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UK; Increases in Council Tax 4.99% to be used on services, is instead going on wages

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Do you even need corporation tax if you properly tax capital gains and dividend income?

I'd also scrap NI.

I'd be for having just two taxes:

1) Personal income - tax on salary, dividends, capital gains, imputed rent from land/property ownership. All at the same rate e.g. 25% for first £20k, 35% for next £40k and 45% >£60k

2) Health tax - duty on cigarettes, harmful drugs, petrol etc. Could also be called externalities tax.

The imputed rent tax would replace both council tax and stamp duty. It would be rated at 4% per annum of house price.

Taxes would be payable by all, no exceptions.

Corporation tax would still be needed otherwise foreign shareholders would getting their slices of the profits tax free
And yeah national insurance i should have specified I'd scrap too as all it is is a rather oddly wirked out extra income tax
 

Zaph

Member
Do you guys pay rent on top of the council tax? Or is that for people that own real estate? I'm an American so I have no idea lol

You pay the tax to your local council wherever you live (some exclusions apply). This is separate from mortgage/rent.
 
Do you guys pay rent on top of the council tax? Or is that for people that own real estate? I'm an American so I have no idea lol

Rent is the cost of renting a house or flat i assume pretty much the same as in a america if you dont own a place you have to rent, then every household dont matter if they own or rent pays council tax
 
Do you guys pay rent on top of the council tax? Or is that for people that own real estate? I'm an American so I have no idea lol

Yes rent / mortgage is a separate payment on top of council tax

for example i pay £725pm rent and £95pm (over 10 months) council tax

bills are additional costs also
 
Corporation tax would still be needed otherwise foreign shareholders would getting their slices of the profits tax free
And yeah national insurance i should have specified I'd scrap too as all it is is a rather oddly wirked out extra income tax

The issue I have with NI is that the marginal rate falls above a certain income limit making it explicitly regressive

Most people pay their own council tax unless its like a shared house or something

Oh ok, when I lived in the UK I stayed in a shared house, so that's probably why I'm misinformed
 

danowat

Banned
I wonder if benefits will go up?






/s

890c06a5732c541f1cfd7fbe72df7128.gif
 

Rodelero

Member
Do you guys pay rent on top of the council tax? Or is that for people that own real estate? I'm an American so I have no idea lol

The responses already are pretty accurate, but there's a few other things worth knowing:

- Students don't pay, which is a huge boon for second/third year university students who no longer use in Halls of Residence

- People who live alone pay 75%

- The tax depends on the region you live in and the value of the home you live in

- Despite the above, the tax is relatively flat. The highest band is only three times the lowest. Compared to the way our income tax works, which is relatively progressive, the council tax is punitive to the poor. Naturally, it is paid by the tenant of a rental property, which is a double whammy for those already spending a fortune to accumulate no wealth whatsoever.

I don't personally have a massive issue with council tax itself, as a concept, but the tax needs to be rejigged so it takes far, far more money from those living in the most valuable properties. The fact that a Just-About-Managing couple living in a one bedroom flat will be paying a just third of what someone living in a Mansion pays is outrageous.
 
Currently paying circa £80 per month in a Band A rental, including the single occupant discount. In the middle of buying a house, that will push me up to Band C which I'm expecting to be around £120 including the discount.

This is in a town where some bright spark decided we should have rubbish collections once every three weeks from September.

Income tax, council tax, VAT, Fuel escalator, NI... I'd be interested to see how much of my monthly income goes out as tax.
 

munroe

Member
Paying just over £100 a month or around £300 for the household (3 bedroom house)

We get weekly black bin collections and fortnightly blue bin collections (Worthing)
 

Newline

Member
Mines currently £162 a month. Living in Whitechapel which is one of the cheaper boroughs of London. We don't even have large bins to put our rubbish in. Everyone's garbage is just left outside the house next to a tree. It's the same deal along the whole street.
 
I don't personally have a massive issue with council tax itself, as a concept, but the tax needs to be rejigged so it takes far, far more money from those living in the most valuable properties. The fact that a Just-About-Managing couple living in a one bedroom flat will be paying a just third of what someone living in a Mansion pays is outrageous.

Ehh, I don't agree with this. It assumes that there's a link between property value and ability to pay, which isn't always the case. What about retired people? What about people who inherited their house?

