I haven’t the heart these days to write much about politics. I’m trying to preserve what little joy and hope remains in me. I may find welcome respite when I take up a new job in March after a really tough year and a bit of underemployment (woo, yay!). That being said I have found it fascinating that contrary to “jobs jobs jobs” the focus of the US House of Reps. has been on making sure women know their place. Quelle surprise!
I went away for three days to train in development work, and returned full of vim… Until I caught sight of an article about the latest fumduckery it appears my government plans to subject us to.
‘I would love to see tax reductions,” David Cameron told the Sunday Telegraph at the weekend, “but when you’re borrowing 11% of your GDP, it’s not possible to make significant net tax cuts. It just isn’t.” Oh no? Then how come he’s planning the biggest and crudest corporate tax cut in living memory?
If you’ve heard nothing of it, you’re in good company. The obscure adjustments the government is planning to the tax acts of 1988 and 2009 have been missed by almost everyone – and are, anyway, almost impossible to understand without expert help. But as soon as you grasp the implications, you realise that a kind of corporate coup d’etat is taking place.
Like the dismantling of the NHS and the sale of public forests, no one voted for this measure, as it wasn’t in the manifestos. While Cameron insists that he occupies the centre ground of British politics, that he shares our burdens and feels our pain, he has quietly been plotting with banks and businesses to engineer the greatest transfer of wealth from the poor and middle to the ultra-rich that this country has seen in a century. The latest heist has been explained to me by the former tax inspector, now a Private Eye journalist, Richard Brooks and current senior tax staff who can’t be named. Here’s how it works.
At the moment tax law ensures that companies based here, with branches in other countries, don’t get taxed twice on the same money. They have to pay only the difference between our rate and that of the other country. If, for example, Dirty Oil plc pays 10% corporation tax on its profits in Oblivia, then shifts the money over here, it should pay a further 18% in the UK, to match our rate of 28%. But under the new proposals, companies will pay nothing at all in this country on money made by their foreign branches.
Foreign means anywhere. If these proposals go ahead, the UK will be only the second country in the world to allow money that has passed through tax havens to remain untaxed when it gets here. The other is Switzerland. The exemption applies solely to “large and medium companies”: it is not available for smaller firms. The government says it expects “large financial services companies to make the greatest use of the exemption regime”. The main beneficiaries, in other words, will be the banks.
But that’s not the end of it. While big business will be exempt from tax on its foreign branch earnings, it will, amazingly, still be able to claim the expense of funding its foreign branches against tax it pays in the UK. No other country does this. The new measures will, as we already know, accompany a rapid reduction in the official rate of corporation tax: from 28% to 24% by 2014. This, a Treasury minister has boasted, will be the lowest rate “of any major western economy”. By the time this government is done, we’ll be lucky if the banks and corporations pay anything at all. In the Sunday Telegraph, David Cameron said: “What I want is tax revenue from the banks into the exchequer, so we can help rebuild this economy.” He’s doing just the opposite.
My mood has officially returned to miserable.
Good to see the Republicans are focused on job creation and fixing the US economy…
Steve Benen of the Washington Monthly:
Last week, after a rather pointless vote to repeal the entirety of the Affordable Care Act, House Republicans announced their second major initiative: the “No Taxpayer Funding for Abortion Act.”
Nick Bauman at Mother Jones breaks down the misogyny:
For years, federal laws restricting the use of government funds to pay for abortions have included exemptions for pregnancies resulting from rape or incest. (Another exemption covers pregnancies that could endanger the life of the woman.) But the “No Taxpayer Funding for Abortion Act,” a bill with 173 mostly Republican co-sponsors that House Speaker John Boehner (R-Ohio) has dubbed a top priority in the new Congress, contains a provision that would rewrite the rules to limit drastically the definition of rape and incest in these cases.
With this legislation, which was introduced last week by Rep. Chris Smith (R-N.J.), Republicans propose that the rape exemption be limited to “forcible rape.” This would rule out federal assistance for abortions in many rape cases, including instances of statutory rape, many of which are non-forcible. For example: If a 13-year-old girl is impregnated by a 24-year-old adult, she would no longer qualify to have Medicaid pay for an abortion. (Smith’s spokesman did not respond to a call and an email requesting comment.)
Given that the bill also would forbid the use of tax benefits to pay for abortions, that 13-year-old’s parents wouldn’t be allowed to use money from a tax-exempt health savings account (HSA) to pay for the procedure. They also wouldn’t be able to deduct the cost of the abortion or the cost of any insurance that paid for it as a medical expense.
Other types of rapes that would no longer be covered by the exemption include rapes in which the woman was drugged or given excessive amounts of alcohol, rapes of women with limited mental capacity, and many date rapes.
