2021 Budget Predictions

[Fittster]

Al Gorithum said:

Interesting about the Freeports (which I understand we had to relinquish to keep the EU happy).

I wonder how that'll work out?

There were free port areas in Liverpool, Southampton, the Port of Tilbury, the Port of Sheerness and at Prestwick Airport until 2012. The fact that no one remembers that suggests they aren't a big deal.

[Al Gorithum]

Fittster said:

Al Gorithum said:

Interesting about the Freeports (which I understand we had to relinquish to keep the EU happy).

I wonder how that'll work out?

There were free port areas in Liverpool, Southampton, the Port of Tilbury, the Port of Sheerness and at Prestwick Airport until 2012. The fact that no one remembers that suggests they aren't a big deal.

Good point! Seems to have been a big deal to the EU though - unfair competition IIRC.

[Eric Mc]

A number of other EU countries had freeports too.

Shannon Airport in Ireland used to be a Freeport. I presume that got knocked on the head as well.

Having said that, the Irish have some sort of Zero Corporation Tax zone in Dublin Port these days - and they are still in the EU.

[PeteinSQ]

poordecisions said:

That's it. We have bought houses (through a holding company) for cashflow and ROI, rather than capital gain which would be a bonus. If you taxed us for selling the houses, we just wouldn't bother selling them, ever.

In the same stroke, we work in construction consultancy (incl development), so in some ways would then contribute for the demand to our other services by not selling.

This will be true in some cases - but there are a lot of people who buy rental properties with interest only btl mortgages with a view to selling the property after a set period of time to clear the mortgage and keep the profit. Or people that buy a property purely with a view to flipping it a few months later.

This sort of transaction will be less attractive and these people are buying for a large ROI not a stream of income.

[markcoznottz]

poordecisions said:

richardxjr said:

Really? 'we want generation renters to be generation home owners'

That one bit makes no sense to me. The stamp duty freeze and 95% mortgages will likely push prices up higher, and any 10% drop in value will cause a lot of people to drop into negative equity, reposessions, recession etc.

The BTL landlords (myself included) will have houses increase in value and not rise in CGT if we sell them.

Pushing up prices doesn't seem conducive to less rent more ownership..

Using this route, later on you BTL landlords at a later date which causes a mass sell off and house prices drop, plunging the 95% buyers into negative equity.

Am I missing something? I don't really see why people hate landlords quite so much, it's all a market, like Rolex's or GT3RS's.

Edited by poordecisions on Wednesday 3rd March 14:38

Btl was a result of brown trashing the best private pension scheme in Europe. Maybe.

[Gecko1978]

Scootersp said:

youngsyr said:

Scootersp said:

Also I'd argue no company can really gripe too much if they've received furlough funds.........at least until the extra tax they end up paying exceeds the amount received?

That's a bit one-sided, IMO.

Companies only received furlough grants if they put employees on furlough, i.e. they weren't working for them, more often than not because the government made it illegal to operate.

The companies could have fired their employees and not taken any furlough grants. Those grants weren't purely for the companies' benefit, or even mostly.

Fire or made redundant with associated costs? Losing quality staff they know they'd want back, it has business benefits........a huge one being the (hopefully) lack of general economic devastation and negative spiral in the economy effecting all?

I have a feeling it's all lip service any how and like america stimulus in some form will continue, we never operate at an annual surplus anyway so what consequences a bigger deficit........

Edited by Scootersp on Wednesday 3rd March 14:46

Given the cap on furlough was 35k then most of the workers (not all) affected will have been in lower skilled rolls like retail for example. So while day 1 you can't replace like for like you could probably find a nearly as good replacement. But the government don't want millions more unemployed so furlough took care of that. They said 11m was predicted but only circa 4 are unemployed but 5m on furlough so it amounts to the same without furlough no job (no fault of the employee as such).

The economy can bounce back but thats not the same as the same jobs existing.

Example, you now do 1 day a week from home where as before you did 0. So you are travelling 20% less buying 20% less starbucks and pret sandwiches. Suddenly there is not as much need for thoes jobs. Same you are wearing 4 shirts not 5 20% fall in demand.