In addition, having a big house doesn't necessarily mean you use more council services, so why should those people pay more? It doesn't sound very fair to me (that's not to say that the current system is fair either btw!).
 

mrklaw

MrArseFace
I thought the poll tax seemed a reasonable idea at the time. More people live in a house, the more local services you use, so the more you pay. Now we have some weird rates-like system based on the supposed value of your property which doesn't take into account (well not properly) how many people live there or what impact you actually have on local services
 

mrklaw

MrArseFace
I also quite like the weird way they collect it. For some reason they split it into 10, rather than 12 monthly payments. As I just write off that amount each month, I sneakily enjoy having those two months at the start of the year as bonus months to buy pointless shit with.
 

milanbaros

Member?
Corporation tax would still be needed otherwise foreign shareholders would getting their slices of the profits tax free
And yeah national insurance i should have specified I'd scrap too as all it is is a rather oddly wirked out extra income tax

Why would they get it tax free? The tax would be withheld by HMRC at distribution (withholding tax). Lower tax rate payers could then claim it back.
 

milanbaros

Member?
Ehh, I don't agree with this. It assumes that there's a link between property value and ability to pay, which isn't always the case. What about retired people? What about people who inherited their house?

In addition, having a big house doesn't necessarily mean you use more council services, so why should those people pay more? It doesn't sound very fair to me (that's not to say that the current system is fair either btw!).

If you own a million pound asset, you can either afford to pay or you can sell your property and use the cash in a sustainable way.

Why should someone who makes £500k from employment, or from investing in shares have to pay income tax and capital gains, whereas millions of people have enjoyed massive increases in wealth without having to pay a penny.
 
If you own a million pound asset, you can either afford to pay or you can sell your property and use the cash in a sustainable way.

Why should someone who makes £500k from employment, or from investing in shares have to pay income tax and capital gains, whereas millions of people have enjoyed massive increases in wealth without having to pay a penny.

I think people's houses are different. They're people's homes, and telling people to sell up and move out just doesn't sit well with me. They're not just assets, although they can be. I'm very big on levying extremely high taxes on second homes. In my opinion, owning a home is a basic human requirement, but owning two homes is definitely a luxury. Especially when houses are in short supply.

As far as people enjoying massive increases in wealth, house prices are mainly going up due to massive demand and shortage of supply. The answer to that is to build more houses, not to punish people who own them.
 

krang

Member
Ok, a question that is really off-topic, but it might be for the right crowd:

Has anyone here done a self-build of their home in the UK? Looking at it as an option for when we next move.
 

milanbaros

Member?
I think people's houses are different. They're people's homes, and telling people to sell up and move out just doesn't sit well with me. They're not just assets, although they can be. I'm very big on levying extremely high taxes on second homes. In my opinion, owning a home is a basic human requirement, but owning two homes is definitely a luxury. Especially when houses are in short supply.

As far as people enjoying massive increases in wealth, house prices are mainly going up due to massive demand and shortage of supply. The answer to that is to build more houses, not to punish people who own them.

If I choose to rent my home using investment income (which I have built up using money I would have otherwise used to purchase a home). Is it right that I should pay tax on amount used for my home?

Would you be ok to make rent a tax deductible expense?
 
If I choose to rent my home using investment income (which I have built up using money I would have otherwise used to purchase a home). Is it right that I should pay tax on amount used for my home?

Would you be ok to make rent a tax deductible expense?

Whew, tough questions! I guess the best I can do here is to say that I don't really have an issue with that in principle, but there may be pitfalls associated with the implementation that I can't foresee. This stuff isn't exactly my area I'm afraid.
 
Edit - quote Quiche but not sure why so deleted that. Sorry Quiche!

It's telling that our governments (of all stripes) strive to simplify the benefits system into one payment, but like to have taxes split into multiple. Universal means-tested tax would be great. Not for transaction-based taxes of course, but the income tax, council tax, NI etc.

Of course the more complicated the tax system is, the harder it is for the average joe to establish if they're getting ripped off or not. See also: the banking sector.
 

krang

Member
If I choose to rent my home using investment income (which I have built up using money I would have otherwise used to purchase a home). Is it right that I should pay tax on amount used for my home?

Would you be ok to make rent a tax deductible expense?

Wouldn't the tax be on the gains made from the investment?
 

milanbaros

Member?
Wouldn't the tax be on the gains made from the investment?

Not sure what your question is exactly but to simplify, as it stands now:

Person A purchases home #98767 for £500k.
In 20 years home is worth £1m.


Person B purchase £500k of shares.
Withdraw mix of dividend income and capital to pay rent.
Rent home #98767 for £20k per annum.
In 20 years, shares worth £1m.

Person A (outside of transaction fees) pays no tax at all whereas person B pays tax on dividend income and capital gains.

