Budget Oct 24 Thread

My CC will probably be the only new car I ever 'own' then! In retrospect perhaps shouldn't have chosen a MG.

I can't seem to embed Tweets...

Anyway, Truss has given her expert opinion on today's budget. Which is just epic to type let alone watch!! 😀

https://twitter.com/Tush27J/status/1851586005901402304

I think the hike in CGT only really impacts people who are gaming the “earn minimum wage and take the rest as profits” approach, which I don’t have much problem with. The vast majority of other folks can afford to wrapper any investments they have (a couple get a total of £160k per year in tax free investments, combining pension and ISA), 

I think plenty of normal folks will be caught by things like share schemes they get as a benefit of work. Certainly I'm no millionaire but it'll cost me a couple of hundred quid at least. Don't really mind as long as they use it to improve stuff in society, but to say this budget won't impact working class folks is a bit disingenuous

Anyway, Truss has given her expert opinion on today’s budget. Which is just epic to type let alone watch!!

Its even funnier that she still thinks the tellybox people get her on for everyone to benefit from her words of wisdom, when the truth is she’s a modern day freak show. Let’s all point and laugh at the delusional fruitcake who still thinks she’s relevant and not a total laughing stock

The groans from the Tory spin doctors whenever she pops up again must be audible from miles away

The groans from the Tory spin doctors whenever she pops up again must be audible from miles away

The Libdems called her in from the cold but her work is not yet done, her mission not yet fulfilled.

Whilst there is still a Tory party to destroy she will never rest, never relent. 

We are forever in her debt. Literally. 😉

Can someone explain the car road tax thing again to me please, really slowly !

Yesterday, if I bought a car assume petrol or hybrid for this discussion, not pure EV) , say a £39k Subaru Forester mild hybrid (135g/km) ... I would pay £18p or £190 a year road tax. Same if I got the £39.5k version of the Outback (petrol only, 191g/km).

Now if that same car was valued (list price / DVLA defined price) of £say £41k (ie over £40k list price) then as I understood it, the road tax would be £590 for the first 5 years, then £190 thereafter (ignoring any subsequent increases).  Because there was basically as £2k tax on anything over £40k, grabbed by the Gov in 5 equal chunks of £400 a year (giving a £400 luxury car tax + £190 normal road tax = £590)

What would I pay since the budget (from April 2025).

There were the words 'first year' in some of the quoted stuff earlier - how about years 2 through to 15 ?

.

Gareth Davies, the Tory shadow treasury spokesman, is getting absolutely shredded again on channel 4 news…

Laura Trott similarly got a kicking on Politics Live. Should have stuck to cycling.

Can someone explain the car road tax thing again to me please, really slowly !

@robertajobb

The first year 'tax' is doubling, but that's included in the on the road price of the car, so effectively car prices will go up and the difference is going to the treasury.

Thereafter, the additional £410 on top of the VED for cars over £40,000 list price (regardless of the price you pay for it) is paid from year two to six and this hasn't changed today (was half expected to).

Tax on tobacco to increase by 2% above inflation, and 10% above inflation for hand-rolling tobacco

Who amongst you lot on STW reported to the Chancellor of the Exchequer, The Rt Hon Rachel Reeves MP. that I smoke hand-rolling tobacco and should have a tax hike of above 10% for hand-rolling tobacco?
The current 50 grams of hand-rolling tobacco is £31.50 and I can have a few puffs if I roll it thin to last me a while.
Does the Chancellor of Exchequer now just want me to smoke the hand-rolling tobacco paper only?

Although they’ve got till April 2027 to either die or put another plan in place.

Working on it.  Anyone got a contact for C&H?

think plenty of normal folks will be caught by things like share schemes they get as a benefit of work. Certainly I’m no millionaire but it’ll cost me a couple of hundred quid at least

Can I check if you've looked into transferring them into an ISA to minimise tax?

The thing I find annoying is that no one points out a basic point, putting money into the NHS is the same as spending it on a large infrastructure project in terms of benefit. The money spent on wages especially at the ‘normal’ end of the scale- admin, orderlies, nurses and resident docs, will be pumped straight back into the economy. Buildings will see money recirculating as well. Some high level equipment, scanners MRI and so on are all available in the UK, not all obviously.
On top of this we have a healthier workforce, happier people, and cheaper long term health costs if waiting time are reduced.
Surely spending money in the NHS is always a benefit as long as it’s being spent well, not some black hole that sucks money in and it disappears.

chewkw

I smoke hand-rolling tobacco

Chew, zero malice intended here but is that really the heaviest financial burden your "smoking" entails?