Things will never be 2019 again and they were always going to change. 2022 might see a rise in some areas but i would bet certain types of retail are done for. Also cinema (i like going). But if i can rent a new film at home with family and buy popcorn etc all for the cost of 1 ticket not 4 then its hard to see that recovering. In the 90s we all had 32 inch at best mono tvs. Now we have 65 inch 4k monsters with sound bars etc.

[KTF]

Gecko1978 said:

Given the cap on furlough was 35k then most of the workers (not all) affected will have been in lower skilled rolls like retail for example.

My employer put the majority of its employees on furlough when the scheme was available. They claimed up to the cap from the government then topped everyones salaries up from their own funds so there was no reduction on take home pay for those on furlough - the reasoning being that if there was no reduction in pay then you would have no objection to being put on furlough.

Whilst the scheme was aimed at the lower skilled roles, I cant believe my employer was the only company that used it as a means of reducing cash leaving the business when there was no work to do as the government was effectively paying some of the wages.

.

[turbobloke]

Fittster said:

Venisonpie said:

Digga said:

UK needs to improve productivity. The key route is through investment; one man with a shovel can only do so much, give him a mini digger he can do a whole lot more.

Yup. Encourage economic growth and shrink the debt rather than strangle GDP potential.

OBR forecast of 4% loss in productivity as a result of non-tariff barriers erected between UK and EU trade by TCA particularly in services

So more damage to the UK economy because of Brexit.

It's a forecast not a forgone conclusion, sorry to disappoint.

Try this for size - they got it wrong after the referendum and may well do just as good a job this time.

OBR Explains Errors in Forecasting Impact of Brexit
https://www.ft.com/content/d140f26e-f7b9-11e8-af46...
Essence of the article for those with no FT access - OBR admits that UK public finances deterioration it forecast after the EU referendum result has not materialised.

The OBR really should apologise to remainers for getting their hopes up.

[turbobloke]

On topic, having just read a summary of the budget, Sunak steered a reasonable course overall.

[snuffy]

snuffy said:

There's a lot of newspapers predicting massive tax raids for all kinds; pensions, houses, assets, wealth, corporation tax, re-introduction of the windows tax even !

My bet would be it's yet another campaign of disinformation and nothing of the sort will happen; it's standard procedure. So everyone is now prepared for HMG to steal even more of their money, and when they don't do that, everyone will then thank their lucky stars and say what a fantastic Government we have and how benevolent Boris and Rishi are !

The debt will be parked for years. And what we are seeing now is a policy of disinformation.

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

[turbobloke]

snuffy said:

snuffy said:

There's a lot of newspapers predicting massive tax raids for all kinds; pensions, houses, assets, wealth, corporation tax, re-introduction of the windows tax even !

My bet would be it's yet another campaign of disinformation and nothing of the sort will happen; it's standard procedure. So everyone is now prepared for HMG to steal even more of their money, and when they don't do that, everyone will then thank their lucky stars and say what a fantastic Government we have and how benevolent Boris and Rishi are !

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

Good call.

Isn't it traditional to pass on corptax to consumers where possible?

It's not the sky falling in for sure and still lower than Labour promised us with no covid pandemic around.

[TriumphStag3.0V8]

turbobloke said:

Fittster said:

Venisonpie said:

Digga said:

UK needs to improve productivity. The key route is through investment; one man with a shovel can only do so much, give him a mini digger he can do a whole lot more.

Yup. Encourage economic growth and shrink the debt rather than strangle GDP potential.

OBR forecast of 4% loss in productivity as a result of non-tariff barriers erected between UK and EU trade by TCA particularly in services

So more damage to the UK economy because of Brexit.

It's a forecast not a forgone conclusion, sorry to disappoint.

Try this for size - they got it wrong after the referendum and may well do just as good a job this time.

OBR Explains Errors in Forecasting Impact of Brexit
https://www.ft.com/content/d140f26e-f7b9-11e8-af46...
Essence of the article for those with no FT access - OBR admits that UK public finances deterioration it forecast after the EU referendum result has not materialised.