Why is this fair? Why is person A getting all the benefits of asset ownership and gains (rent and house price appreciation) tax free, but the person who chose to invest his money and rent his home has to pay tax.
 
Not sure what your question is exactly but to simplify, as it stands now:

Person A purchases home #98767 for £500k.
In 20 years home is worth £1m.


Person B purchase £500k of shares.
Withdraw mix of dividend income and capital to pay rent.
Rent home #98767 for £20k per annum.
In 20 years, shares worth £1m.

Person A (outside of transaction fees) pays no tax at all whereas person B pays tax on dividend income and capital gains.

Why is this fair? Why is person A getting all the benefits of asset ownership and gains (rent and house price appreciation) tax free, but the person who chose to invest his money and rent his home has to pay tax.

I don't know if you're including this in "transaction fees", but Person A does have to pay £15,000 in Stamp Duty when purchasing the house, so it's not really tax free.
 

milanbaros

Member?
I don't know if you're including this in "transaction fees", but Person A does have to pay £15,000 in Stamp Duty when purchasing the house, so it's not really tax free.

I am including it, you have to pay stamp duty on shares as well.

Transaction taxes are a separate issue to income and capital appreciation taxes.

I would remove stamp duty on both land and share transactions.
 

Seraphym

Member
Living in North Wales, £76 a month. 25% single occupancy discount.
As with others bin collections reduced now to 1 in 3.
I am a lot lower than others so mustn't grumble.
 
rent is paid to the property owner, who pays council tax to the council, of course passing off the entire cost to the tenant as an extra fee on top of the rent

We have to pay rent to the owner, and then the Council sent us our own tax bill. Kinda sucks bc we thought it was included in the rent price, and now we're actually way over what we'd budgeted for a place. Our own fault for not double-checking, but had we known, we'd have rented a much cheaper house.
 

milanbaros

Member?
We have to pay rent to the owner, and then the Council sent us our own tax bill. Kinda sucks bc we thought it was included in the rent price, and now we're actually way over what we'd budgeted for a place. Our own fault for not double-checking, but had we known, we'd have rented a much cheaper house.

The occupier is liable for tax and not the owner. It is always assumed that council tax won't be included for this reason.
 
I am including it, you have to pay stamp duty on shares as well.

Transaction taxes are a separate issue to income and capital appreciation taxes.

I would remove stamp duty on both land and share transactions.

I didn't know that! Which I suppose gives you an idea of the 'level' I'm at in these discussions.
 
The occupier is liable for tax and not the owner. It is always assumed that council tax won't be included for this reason.

Makes sense but didn't know it at the time. We don't have something separate like that in the states, and I don't remember paying anything quite like it in Australia, either. Hydrophilic seems to think it's the other way 'round, though. Guess it's not super common knowledge?
 

Theonik

Member
The occupier is liable for tax and not the owner. It is always assumed that council tax won't be included for this reason.
Not always, if you are in a common tennancy the landlord is liable to pay the council tax by law. The definition is if you are renting a dwelling with shared communal spaces with people that are not associated with each other. But that can be quite rare. And of course the landlord will pass it on to you through the rent.

Makes sense but didn't know it at the time. We don't have something separate like that in the states, and I don't remember paying anything quite like it in Australia, either. Hydrophilic seems to think it's the other way 'round, though. Guess it's not super common knowledge?
When I was in Greece the local authority would simply slap council charges to various utility bills to the same effect. It kind of makes sense where local infrastructure is no heavily subsidised by state taxes. (someone needs to pay to collect that rubbish etc)
 
Makes sense but didn't know it at the time. We don't have something separate like that in the states, and I don't remember paying anything quite like it in Australia, either. Hydrophilic seems to think it's the other way 'round, though. Guess it's not super common knowledge?

Yeah, my post was incorrect, based on experience of staying in the UK in a shared house for 9 months

Apparently, for a shared house, it's often done differently than the standard case
 

milanbaros

Member?
Makes sense but didn't know it at the time. We don't have something separate like that in the states, and I don't remember paying anything quite like it in Australia, either. Hydrophilic seems to think it's the other way 'round, though. Guess it's not super common knowledge?

The landlord is only liable when there are separate tenancy agreements in a single property (e.g. 4 people each rent a room and have separate agreements).

I think it is fair to say that the occupier being liable for council tax is common knowledge.

I certainly wouldn't trust my landlord to pay my council tax for me. Sounds like a good way to get stung.
 

krang

Member
Not sure what your question is exactly but to simplify, as it stands now:

Person A purchases home #98767 for £500k.
In 20 years home is worth £1m.


Person B purchase £500k of shares.
Withdraw mix of dividend income and capital to pay rent.
Rent home #98767 for £20k per annum.
In 20 years, shares worth £1m.

Person A (outside of transaction fees) pays no tax at all whereas person B pays tax on dividend income and capital gains.

Why is this fair? Why is person A getting all the benefits of asset ownership and gains (rent and house price appreciation) tax free, but the person who chose to invest his money and rent his home has to pay tax.

I can't really see any reason to disagree with you, but it seems like an incredibly rare situation.

If the end goal is to have property, then you'd just buy a house to begin with, rather than invest in shares. Also, Person A is unlikely to spend those untaxed gains on anything other than more property in a more inflated market, so they effectively come out neutral.
 
When I was in Greece the local authority would simply slap council charges to various utility bills to the same effect. It kind of makes sense where local infrastructure is no heavily subsidised by state taxes. (someone needs to pay to collect that rubbish etc)

Yeah, that's one way to do it. It's just tough to keep it straight when you move so much and everyone has a different way of doing things.


Yeah, my post was incorrect, based on experience of staying in the UK in a shared house for 9 months

Apparently, for a shared house, it's often done differently than the standard case

Gotcha. They still have you make up for it in the rent price, as you said, though.


The landlord is only liable when there are separate tenancy agreements in a single property (e.g. 4 people each rent a room and have separate agreements).

I think it is fair to say that the occupier being liable for council tax is common knowledge.

I certainly wouldn't trust my landlord to pay my council tax for me. Sounds like a good way to get stung.

Maybe that was the problem, then. It's such common knowledge that no one bothered to explain it to us, even when we were relocated and had a special agent to get us settled here. :p As I mentioned to Theonik, I've relocated to four different countries over the past couple of years and everyone has a different system. The UK is the first one to have this.
 
And here's me wishing the bin man wouldn't come round every week because they leave the wheelie bin in the middle of my drive

Chuck about 3 shopping bags of rubbish in per week.

If that
 

Rodelero

Member
Ehh, I don't agree with this. It assumes that there's a link between property value and ability to pay, which isn't always the case. What about retired people? What about people who inherited their house?

We live in a society that is doing an appalling job at distributing wealth, not just from the rich to the poor, but from the old to the young. I have to be honest, but worrying about the finances of pensioners, who are currently on the Triple Lock gravy train, and those who've inherited entire homes, isn't that high on my agenda.

I have to be honest but my stance is that people in extremely valuable homes who aren't able to afford higher council tax should be forced to find more money or sell up. We cannot live in a society which forever protects the wealthy and old at the expensive of the young and poor.

You could very well argue that council tax should be scrapped and the funds found from the central income tax pot. What cannot be sustainable, or fair, is a ratio of 3:1 between the amount of council tax paid by those who live in most valuable properties, and the amount paid by those who live in the least valuable properties. Someone who owns and lives in a £1,000,000 house pays only three times the council tax of someone who rents a house that costs £250,000. It's not right.

In addition, having a big house doesn't necessarily mean you use more council services, so why should those people pay more? It doesn't sound very fair to me (that's not to say that the current system is fair either btw!).

Sarcastic response:
Having a large income doesn't necessarily mean you use more public services, so why should those people pay more? Maybe we should redesign income tax such that everyone just pays in £10,000.

Fair taxation is about taking from people dependent on their ability to give and giving to people dependent on their need. Council tax should be no different, but right now it is. It is an inherently regressive system. In its current state, council tax takes a tiny proportion of the wealth from the very rich and an enormous proportion of wealth from the very poor. It is deeply regressive, and as the tax becomes larger and larger in the coming years, this is going to become a bigger and bigger problem.
 
Community garden I volunteer at for people with mental health difficulties is closing in September. Real shame, all the mental health charities that refer clients to us are unhappy. Health funding was cut last year and council pulled out their share this year. Was going to volunteer at a code club in my local library but that will probably be shut eventually. They already put council services in the library attracting a bunch of undersirable people. Why bother?

Shame really. Council is largely focused on sports recreation wise because it brings in $$$. Soon they will start charging entry to public parks.
 