Come on you tyke, out with it, out with it!

You are amongst friends... generally bloody confused friends after we read your posts, but friends none the less!

You forget the Covid £ that the tories funnelled to their mates who promptly off shored it.

Increasing the bus fare cap to £3 saves £350m (compared to keeping it at £2).

Keeping fuel duty as is will cost £20bn.

Could be bullshit but I'm seeing people on Twitter saying the cost of maintaining the fuel duty freeze and the annual bus ticket revenue for the whole of England are practically identical at about £3bn. IOW you could have made all buses free simply by reinstating the fuel duty escalator...

Does the Chancellor of Exchequer now just want me to smoke the hand-rolling tobacco paper only?

Ideally, not even that.

Increasing the bus fare cap to £3 saves £350m (compared to keeping it at £2).

Keeping fuel duty as is will cost £20bn.

That decision was pure politics, it doesn't make financial sense, it's objectively not fair and it doesn't help the environment. 

But...

They would have been annihilated in the press, online and in almost every living room tonight. That's ok I suppose but it's the sort of detail that voters will remember in 5 years time at the next GE and likely punish them for.

As a political move, to ensure they stay in power long enough to actually make real positive changes in the future, it was the right choice in that context. Sadly.

Looks like inheriting the family farm just got turned on its head.

Thanks to the wealthy and their aiders hijacking the sector to avoid inheritance tax.

I'm sure the big farms can take it, and what a privilege to inherit that anyway even after tax, but it looks sketchy for small family farms.

It was a giant loophole though. People gaining their wealth outside farming, and then in their retirement years buying farms, playing at running them (or letting others pay them for the privilege of running them), ready to pass on the land to their adult and already wealthy kids as a nice big tax free inheritance. 

Does the Chancellor of Exchequer now just want me to smoke the hand-rolling tobacco paper only?

If it’s any consolation they’re slapping a tax on vape liquid….

And so it begins…

I expect it’ll be 20 quid a bottle in a few years, with £18.50 of that being tax

It was a giant loophole though

Indeed. But in closing it, and doing so in this manner, taking out the farms even just big enough to sustain a family.

Laura Trott similarly got a kicking on Politics Live

To be generous to her… she’s not the sharpest tool in the box.

Its a telling sign of where the Tories presently are that her and Gareth Davies are both ministers in treasury roles - so nothing important then - who you wouldn’t leave unsupervised with a pair of scissors, never mind the counties economy

It's a sad sign of the times when we have to consider if MP's can be trusted with a pair of scissors.

But this is where we are.

Basically a Tory budget through and through, except with no green measures. FFS, keeping the fuel duty discount is appalling when you've increased the price of bus travel by 50%.

I dunno Flaperon, the Mail aren't happy with this Tory budget, mind you, when is the Mail happy?

Anyway, if they have gone after the strivers that's a step too far. I for one know many a, erm, striver.

However, the good news is, "it's the most left wing budget for decades" which is likely to surprise many posters on here including me!

"Pushed taxes to the highest level ever" is a funny thing to be able to say. It depends massively on how you measure it of course and the simple statement ignores who the burden falls on, but it's not an unreasonable statement overall. Except that it was also true when by the exact same metric George Osborne pushed taxes to the highest level ever in 2012, then it was raised to be the highest level again in 2019, and then in 2020 and 2022, and the last tory budget only avoided it by kicking a bunch of increases down the road- but would have led to the highest level ever in 2026.

But of course when Labour do it it's different. I don't agree with much about this budget but it's no surprise that some of the coverage is completely dishonest.

None of this will really work. Nothing that substantial to shift the big economic picture. It mostly just appears a bit better than usual because everything is at such a low bar.

The minimum wage uptick would be good if the government put some money into the correct areas of the economy to allow this to happen.  But relying on some post-covid crippled business to generate the extra is not going to happen save the biggest employers.

Growth, their number one aim is looking ropey over the next few years. There's simply not enough going into the economy via government spending to generate growth. (Even the OBR agree which is not good for Labour.)