The OBR really should apologise to remainers for getting their hopes up.

Gives them all something to get frothy about, so they are happy. Doesn't have to be true, or correct, just as long as it is Grrrrrr Brexit. They will move on to the next incorrect prediction or sob story as soon as this one is proven incorrect.

[turbobloke]

TriumphStag3.0V8 said:

turbobloke said:

Fittster said:

Venisonpie said:

Digga said:

UK needs to improve productivity. The key route is through investment; one man with a shovel can only do so much, give him a mini digger he can do a whole lot more.

Yup. Encourage economic growth and shrink the debt rather than strangle GDP potential.

OBR forecast of 4% loss in productivity as a result of non-tariff barriers erected between UK and EU trade by TCA particularly in services

So more damage to the UK economy because of Brexit.

It's a forecast not a forgone conclusion, sorry to disappoint.

Try this for size - they got it wrong after the referendum and may well do just as good a job this time.

OBR Explains Errors in Forecasting Impact of Brexit
https://www.ft.com/content/d140f26e-f7b9-11e8-af46...
Essence of the article for those with no FT access - OBR admits that UK public finances deterioration it forecast after the EU referendum result has not materialised.

The OBR really should apologise to remainers for getting their hopes up.

Gives them all something to get frothy about, so they are happy. Doesn't have to be true, or correct, just as long as it is Grrrrrr Brexit. They will move on to the next incorrect prediction or sob story as soon as this one is proven incorrect.

If any pessimism gap emerges we can always be reminded about the yachties "won't somebody think of the yachties".

[Murph7355]

snuffy said:

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

Isn't the Corp Tax rise also tapered between 50k profit to 250k profit, so the 25% rate kicks in over 250k (profit)?

Cue Amazon et al making even less profit each year

[Fundoreen]

Freeports , they keep pushing them but never explain it to the public and the public are stupid so dont care.
One idea is buy lots of meds and store the containers at the freeport. You know whats coming due to data input from everywhere and AI doing the brainwork.
Sell it all for vast profits when it becomes scarce due to latest pandemic. UK doesnt benefit at all apart from maybe tax on the storage costs.
Individuals get really rich.
Could be some other reason for freeports im not aware of.

Actually should have just said 'like del boys lockup'

[turbobloke]

Murph7355 said:

snuffy said:

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

Isn't the Corp Tax rise also tapered between 50k profit to 250k profit, so the 25% rate kicks in over 250k (profit)?

Cue Amazon et al making even less profit each year

Bezos Skintos Notafkingchanceos.

[snuffy]

Murph7355 said:

snuffy said:

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

Isn't the Corp Tax rise also tapered between 50k profit to 250k profit, so the 25% rate kicks in over 250k (profit)?

Cue Amazon et al making even less profit each year

Indeed that is how it works. So for the majority of businesses, it will not be the full 6% (i.e. 19% to 25%) and then only from 2023.

As I say, the predictions on here, and in the media, failed to happen.

[Murph7355]

snuffy said:

Murph7355 said:

snuffy said:

There we go, as I said, all those predicted massive tax raids did not happen (with the exception of corporation tax).

Isn't the Corp Tax rise also tapered between 50k profit to 250k profit, so the 25% rate kicks in over 250k (profit)?

Cue Amazon et al making even less profit each year

Indeed that is how it works. So for the majority of businesses, it will not be the full 6% (i.e. 19% to 25%) and then only from 2023.

As I say, the predictions on here, and in the media, failed to happen.

Accountants will be making hay over the next 12mths I suspect

[Eric Mc]

Murph7355 said:

Isn't the Corp Tax rise also tapered between 50k profit to 250k profit, so the 25% rate kicks in over 250k (profit)?

Cue Amazon et al making even less profit each year

Explained by me above.

Corporation Tax worked like this for many years. It was "simplified" to a single rate a number of years ago.

It's just been made complicated again.

[Eric Mc]

Murph7355 said:

Accountants will be making hay over the next 12mths I suspect

No - just doing our normal jobs.