VAT-This Is Not A Bolt From The Blue
The Liberal Conservatives have this morning introduced the worst way of reducing the structural deficit created by the Labour Party, but the slickest way to ensure conformity within the EU. This Directive is from 2006.
European Country Standard VAT* Reduced VAT*
Austria 20% 10%
Bulgaria 20% 7%
Belgium 21% 6-12%
Cyprus 15% 5-8%
Czech Republic 20% 10%
Denmark 25%
Estonia 20% 9%
Finland 22% 8-17%
France 19.6% 5.5%
Germany 19% 7%
Greece 23% 5.5-11%
Hungary 25% 18% + 5%
Iceland 24.5% 14%
Ireland 21% 13.5%
Italy 20% 10%
Latvia 21% 10%
Lithuania 21% 5-9%
Luxembourg 15% 6-12%
Malta 18% 5%
Netherlands 19% 6%
Norway 25% 8-14%
Poland 22% 7%
Portugal 21% 6-13%
Romania 24% 9%
Slovakia 19% 10%
Slovenia 20% 8.5%
Spain 18% 8%
Sweden 25% 6-12%
Switzerland 7.6% 3.6%
United Kingdom 20% 5.0%
With fuel, this is going to mean that one of the most basic of business overheads is now primarily tax upon tax upon tax.
The best way to attack the structural deficit has always been to reduce Government spending drastically and ending expensive overseas military adventures. We have been in Afghanistan for ten years, that is WW1 and WW2 combined.
The underlying Fabian idea shared by the Liberal Conservatives and the Labour Party is that the State is a force for good, this means that Governments consider that their role is nothing less than crucial to our national well being. It does not occur to them that they are the problem.
It was Tax that broke the British in North America, how many of our fellow citizens are going to wake up this morning and realise that for nearly half of the year they will be working directly for the State like some neo-serf working for his Lord for free as part of his dues. Tax Freedom day falls this year on the 30th May 2011.
Higher rates of taxation means the need for a more coercive and intrusive state to collect these taxes.
This will have direct consequences for our personal Liberties.
Please read this by Charles Crawford on the irrational response by the ‘left’ to the mess they have created.
The political elite have no other response other than to Tax and Spend.
There is an alternative, it is called Libertarianism as a starter get yourself a copy of ‘The Road To Serfdom’ first published in March 1944. We are living the nightmare predicted.
January 6, 2011 at 21:52
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The increase to 20% is merely to claw back the 2 1/2% lost when VAT was
dropped to 15%, surely?
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January 5, 2011 at 15:31
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Surely those of the more libertarian position although disliking taxation
in principle should prefer Sales taxes where there is an element of choice as
to whether to pay, ie. Do I or don’t I buy the thing in the first place?
rather than Income taxes which are straightforward theft by the state.
- January 4, 2011 at 19:07
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Rising from 17.5 %to 20%, it’s a +14% rise in the VAT rate. Well above the
rate of inflation.
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January 4, 2011 at 17:39
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“Your new Rolls Twin Tub washing machine, just £39. 19s 6d (plus £13. 6s 1d
PURCHASE tax).
But, if you bought a two seater ‘Kit Car’ like a Lotus Seven with a Ford
Cosworth 1500cc engine and built it at home, it might cost you £575 – NO
purchase tax.
Purchase tax was introduced in 1940 and applied to non-essential items to
dissuade impulse buying of unecessary items. Brought in as a temporary tax
(what?) it was introduced at 33.3%. Replaced by VAT in 1973.
- January 4, 2011 at 12:37
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No, although a huge improvement over 20 I don’t want a flat rate of vat at
10% because vat is a stupid inefficient tax and should be removed completely.
Everyone in the chain has to pay it, claim it back, submit accounts and
generally piss about making accountants rich. To tax expenditure a basic sales
tax, levied just once at point of sale/service by all businesses to every non
business registered customer would be so much easier and more efficient. It
works in the USA. Or even raise income tax and free busines from all sales
taxes, they are all regressive.
Funnily enough I can remember we used to
have something very similar.
- January 4, 2011 at 11:54
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What the Lord giveth the Government taketh away
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January 4, 2011 at 11:48
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Sorry, that should have been Andrew, but I guess you knew that.
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January 4, 2011 at 11:26
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Since when does a tax add value to an item?
Bill, you should have left the 1 off that figure of 10.
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January 4, 2011 at 11:16
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I’d support a rate of 15 % VAT on EVERYTHING, and no other taxes at all.
This should be quite sufficient to run a country, and would also encourage
government to set conditions, and/or keep off our backs, which would be the
only way it could raise its revenue.
This also rewards work, and only penalises spending, by everybody.
It would also remove billions of man-hours of expenditure, and probably
millions of jobs all devoted to the manipulation of figures to calculate tax
liabilities, or avoidance/evasion.
Alan Douglas
- January 4, 2011 at 10:51
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“Fine lets have a flat rate of 10% and a smaller state.”
Seconded!
- January 4, 2011 at 10:21
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It is easier to calculate in your head when its a multiple of 10%. Most
businesses reclaim input tax anyway. The tax is paid by the end users
ultimately, who are the ones getting the public services they voted for.
Citizens of other member states shopping in the UK will be paying it too. It
is not applied to food.
On the downside, I think it may expand the black economy a little.
We have a huge hole in the public finances. We could starve the pensioners
( biggest recipients of state largesse ) I suppose, but they tend to vote in
higher numbers than the students, so they are more likely to get their way. We
could get the state to fuck out of everyone’s lives, but at least 40% of the
voters voted for Zanu, so I don’t think that’s the majority view. Or we could
realise we are up shit creek and hope that the government fixes the mess
before the dumbass public thinks they’d prefer Liebour back.
Oh, and bring our soldiers home. Now.
- January 4, 2011 at 10:47
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It is easier to calculate in your head when its a multiple of 10%
Fine lets have a flat rate of 10% and a smaller state.
Barely 35% voted for Labour, but under our electoral system they got a
Parliamentary system they got a majority for thirteen years.
Government Money = Free Money in the public’s mind.
When Governments start debasing the currency by printing more money
everybody becomes a millionaire even though they are pay £75 for a loaf of
bread. I was taught in Economics generally people are happiest in
inflationary times as long as the inflation rate is no more than 5-10%, so I
can see somebody asking for a loaf of bread saying ‘have you got change for
a £2000 note’ as not being a flight of fancy.
- January 4, 2011 at 11:08
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I tend to agree with you. I am with the get the state out of our lives
side. But since the voters could not even elect a Conservative government,
I suspect we are a minority. So we can shout from the barricades all we
like, but we are where we are, and its not going to become a free market
utopia here any sooner just because a minority of us think it ought to
be.
So short of a revolution this weekend, we could just swallow the
medicine and keep on praying.
- January
4, 2011 at 09:55
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And I forgot to mention – under EU law we are not allowed to have a basic
VAT rate below 15% and that once the scope of VAT has been extended to a
product group we are not allowed to remove it again. This was the problem with
domestic fuel : once it had been brought with the scope of VAT, that decision
was irreversible, so they compromised by introducing the lower 5% rate to get
round it.
So much for governing our own country…
- January
4, 2011 at 09:50
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I did a similar comparison the day before the budget – see http://dioclese.blogspot.com/2010/06/vat-what-next.html
What is interesting is that we still have one of the lowest rates in Europe
at 20%.
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January 4, 2011 at 09:43
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Interesting!
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