The idea that the economy will run a surplus by 2027 is the stuff of preposterous nightmares. That is the very definition of a contracted economy. These idiots just don't seem to get it. They want growth and a government surplus from the current state of affairs in three years? Why would you want to take money out of the economy if your aim is growth and we're at such a low base?

They have it back to front. We absolutely need to run a large deficit for a while to stop things contracting and make substantial change to the country. Aiming for a surplus is like driving down the the right in the UK. A government deficit is a non-government surplus. Money for stuff.

Budget is a massive fail by all their own metrics.  Very little makes any sense if you even have a tiny understanding of economics.

It will all become clear in the next two years but probably the budget next year will have to be way more serious in its attempt to fix things. Hopefully Reeves might be gone if some poor metrics come in.

Keeping the seat warm for the Tories and wasting an opportunity.

dunno Flaperon, the Mail aren’t happy with this Tory budget, mind you, when is the Mail happy?

Anyway, if they have gone after the strivers that’s a step too far. I for one know many a, erm, striver.

However, the good news is, “it’s the most left wing budget for decades” which is likely to surprise many posters on here including me

The right-wing press are going to call the Labour budget Communist and lefty shite no matter what they do. That's always been obvious to me. Remember Communism is everything 'we don't like.'

None of that reflects reality on either side.

It's not a progressive budget at all.   By the very definition of aiming for a surplus by 2027 means it's regressive. Because you are aiming to reduce what the government contributes to the economy.

The only hope is there's no way they can possibly stick to that without crippling outcomes.

Unsurprisingly the people complaining about the budget in my shop yesterday afternoon were two (comparatively) wealthy pensioners, and three multi millionaires. All asked how it'll affect me and the shop, and said how awful it was. When challenged why it was terrible, none could explain exactly why. Only one came out with her daughter is buying a house and will have a 2% rise on stamp duty, turned out it wasn't a 2nd home so wasn't to be affected and she had already paid the duty last week anyway, just in case...

Pretty sure the figure I heard was 22bn for day-to-day spending and 3bn for capital spending. Where has 1.2bn come from?

Apologies I was quoting what the BBC were saying’live’ just after the budget finished. Their website later updated to £22bn

Thats a significant sum of money. However, there is no coherent plan. They want to continue Tory plans of creating diagnostic hubs (good) , and some of the backlog maintenance, but it won’t address significant backlogs ie places that need new hospitals, or social care/NHS interaction. In fact I imagine waiting list will grow. I imagine the tax on private schools will make a significant number of consultants think f you and do less work than before. Nothing in there for the GP contract too.

It will also be interesting to see how much the increase NI  charges cost the NHS. Random internet search had it at £3.3bn based on a % increase, let alone the threshold change, so maybe double that? Thats a fair chunk of your £22bn gone. How will GPs fund their increases when they were already at the point of making a loss on their contract?

It all appears to have gone very quiet on the impact of farmers. I live in Shropshire where many farms contrary to stereotypes and sweeping statements on here, many farms are family owned and run. Someone I work with , their daughter has just finished uni and had returned home to takeover the family farm. It will be interesting to see what the implication is.

I imagine the tax on private schools will make a significant number of consultants think f you and do less work than before

With all due respect, I think that’s a bit of an intellectual leap. Lots of my colleagues don’t have kids, lots of them don’t have kids at private school, lots of those who do, do decent amounts of PP, and those who have kids at private school and don’t do PP are unlikely to be doing less work in the face of a 20% school fee uplift.

Two small pieces of good news (IMO) - Eden Project North has been funded, and the changes on company car benefit on dual cab pickups (which I know were a bit controversial on here…) are going ahead.

I heard there was an announcement about the Leeds tram but can’t find anything?

The 7 year gifting exemption still applies to farms doesn’t it?

If an average 2 million farm can’t handle. 10% tax on a generational basis (1 mill exempt and the next mill at 20%) then maybe it needs better management.

Surely spending money in the NHS is always a benefit as long as it’s being spent well, not some black hole that sucks money in and it disappears.

With 1.5mn employees (1.35mn FTE) the changes to employers NICs will ensure that

If an average 2 million farm can’t handle. 10% tax on a generational basis (1 mill exempt and the next mill at 20%) then maybe it needs better management.

