

it turns out someone is sort of doing it, the mighty Estonia, I've taken this from a website called something like Work in Estonia (it might have been Live in Estonia)

"The income tax rate for private entrepreneurs and corporations is 20%.

Corporate earnings taxation in Estonia is truly unique – it shifts the moment of corporate taxation from the moment of earning the profits to the moment of their distribution.

This means that earning profit in itself does not trigger income tax liability. The tax obligation arises only when earnings are distributed to shareholders. If the profit distributed to shareholders originates from dividends received from a subsidiary or permanent establishment in another country, there’ll be no tax to pay on profit distribution."


The thing about noting this is I don't want to limit the conversation to a particular plan on what should replace corporation tax, partly because I wouldn't want to discuss it with a diagnosis already in mind, and partly I've never put the time and effort into devising a new tax system, I'm probably not odd in not doing that but you never know. I'm merely of a view that taxing business activity and/or taxing distributed income is a much more efficient model than taxing capital income. I'm not in advance thinking the Estonia model offers a huge amount to us, it might, but I suspect they've a much younger working population, entirely different demographics around their retired and retiring population, entirely difference pension schemes,

So Estonia taxes net profit, but only on the part which is distributed as dividends? Weird. I think my life is too short to wonder too deeply why they do this .

In the end, re tax on companies, the truth is that in the UK only a small % of overall tax comes from corporation tax. So in theory they could dispense with the whole thing... if they were able to increase other taxes to take its place. But that's politically difficult and it is of course less risky to collect taxes in a variety of ways (less volatile).

Estonia have created a new ecosystem for tech and digital companies. Many new agency startups with remote teams, startups in the crypto space, or other tech startups establish their company in Estonia so they can avoid regulation on bank account usage, invoicing, and taxation in their home country (we're looking at Hungary, Romania, Serbia, Slovakia, Poland, etc., etc., here, where bank fees are high but you need to have a physical bank account, unlike in the UK where you can use a digital bank).

It's kind of a trial and they want to encourage companies to start there and keep their money in the system (hey, TransferWise is Estonian...).

But because so many companies use crypto, it can be quite easy to game it.

I work with 2 Estonian digital companies right now, and am thinking of setting up my own in the future.

Of course, any salary you take out is taxable in your home country.

[Son of Mathonwy]

it turns out someone is sort of doing it, the mighty Estonia, I've taken this from a website called something like Work in Estonia (it might have been Live in Estonia)

"The income tax rate for private entrepreneurs and corporations is 20%.

Corporate earnings taxation in Estonia is truly unique – it shifts the moment of corporate taxation from the moment of earning the profits to the moment of their distribution.

This means that earning profit in itself does not trigger income tax liability. The tax obligation arises only when earnings are distributed to shareholders. If the profit distributed to shareholders originates from dividends received from a subsidiary or permanent establishment in another country, there’ll be no tax to pay on profit distribution."


The thing about noting this is I don't want to limit the conversation to a particular plan on what should replace corporation tax, partly because I wouldn't want to discuss it with a diagnosis already in mind, and partly I've never put the time and effort into devising a new tax system, I'm probably not odd in not doing that but you never know. I'm merely of a view that taxing business activity and/or taxing distributed income is a much more efficient model than taxing capital income. I'm not in advance thinking the Estonia model offers a huge amount to us, it might, but I suspect they've a much younger working population, entirely different demographics around their retired and retiring population, entirely difference pension schemes,

So Estonia taxes net profit, but only on the part which is distributed as dividends? Weird. I think my life is too short to wonder too deeply why they do this .

In the end, re tax on companies, the truth is that in the UK only a small % of overall tax comes from corporation tax. So in theory they could dispense with the whole thing... if they were able to increase other taxes to take its place. But that's politically difficult and it is of course less risky to collect taxes in a variety of ways (less volatile).

You don't need to wonder, it's a more efficient model than taxing capital income, and do can still arrive at whatever you perceive as 'fair' by whatever model you have to tax distributed income.