I'm honestly not the least bit surprised! I work for one of the largest councils in the UK as an engineer in the highways department and have done since 2006
to give my own experiences

I might be a little out on dates

2006-2007(before the crash)
  • My section consisted of 42 staff members
  • we had an annual revenue budget in our section of £2million (not including work funded by development or local transport funds, aka where a client paid us for work)
  • we looked after all 'minor' improvement works - aka schemes under a certain threshold
  • each staff member had approx. 4 schemes they oversaw, from design, through reports and consultation all the way to implementation on site
  • each staff member above trainee level, answering correspondence from one of the 30+ electoral wards, with trainees having none and picking up the slack

2008-2010 (The main period of the crash)
  • all staff were offered the opportunity to take early retirement, this saw (over the course of a year)4
  • with each person who left, their position was deleted from the staff structure
  • those who left were of the most senior positions, with them gone there was no room for progression for those below them
  • the responsibilities of those who left fell to those who were under them
  • the next year more redundancies were offered and a further 4 members left, they were a mixture of posts, but relatively senior posts
  • again their posts were lost from the structure
  • trainee posts on the structure became vacant as trainees had no where to move to, so left for the private sector - of the 9 trainee posts, myself and one other remained
  • their posts from the structure were removed once they left
  • our budget was reduced to £1million in the first year
  • our budget was reduced to £500,000 in the second year
  • our budget was reduced to £250,000 at some point between 2010 and 2014
  • the same level of work remained despite the reduced budget and reduced staff

2010 to current
  • at some point in 2010 further redundancies were required, but our section lost no further members
  • however some other sections were lost entirely which brought its own problems;
  • our section work load doubled as we picked up projects previously undertaken by lost teams or teams who also saw a shift in priority i.e the major projects team stopped
  • our survey team was gone, so all surveys had to be outsourced - and increase of approx. 1000% in costs
  • by this point each team member has about 9-15 schemes

Generally the above has proven to destroy moral, many experienced and qualified staff members have left to the private sector as progression has effectively been stopped by deleting any vacant posts - something exasperated by the fact nearly all staff over the age of 55 had left, meaning its atleast 10 years before some posts could become vacant allowing people to move up
I'm a fully qualified engineer, my job title still says trainee as nobody has moved up a post or posts don't exist anymore
This also stifles low level pay for front line staff, who quickly reach the top of pay bands and rely on annual pay rises in line with inflation, or rather not inline with inflation! since 2006 its been a 1% pay increase per year

My section isn't an isolated case, others have been equally decimated or destroyed! the maintenance section went from 30 odd staff to 3! THREE and they have a multimillion pound budget they are expected to use per year, its like a morgue in that section as everyone is utterly demoralised.

So I'd be nigh on certain to bet the same situation occurs in adult social care, and with an aging population they'll have skeleton staff to deal with more Pensioners!

And then the Government cut council funding (again) and put in the living wage, which in principal is awesome, in practice it means this situation where any rises in rates barely make up the wage shortfall

and then people who don't like the public service sector bash us for enjoying wage increase at their rate expense

our country is screwed, if nothing changes we will either see council tax rises ever 5 years or a complete collapse of public services! the Private sector will not be better, they make profit, we do not, that gap will be out of peoples pockets
 
We live in a society that is doing an appalling job at distributing wealth, not just from the rich to the poor, but from the old to the young. I have to be honest, but worrying about the finances of pensioners, who are currently on the Triple Lock gravy train, and those who've inherited entire homes, isn't that high on my agenda.

I have to be honest but my stance is that people in extremely valuable homes who aren't able to afford higher council tax should be forced to find more money or sell up. We cannot live in a society which forever protects the wealthy and old at the expensive of the young and poor.

You could very well argue that council tax should be scrapped and the funds found from the central income tax pot. What cannot be sustainable, or fair, is a ratio of 3:1 between the amount of council tax paid by the most valuable properties, and the amount paid by the least valuable properties.

Sarcastic response:
Having a large income doesn't necessarily mean you use more public services, so why should those people pay more? Maybe we should redesign income tax such that everyone just pays in £10,000.

Fair taxation is about taking from people dependent on their ability to give and giving to people dependent on their need. Council tax should be no different, but right now it is. It is an inherently regressive system. In its current state, council tax takes a tiny proportion of the wealth from the very rich and an enormous proportion of wealth from the very poor. It is deeply regressive, and as the tax becomes larger and larger in the coming years, this is going to become a bigger and bigger problem.

I pretty much agree with you - in my very first post in this thread I said that council tax is regressive. But I just don't think your solution is the solution.

Houses are worth what people will pay for them. I don't think an old person whose house has increased in value 10x since they bought it, but only has a state pension, is especially to blame for that situation, and I don't think "sell up and move" is a fair solution. If they've lived there 50 years they would probably like to continue living there. But fair enough if you disagree with that.
 
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