Wednesday's Budget Announcement

[Scottish Business Owner]

Alistair Darling will announce the budget this week (Wednesday) in parliament.

Given the amount of money the government has pumped into the economy over the past months it's very likely we're all gonna be hit in the pocket in some way as a way of starting to pay off these massive debts.

Are we expecting anything positive from the budget at all? Is there anything you would like to see happen ?

 

[RedEvo]

It's expected there will be no major new fiscal measures but a series of targeted ones (today's Observer).

£2bn to help the under 25's find work. Probably a good thing.
£2k car scrapping scheme. Probably a bad thing.
£50bn mortgage underwriting scheme. Definitely a bad thing as it will encourage people to buy houses in a falling market risking negative equity and much soul searching.

Maybe he will announce something to reward people who were prudent through the debt fuelled boom and perhaps Juliette Binoche will ring me and ask me out for dinner.......

d

 

[Boxby]

Mu hubby is seeing definite movement in the housing market in the South of England, it seems to be the houses that the more sensible first time buyers are buying, those who've saved deposits and feel that the lower prices are starting to bottom out.

Also, he's done a lot of clearances recently for houses which are just being bought as a place to put money until the interest rates go back up again, but a different, more savvy, type of investor from the greedy buy-to-lets from before. It's the older safer 3 bed houses that are being bought like this, not the spangly new apartments.

Here in Ayrshire, definite stirings again. Maybe it's just the sunshine.....

Someone's suggesteed raising VAT threshold to £100k. A lovely idea but probably as likely as a sunny August.

 

[Scottish Business Owner]

Someone's suggesteed raising VAT threshold to £100k. A lovely idea but probably as likely as a sunny August.

I agree Sandra. Very unlikely.

I've also read that many private businesses are calling for a freeze in the minimum wage. I have to say as someone who does payroll and comparing it to say 5-10 years people seem to be a lot better of in term of take home pay compared to then. Is a freeze a good idea?

 

[Scottish Business Owner]

It seems VAT may also be on the agenda if the below article is to believed.

Darling expected to push rate up well beyond 17.5% in bid to tame country's spiralling deficit - Scotsman.com Business

As much as 22% within three years..... Incredible!

 

[Boxby]

Lets all move to Ireland!!
No tax for the first 3 years for any company that starts trading in 2009.

 

[Boxby]

But i suppose it's all pie in the sky because there will be an election, and whoever comes in will reverse it...........

Did you see this bit;
"Bill Dodwell, head of tax policy at Deloitte, said a 1% increase on the 17.5% rate would raise over £5bn to replenish the Treasury coffers but would cost taxpayers on an average salary of £25,000 a year just £1 extra a week, making it an attractive option for the Chancellor."

How the heck does that work? I guess that the average taxpayer on an average salary doesn't buy any fuel??

 

[RedEvo]

If you buy £25 worth of fuel plus VAT, it's £29.38 inc VAT @ 17.5%. If they raise the VAT rate to 18.5% you will pay an extra 25p on the same amount of fuel. Adding in other vatable items in our daily lives the 'extra £1 a week' seems about right.

d

 

[Boxby]

I think our household just spends too much on fuel .

 

[Scottish Business Owner]

Reading today as well that they predict efficiency saving of £10 Billion on the spending of £500 Billion. Is it just me or does that seem ridiculously low????

 

[bsfweb]

£2k car scrappage - is a good thing (despite having a website in the used car parts marketplace CarSpareFinder).
Why - think how many jobs (and votes) in the UK are linked to the motor trade?

 

[bsfweb]

VAT is a threat...it needs to find a good level.
The reason I favour VAT is that it deals with tax dodgers and black economy (CRIME). Spending ill gotten gains attracts VAT....and encourages people to work for a living instead of living off benefits (I appreciate this is politically sensisitive, and I'm not suggesting that a single mum with 2 young kids is the burden...rather all free and able, yet no so willing). I am not trying to sound fascist, this is fiscal policy and macro-economics.

I'd appreciate others' views....