I agree it's politically difficult to change something like corporation tax, it's much easier to stand up and lie abut cutting taxes and increasing spending on houses, police, hospitals, pensions, animals.... but we do need to address our productivity, and the idea of remodelling corporation tax is a well known one, popular even, albeit not enjoying universal hacking from economists

I'm not sure why you describe the Estonian system as efficient: it's nothing like the system you've been advocating.

It's a tax on net profit (just like every other country); the only difference is that the tax only becomes liable if a dividend is paid. So it is a tax on profit (which you have said is inefficient), but with the twist that it encourages companies to retain profits to reinvest in the business.

[Digby]

So Estonia taxes net profit, but only on the part which is distributed as dividends? Weird. I think my life is too short to wonder too deeply why they do this .

In the end, re tax on companies, the truth is that in the UK only a small % of overall tax comes from corporation tax. So in theory they could dispense with the whole thing... if they were able to increase other taxes to take its place. But that's politically difficult and it is of course less risky to collect taxes in a variety of ways (less volatile).

You don't need to wonder, it's a more efficient model than taxing capital income, and do can still arrive at whatever you perceive as 'fair' by whatever model you have to tax distributed income.

I agree it's politically difficult to change something like corporation tax, it's much easier to stand up and lie abut cutting taxes and increasing spending on houses, police, hospitals, pensions, animals.... but we do need to address our productivity, and the idea of remodelling corporation tax is a well known one, popular even, albeit not enjoying universal hacking from economists

I'm not sure why you describe the Estonian system as efficient: it's nothing like the system you've been advocating.

It's a tax on net profit (just like every other country); the only difference is that the tax only becomes liable if a dividend is paid. So it is a tax on profit (which you have said is inefficient), but with the twist that it encourages companies to retain profits to reinvest in the business.

I don't think at any point I've raised a problem with tax bring levied on capital withdrawn from the company, I've commented that tax on capital income is a bad idea, and this is one alternative, albeit far from the only one

[kk67]

Silly fecks being feckwits.

[Son of Mathonwy]

You don't need to wonder, it's a more efficient model than taxing capital income, and do can still arrive at whatever you perceive as 'fair' by whatever model you have to tax distributed income.

I agree it's politically difficult to change something like corporation tax, it's much easier to stand up and lie abut cutting taxes and increasing spending on houses, police, hospitals, pensions, animals.... but we do need to address our productivity, and the idea of remodelling corporation tax is a well known one, popular even, albeit not enjoying universal hacking from economists

I'm not sure why you describe the Estonian system as efficient: it's nothing like the system you've been advocating.

It's a tax on net profit (just like every other country); the only difference is that the tax only becomes liable if a dividend is paid. So it is a tax on profit (which you have said is inefficient), but with the twist that it encourages companies to retain profits to reinvest in the business.

I don't think at any point I've raised a problem with tax bring levied on capital withdrawn from the company, I've commented that tax on capital income is a bad idea, and this is one alternative, albeit far from the only one

Dividends are an example of capital income.

[Son of Mathonwy]

I think Corbyn was pretty effective in last night's debate. No knockout blows, but I thought it went well from Labour's perspective.

We shall see if it makes any difference in the polls.

[Digby]

I'm not sure why you describe the Estonian system as efficient: it's nothing like the system you've been advocating.

It's a tax on net profit (just like every other country); the only difference is that the tax only becomes liable if a dividend is paid. So it is a tax on profit (which you have said is inefficient), but with the twist that it encourages companies to retain profits to reinvest in the business.

I don't think at any point I've raised a problem with tax bring levied on capital withdrawn from the company, I've commented that tax on capital income is a bad idea, and this is one alternative, albeit far from the only one

Dividends are an example of capital income.

But distributed

[Digby]

I think Corbyn was pretty effective in last night's debate. No knockout blows, but I thought it went well from Labour's perspective.

We shall see if it makes any difference in the polls.

On Today earlier it was noted in analysis both candidates failed to answer actual questions asked and the audience openly laughed at answers from both. Is this what counts as going well?

[Banquo]

I think Corbyn was pretty effective in last night's debate. No knockout blows, but I thought it went well from Labour's perspective.

