21 items | 109 visits
What's happening in U taxation issues
Updated on Jun 09, 08
Created on Feb 14, 08
Category: Business & Finance
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The main indirect effect of the proposed increase in taxes on the non-doms (if they were to leave and not spend as occasional or even regular visitors as much as they now spend as residents) is through their consumption of non-traded goods and services, including charitable giving – a form of conspicuous consumption unless it is double-blind. The demand for magnums of 1961 Petrus (at £18,000 a bottle) would suffer. So would a few luxury shops, restaurants and studs. Upper bracket property prices in London and the home counties would fall. With a bit of luck, the fall in property prices would spread more widely.
Guy Hands will on Wednesday warn he is reviewing whether to move at least part of Terra Firma, his UK-based buy-out firm, overseas in protest at the recent tax increases on capital gains and non-domiciled residents.
“We are concerned by the recent changes to the UK tax laws,” says Mr Hands, the first buy-out boss to warn he may flee the country since the government started fiscally targeting rich private equity executives last year.
But during the past quarter-century, as deregulation has turned the economy into a casino, the Federal Reserve has had to mount major rescues at least six times. In the early 1980s, it bailed out the big New York banks, some of which lost more than the total amount of their capital in failed speculative third world loans; the money-center banks would have been adjudged insolvent if the Fed hadn't bent its usual capital-adequacy rules. Next, the Fed poured huge quantities of liquidity into financial markets after the stock market crash of 1987, in which the market lost more than 20 percent of its value in a single day. The Fed intervened again on several occasions after speculators destabilized several third world currencies and economies from Mexico to Malaysia. The Fed cleaned up after the aforementioned Long Term Capital Management collapse. It flooded markets with money after the dot-com crash and the attacks of September 11, and most recently in the credit crunch of summer 2007.
The point is not that the Fed should turn its back when financial markets are on the verge of replicating the Great Crash. The point is that the Fed has become the chief enabler of a dangerously speculative economy. It is simply not possible to get the right balance of financial prudence and financial liquidity using monetary policy alone. That's why we once had a more carefully regulated economy.
in a report published by the UK's Times newspaper, a Terra Firma spokesman was quoted as stating that "there is absolutely no plan to move our main operations". “This is about reviewing the expansion of our overseas operations in response to the tax changes," the spokesman told the Times. Since 1994, Terra Firma has invested approximately EUR11bn, mainly in Europe. The company has offices in London, Frankfurt and Guernsey, owns eight companies and claims to have paid GBP15.2mn in corporation tax last year.
Bad arguments against fiscal devolution ...
"The Federation believes that the introduction of any kind of service tax or local income tax in Scotland would be problem-atic and result in additional costs for employers who would be expected to provide local authorities with information on staff salaries."
That argument still applies, said a spokesman, who pointed out the particular concern businesses had where employees could travel in to work from difference council areas all levying different LIT rates. "That bureaucracy would be time consuming and costly, so our members would prefer a flat rate across Scotland," he said.
Iain McMillan of CBI Scotland said they had several concerns, including the whole perception of Scotland as a place with higher income tax, the fact that the 3p would apply not just to the basic rate but up through the bands, and the impact on organisations whose payrolls were on both sides of the border.
UK Tax - scrapping of lowest rate makes it less progressive. Have the worst-off benefited under labour?
Business Secretary John Hutton has ruled out a rethink on the decision to scrap the lowest tax band, amid claims Labour has abandoned low-paid workers.
He said he did not think it possible to go back on a decision to scrap the 10p rate, despite Labour MPs' unhappiness.
The new tax year, which starts on 6 April, brings in an unusually large number of changes to both personal and business taxes.
Many of the changes were first announced in 2007, in either that year's budget or in the later pre-budget report.
By Jim McMahon
21 items | 109 visits
What's happening in U taxation issues
Updated on Jun 09, 08
Created on Feb 14, 08
Category: Business & Finance
URL: