Cabinet cutters are out of touch with daily realities

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Wednesday, July 07, 2010
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This is Lincolnshire

YOUR headline (June 29) asks: Are we in it together with the millionaire politicians? I have to answer: Absolutely not.

Your correspondents are certainly correct; the introduction and increase of a VAT regime from 17.5 per cent to 20 per cent from next January can only affect families with children, the elderly, the poor and the disabled.

To the millionaires in Parliament, and the multi-millionaires in the private sector, this will be a drop in the ocean.

Why did the Chancellor not adopt a moratorium on the "bonus culture" for the next five years? That would certainly have made it a fairer Budget.

It is not enough to just penalise the public sector; the private sector must feel the pain as well.

I had understood, however, that there was to be a freeze on the council tax next year, so I was surprised that the City of Lincoln Council was thinking in terms of raising its council tax to offset the VAT increase.

Perhaps the councillors might like to take a 25 per cent decrease in their allowances instead next year?

With regard to the schools that wish to become academies, as announced by Michael Gove, the Secretary of State for Education – surely this is just another ploy by a politician who seems to realise that the country is in a financial mess.

He must also realise now is not the best time to introduce new financial schemes which can only affect the current educational provision with its own problems.

The curriculum should be formed by the Exam Board so that schools can teach within their parameters.

Finally, it seems obtuse that the MP for Lincoln, Karl McCartney (June 28), appears to be more concerned with how is name is spelt.

Surely he has more important matters to concern himself with regarding Lincoln in particular and the rural areas outside the city in general.

A. M. Waddington Viking Way, Metheringham.

T. O'BOYLE'S challenge (July 1) to Lincoln MP Karl McCartney's absurd claim that the budget is "good for Lincoln" is supported by a wealth of independent evidence.

The Conservative's new quango, the Office for Budget Responsibility, has concluded that the Budget will mean lower growth and an extra 100,000 unemployed.

The Engineering Employers' Federation has expressed grave concern at the fiscal measures that will reduce incentives to develop new products.

The Institute for Fiscal Studies has concluded that George Osborne's additions to Labour's planned cuts overwhelmingly hurt poor people.

The stock market has plunged below 5,000, which is the "free market's" verdict.

Cancellation of the Young Person's Job Guarantee will damage the life prospects of young people throughout the country.

Policing and other front line services are being sacrificed to dogma, not economic need.

Even the G20 rallied behind Labour's plans to cut their deficits by half by 2015.

David Cameron stands alone in the world in believing that removing the fiscal stimulus in total is good for Britain.

Eric Goodyer High Street, Colsterworth.

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15 Comments

  • Profile image for This is Lincolnshire

    by John, Lincoln

    Friday, July 09 2010, 11:12AM

    “I say undeniable, they say can be, either you want certainty or not. Fair point on me missing your point, I thought you agreed the poor would have a bigger percentage and we were quibling over relevance for them. The maths on who is effected more is indisputable when looking at items that is essential to purchase. However as you say, it is old ground and let's go our seperate ways.
    Hats off to you for it not getting personal.”

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    by Missouri Marten, Lincoln

    Thursday, July 08 2010, 11:20AM

    “John, it doesn't normally. Only when you start proffering opinions as indisputable facts. For the record I absolutely have disagreed that it effects the poor harder - you clearly either haven't read my posts properly or you've chosen to ignore their content.

    I view the use of the words "often" and "can be" in the JRF's assessment of the budget as sounding like vague unsubstantiated opinion.

    We'll agree to disagree.”

  • Profile image for This is Lincolnshire

    by John, Lincoln

    Thursday, July 08 2010, 9:23AM

    “What do you want me to do, lay out a full tax plan with selected brackets etc? This would prove what about VAT?
    You have not disagreed with me that effects poor harder, we differ over whether it effects them significantly. Fortunately you will never be in a position to find out.
    Here is a quote from JRF "Raising VAT to 20% will also hit people in poverty hard. The proportion of income spent by the less well-off on VAT is often higher than that of the rich and the effect on standards of living can be much greater for those living on £65 per week than for someone who has £500 each week." Source is JRF.org.uk. Apologies for not putting in any evidence before hand but didn't really think a letters page comment facility really required citations”

  • Profile image for This is Lincolnshire

    by George, Boultham

    Wednesday, July 07 2010, 6:44PM

    “Was it just me that noticed that A. M. Waddington lives in Metheringham? you dont pay tax to the City of Lincoln Council and Karl is not your MP. Maybe you could focus your attention to the council that concerns you and your own MP?”

  • Profile image for This is Lincolnshire

    by Missouri Marten, Lincoln

    Wednesday, July 07 2010, 6:34PM

    “"I'd suggest a tax that focuses on those more able to pay it and related to their ability to pay it."

    Sorry, but a more generic statement you could not have made. I appreciate you're not an economist or expert in the area of tax, but I had hoped for a little more than this.

    "the tax undeniably hits poor harder as a proportion of their income does."

    It's interesting the way you state this as an incontrovertible fact yet haven't presented any evidence to back it up. If it's undeniable, I would again expect more from you. The Economic and Labour Market Review, Volume 4-3, March 2010) shows that the bottom 20% of households see 4% of their spending go on VAT, compared to 8% for the wealthiest 20% and 7% on average in the UK. Put another way, the worst off pay less VAT.”

  • Profile image for This is Lincolnshire

    by John, London

    Wednesday, July 07 2010, 4:41PM

    “No, repeating something does not make it true, the fact that the tax undeniably hits poor harder as a proportion of their income does.
    I'd suggest a tax that focuses on those more able to pay it and related to their ability to pay it.
    I am not saying that I am against the tory's plan for this country, simply that is it unsurprising that they work in the interests of their voters. It will be in ten years time when we can judge whether the reds spending out or a recession or the blues saving the country's defecit has worked best.
    As you say, I am just repeating myself over the VAT issue so will leave it there. I believe it is a regressive tax, not by the strict definition, but one affecting those least able to pay.”

  • Profile image for This is Lincolnshire

    by Missouri Marten, Lincoln

    Wednesday, July 07 2010, 3:45PM

    “Repeatedly saying that VAT is a tax that punishes the poor more than the rich doesn't make it so John. What tax do you consider to be "fair"? What taxes would you have hiked up to get us out of this God awful mess that those who voted RED are in large part responsible for?”

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    by John, London

    Wednesday, July 07 2010, 3:02PM

    “It was a concern enough for charities dealing with those in poverty to raise it as an issue. There are a number of people who don't earn £100 a week. I think you underestimate quite how dire it can be where every pound counts, that £1.78 can be crucial. That aside it is still a tax the punishes the poorer more than the rich, but then I guess it should not come as a surprise to anyone who voted blue.
    The fact that Income tax is avoided by the extremely wealthy suggests it should be tightened up, it does not suggest that VAT is fair.”

  • Profile image for This is Lincolnshire

    by Will, The Shire

    Wednesday, July 07 2010, 2:49PM

    “"Cancellation of the Young Person's Job Guarantee will damage the life prospects of young people throughout the country."

    Utter testicles.

    I'm a "young person" myself and have not been out of work since I left school after my GCSEs. Why? Because I actually put the effort in to look for a job and apply for it. A lot of people my age are just too lazy to do that, or believe that a job should come to them instead of living in the real world.”

  • Profile image for This is Lincolnshire

    by Missouri Marten, Lincoln

    Wednesday, July 07 2010, 2:41PM

    “Sorry, but I just don't buy it John (if you'll excuse the pun). What would you suggest instead, an increase in income tax? Unavoidable by anyone who is in work but considered to be "poor". Easily avoided by the wealthy, who can afford the right financial advice/accountants or who don't even pay income tax because they don't need to work.

    If someone who is "poor" spends £100 gross per week on "essentials", which are all VAT rateable, then they will only have paid £1.78 more of that £100 in VAT at 20% as opposed to 17.5%.

    As I said before, I'm sure very few people felt considerably better off when VAT dropped by 2.5% and I doubt many will feel considerably worse off when it goes up. We really aren't talking about huge sums of money here for the average Joe.”

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