We shall see if it makes any difference in the polls.

view seemed to be that as Boris didn't fck up, score draw. Twitter row likely more damaging to Tories.

[Son of Mathonwy]

I think Corbyn was pretty effective in last night's debate. No knockout blows, but I thought it went well from Labour's perspective.

We shall see if it makes any difference in the polls.

view seemed to be that as Boris didn't fck up, score draw. Twitter row likely more damaging to Tories.

Agreed that misleading the public on Twitter should hurt the Tories. It's blatant, and easy to understand, even if you're not into the issues.

[Mellsblue]

Per a couple of points above. YouGov polls:
‘Leaving aside your one party preference, who do you think performed best overall in tonight’s debate’: Boris 51% v 49% JC
26% thought that both Boris and JC did well....

More stats here:

https://d25d2506sfb94s.cloudfront.net/c ... 1119_w.pdf

[Mellsblue]

I think Corbyn was pretty effective in last night's debate. No knockout blows, but I thought it went well from Labour's perspective.

We shall see if it makes any difference in the polls.

view seemed to be that as Boris didn't fck up, score draw. Twitter row likely more damaging to Tories.

Twitter is damaging for Conservatives full stop.

[Puja]

Per a couple of points above. YouGov polls:
‘Leaving aside your one party preference, who do you think performed best overall in tonight’s debate’: Boris 51% v 49% JC
26% thought that both Boris and JC did well....

More stats here:

https://d25d2506sfb94s.cloudfront.net/c ... 1119_w.pdf

A few interesting points coming out of that data*:

Corbyn was the significant winner amongst people who had not yet decided on who they were going to vote for. He also got 67% of people thinking he did well, compared with 59% for Johnson. 44% of 2017 Conservative voters thought he did well, as opposed to 33% of of 2017 Labour voters for Johnson.

Given the pre-existing anti-Corbyn personal animus, you'd have to say that a debate where he came level with Johnson as an individual was a pretty solid result. I'd've been interested if the poll had been taken both before and after, to see whether any minds had been changed or if people had just heard what they wanted to hear and blanked out anything else (the stats on who won for the various age groups suggest the latter!).

Puja

*with the obvious caveat that stats can be made to say anything you want and, with my prexisting opinion that Johnson is a bloviating fucktrombone, I'm a touch biased in which ones I pull out.

[Mellsblue]

Per a couple of points above. YouGov polls:
‘Leaving aside your one party preference, who do you think performed best overall in tonight’s debate’: Boris 51% v 49% JC
26% thought that both Boris and JC did well....

More stats here:

https://d25d2506sfb94s.cloudfront.net/c ... 1119_w.pdf

A few interesting points coming out of that data*:

Corbyn was the significant winner amongst people who had not yet decided on who they were going to vote for. He also got 67% of people thinking he did well, compared with 59% for Johnson. 44% of 2017 Conservative voters thought he did well, as opposed to 33% of of 2017 Labour voters for Johnson.

Given the pre-existing anti-Corbyn personal animus, you'd have to say that a debate where he came level with Johnson as an individual was a pretty solid result. I'd've been interested if the poll had been taken both before and after, to see whether any minds had been changed or if people had just heard what they wanted to hear and blanked out anything else (the stats on who won for the various age groups suggest the latter!).

Puja

*with the obvious caveat that stats can be made to say anything you want and, with my prexisting opinion that Johnson is a bloviating fucktrombone, I'm a touch biased in which ones I pull out.

It’s true you can make statistics say anything you want:
a) Conservative voters not part of a cult and therefore more reasonable and level headed with regards opposition politicians.
b) Johnson wins, making it a literal victory, a moral victory, a red, white and blue victory and a Churchillian victory.
c) Corbyn suffers from pre-existing personal animus but bloviating fucktrombone Johnson does not.
d) Corbyn repeats trick from 2017 of being victorious/level despite stats showing that he lost.
e) Corbynites on Twitter saying YouGov is a bias tool of the Conservative party until realising they had Corbyn winning amongst swing voters. Upon which, there was a volte fact to saying YouGov’s results are beyond question.