I’m not sure how it works, but are you suggesting on a £2m farm you would need to find £200k cash to pay to the tax man when handing on to the next generation?  Thats a hell of a lot of money to find. Small farms are not rolling in money

The impact will be that farms get sold to the big companies. The big companies do not care about local issues, support the local community or environment. One local farm around us is owned by a large company. They get continual complaints on every front

That’s ok I suppose but it’s the sort of detail that voters will remember in 5 years time at the next GE and likely punish them for.

Most voters only remember what shit X, Facebook, TikTok feeds them that week.

I don't get the farm thing - surely a farm worth over £1m in assets is being run as a Limited company and has to comply with all the usual company rules. It'll have directors and should be treated no differently to any other family firm that gets passed from generation to generation.

The 7 year gifting exemption still applies to farms doesn’t it?

If an average 2 million farm can’t handle. 10% tax on a generational basis (1 mill exempt and the next mill at 20%) then maybe it needs better management.

Maybe ask yourself that next time you buy 4pints of milk for £1.50. When the supermarkets control the price, "better management" would have a hell of a stretch to find 200k cash or even the equivalent monthly mortgage payment

treated no differently to any other family firm

Farms have their own rules (with good reason, historically).

There's a colossal amount of ignorance and prejudice on this forum when it comes to farming.

Don’t forget the Daily Mail does like some budgets so to suggest it is only negative is wrong

There’s a colossal amount of ignorance and prejudice on this forum when it comes to any industry. That's the internet for you.

There's also been the announcement of a large budget increase from 2025-26 onwards for HMRC, adding an additional 13% to the overall budget and proposals to recruit and train 5,000 additional compliance staff.  So, without fanfares and rate rises, we should see a significant reduction in the tax gap, quietly increasing the proportional yield from many of the existing taxation streams.  I bet that the Mail won't be happy with that scenario, one little bit.  Let's hope that there's a decent range of tighter legislation getting added, to actually give some bite...

A1 duel upgrade has been cancelled here, turns out after spending £67m buying land the tories lied about the reserved funds. So, after they had 15 years to start the project the local Tory councillor is blaming Labour for wasting £67m without even a spade in the ground.

Apparently the farm thing means that a £2 million pound business will have to pay £20,000 a year for 10 years.

Doesn't seem clippling to me but I have no idea if a farm worth £2 million is a particularly viable business?

Could be bullshit but I’m seeing people on Twitter saying the cost of maintaining the fuel duty freeze and the annual bus ticket revenue for the whole of England are practically identical at about £3bn. IOW you could have made all buses free simply by reinstating the fuel duty escalator…

Pretty sure that the vast majority of folk who take the bus can afford the (subsidised) cost, so why should the rest of us pay more tax so they'll travel for free?

There’s a colossal amount of ignorance and prejudice on this forum when it comes to farming.

People know what they know. I don't know about farming and the regulations related to farming so that's why I questioned it above.

Like I'm sure you don't know the ins and outs of how VAT is applied to printing (my industry).

Re the IHT on Pensions:  assuming someone passes after 75, the recipient(s) will, under current rules, pay their marginal rate on withdrawal.  If the entire pension is taxed upon inheritance, does that mean it just shifted all the taxation up front and the funds are then moved outside the pension wrapper?

Taxing the entire value up front AND keeping it inside the pension would result in double taxation.

So if the recipient were to leave a fund to grow it might yield higher tax returns as it's drawn down later?  So, actually this could be a net reduction it tax receipts by this move.  Just changes cash flow to an earlier point in time for the government?

They're having a consultation period to work out the details.

The trouble me with farms is the values are massively affected by how much a nicish house with a garden is worth in the area. Down here a 4 bed house with a large garden is £1mm on its own, so anything with significant land will be breaching hard into the iht, whereas the same size farm in the north is likely worth much less. I think the farmhouse might pass into the non-farm property up to 1mm bucket, but not sure how you assign value when everything is just bundled into one

Taxing the entire value up front AND keeping it inside the pension would result in double taxation.

Does it?

If you owned a company outright rather than via shares wrapped up in a pension then surely you would pay inheritance tax on the value of the company, but that doesn't get you out of paying tax on future dividends or sale of the company?