No doubt that the failure of this bill to pass the senate will be demagogued to the max in the districts of its proponents. Keeping the base riled up and the campaign funds coming in. I would love to be able to write that Smith and the co-sponsors of this bill have beaten their careers with an iron rod; but alas.
So the Chancellor wanted to take credit for improved growth predictions last November, but now it has been revealed that the British economy shrunk by 0.5% in the last quarter of 2010 (zero growth if you account for the weather) he’s changed his tune:
These are obviously disappointing numbers, but the ONS has made it very clear that the fall in GDP was driven by the terrible weather in December.
I think Osborne mentions the weather about 15 times during his interview with the BBC. However, highlighting the fact that the UK was brass monkeys completely elides the reaction of the private sector to public sector cuts and anticipated tax increases. I find it interesting that the Chancellor still appears confident that the private sector will pick up the slack as public sector cuts continue apace.
Sarah Palin releases a video to remind us that she too has been victimised by the senseless act of violence in Tucson… Because she is now under criticism.
Journalists and pundits should not manufacture a blood libel that only serves only to incite the very hatred and violence that they purport to condemn. That is reprehensible.
I actually happen to think that anyone attempting to establish a direct causal link between Palin’s words and Loughner’s actions is over-egging the custard at best. But goodness me! A Jewish woman is lying in an ICU with a gunshot wound to the head, and Palin is making this about her and her enemies; accusing her critics of blood libel.
This strikes me as completely tone-deaf, and a very inapt charge. The criticism she’s under really cannot be compared to the murderous slander Bible-waving bigots and maniacs have committed against Jewish people.
Another thing that gets my goat is that after news broke of the tragedy Palin’s people got to work scrubbing her Facebook and Twitter pages of the now infamous map of swing districts with cross-hairs over them. If she truly believes that her rhetoric was beyond reproach, then I would have liked to have seen her stand by her rhetoric and explain how it has contributed to meaningful political debate.
Instead, one of her spokespeople was caught in a lie claiming that they were surveyors’ symbols. An understanding not shared by Palin:
If you gave her an enema, she’d fit into a matchbox.
A US congresswoman was shot in the head at point blank range today and six people killed, including a nine-year-old child and a federal judge, at a public meeting outside a grocery shop in Arizona.
Giffords’s assailant was last night named as a 22-year-old Afghanistan veteran Jared Lee Loughner. He was described by witnesses as a young white man who looked like a “fringe character”, clean shaven with short hair and wearing dark clothing.
This is as senseless to me as the murder of Salmaan Taseer, and as maddening. The US has looked to me to be awash with violent political rhetoric of late, and I really hope this fellow Loughner was not inspired by any of it.
The rise in VAT to 20% took effect at midnight this morning, and of course the Labour Party have come out swinging, with Labour leader Ed Milliband calling on the Chancellor to apologise for what he called a misleading claim that VAT was the fairest tax to increase.
The Chancellor has argued that the VAT increase was the most progressive policy option because income increasing the level of income tax or employer-side National Insurance contributions would cost jobs, while this policy, combined with other deficit reduction measures, would increase employment.
In response Ed Milliband claimed that: “Everybody knows that it’s poor and middle-income families that will be hit hardest”; implying that the Chancellor was fibbing when he included the VAT increase in the class of progressive policy options.
The Chancellor points to the Institute for Fiscal Studies (IFS), which has argued the policy is “mildly” progressive because the poor spend a higher proportion of their lifetime income on necessities like food and domestic fuel, which have reduced or zero VAT.
I’m leaning towards Milliband’s side on this one, as there are a few things that make me give the IFS’ argument the side eye:
- Many reasonable purchases are not of zero-rate or reduced rate items. Wouldn’t an increase in VAT reduce the range of items that people on lower incomes can purchase?
- Plus, wouldn’t the cost of necessities rise anyway? My understanding is that a sales tax like VAT increases the cost of doing business. Any extra costs would be passed onto customers, methinks. This would impact the ability of the poorest to make savings.
- The IFS might be making unreasonable assumptions regarding similarities between the poor and the rich.
Politically this may be somewhat embarrassing for the government, because a 2009 statement from David Cameron contradicts the Chancellor’s assertion. Here’s what he said:
You could try, as you say, to put it on VAT, sales tax, but again if you look at the effect of sales tax, it’s very regressive, it hits the poorest the hardest. It does, I absolutely promise you. Any sales tax, anything that goes on purchases that you make in shops tends to . . . if you look at it, where VAT goes now it doesn’t go on food obviously but it goes very, very widely and VAT is a more regressive tax than income tax or council tax.
Also, spare a thought for Nick Clegg, human shield, once again facing the prospect of taking a thumping, since it was quite clear from the Lib Dem election campaign that they were all for attacking the Conservatives on this policy.