You would hope for this effect but also if households have been running down their savings and businesses running down reserves during the shutdown they may have a more risk-averse attitude so consumption and investment will fall, especially as future expectations will be more negative - even those in jobs will be more fearful of their job security and businesses may anticipate future falls in demand. Remember there is potentially no deal Brexit at the end of the year and all the associated additional costs that will come from that.

I'm guessing you're one of those who think we'll just return to how it was before?

I think the UK, and the world for that matter, will be a very different place post COVID-19. If anything, I think people will become more thrifty, and more inclined to save than spend, ready for the next global disaster, whatever form it takes.

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Indeed, and people will stop to think about over paying for things, once they have gotten used to (if they haven't already) not paying £3.20+ for a pint etc. and remembered you can actually [i:2ues2c6awalk[/i to a lot of places in less than 30 minutes, habits will change. My big concern is extended credit, I know people taking 3 month mortgage holidays, not because they need to, but because they can, I doubt very much they are invesring the money elsewhere. I'd also be interested to know if anyone else has had a similar email to the one I got yesterday, saying my credit score had changed (from Experian, which I have to subscribe to for ID purposes for contracts), when I checked it last it was mid 700-800 ish, now it is 999! It may have been a one off, but it does seem strange.

I drink in Wakefield and £3.20 a pint is pretty much top end. It's a bargain when you think a pint in Leeds is verging on London prices; £4.50 - £5.50+

Last time I spoke to my Mum, she asked if it was worth me getting a mortgage holiday or looking into government schemes. I'm on full pay, my wife is on full pay, why the hell would we want to add interest or more debt?! If anything, we'll be using this lockdown period to pay more off and build up savings. Like you say, I can imagine there will be plenty who will be doing it because they can.

HS2 money doesn't exist without HS2 - it's funded by future income streams and isn't a pot of revenue expenditure which we can dip into.

We should increase income tax, especially in the higher bracket(s), increase corporation tax, try and get some global co-operation on tax avoidance and immediately address some of the glaring inheritance tax loopholes.

What inheritance tax loopholes? Inheritance tax should be abolished IMHO, people have paid taxes already, it is very much a tax driven by envy.

VAT comes from already taxed income, for example, and presumably the inheritors haven’t paid tax previously on what they are inheriting.

The success of our economic system is based around productive economic activity. We can tax income, transactions and assets. Intuitively, and based on no research or evidence whatsoever, I wonder if less of the first two and more of the latter would be a better mix for the UK economy. You could, ideally, tax assets differentially to encourage productive investment ahead of rent-seeking and speculation.

But the person bequeathing the inheritance has paid tax during the time they amassed the inheritance - surely that is unfair that the proceeds of potentially doing without conspicuous spending to invest in a property should be taxed once again?

The problem with your theory is that the whole economic system is routed in the value of property - if you have these type of assets you can borrow to invest to increase income and transactions. How many small businesses start with loans guaranteed by PG's on their house. Property businesses are just as legitimate an enterprise as a manufacturing business. These businesses are long term investors who often provide the facilities for your income and transaction generation. Most businesses couldn't afford to invest in the purchase of their property.

Every choice is a sacrifice. One could easily make arguments about the unfairness of taxes on income or transactions. Wealth taxes are not at all unusual in the US. And aren’t capitalist arguments usually based around hard nosed efficiency rather than woolly fairness?

As with income tax, I would suggest there’s a threshold and it could easily be set at a level that has no impact on those looking to secure modest five-figure loans to establish small businesses. It is also far from all about inheritance.

Legitimacy is a slippery term, but I would agree that many property businesses put capital to use in a way that benefits the economy, investing in building and renovation to provide capacity. And many rental businesses offer value by offering flexibility. However, profit based entirely or almost entirely on ownership without adding much or any value, while possibly efficient on the personal level, isn’t efficient for the broader economy.

To use a simple ye olde example, imagine a land owner is paid rent by a dozen small holders who farm the land. While they couldn’t afford to buy their plots, the land owner isn’t really offering any value - the existence of the land isn’t dependent on his ownership. Nonetheless, over time he becomes wealthy and neighbouring land becomes available. Ideally you’d want him to invest his capital in something innovative that may boost economic growth, so that should be incentivised. Just outbidding the neighbouring tenant farmers for land is inefficient and should be disincentivized.

If you want encourage work and productivity, there’s a case for low income tax. If you want encourage economic activity there’s a case for minimising taxes on it. The arguments for an absence of wealth taxes seem weaker to me.

Capitalist economic systems are malleable and adaptable. Our system may be rooted in the value of property, but it could be tweaked to be more rooted in the value of work and productivity, making it easier for anybody who works hard to generate the capital they need to start a business, rather than having to rely more on pre-existing wealth. That’s desirable, isn’t it?

Capitalism revolves around the efficient use of capital and maximising the outcomes of investing it whilst limiting the financial exposure to the value of the initial investment. It seems odd to me that you pay taxes like everyone else yet you should be penalised because you have either made better investment decisions or you have sacrificed spending to build up savings?

Most businesses would see property as a poor investment - why - because its growth in value is so slow, would you invest £1m in a building that grows at 2% or put it into a a business that delivers 10% even including the rent of the building. Property investment is a specialist long term investment that supports business - investing in the construction of a factory or an office block is a long way removed the Feudal land owning system pre the industrial revolution.

Yes low taxation is an encouragement but you amongst many on here were calling for increases in corporation tax - so I am confused as to your views and which side you are on.

Without the investment in property nobody has anywhere to work from - its an intrinsic element of the capital model. The lower the initial investment in a start up the more chance it has to get through the initial learning curve - that's desirable isn't it?

This is all well and good but, if your investments grow as a direct result of government policy, you could be making huge gains without actually "doing anything" and in those circumstances, it's "right" to pay some additional tax on your gains.
The bottom line is that it is ridiculous for everyone to pay the same amount of tax - remember the poll tax
Therefore, the heaviest burden should always fall on those who can afford to pay, regardless of how each of us have chosen to live our lives.

If I pee my income up against a wall on a Friday and Saturday night and smoke 40 a day, I will have paid over plenty of "extra" tax and equally, if I choose to spend nothing and save every penny that I earn, I will have paid relatively little.

It should be made much harder for individuals to hide their cash offshore and corporations should pay sensible amounts of tax on their profits but, the bottom line is that the cash will need to come from somewhere and you cant tax those with nothing and therefore the burden will rightly fall on those who have most.

And efficient use of capital is more likely with well aligned and directed incentives. I’m not suggesting this as punitive. It is also about ability to pay, the same as progressive income tax rates. Those that have benefitted most from society (as well as their own hard work and talent) putting more (per person) back in to support ongoing societal and broad economic well being. I assume we agree that is the goal, irrespective of what the optimal route to it might be.

Do you find Council Tax odd? Would you argue for something like the Poll Tax in its place?



Why the boom in private landlords until the government put in tax disincentives? Property in some ways carries low risks, and according to my homes under hammer-based research, a 2% annual return on investment would be unusually meagre even before any appreciation in the value of the asset. Obviously investment in construction and renovation is different... and wouldn’t be especially imperilled by a personal wealth tax, so far as I can see.



Did I? It sounds plausible, but I don’t remember. My point here isn’t about high tax or low, but the source of tax revenue and highlighting a source that I think has been rather neglected, imo. A new wealth tax could alleviate fiscal pressures elsewhere.



I agree with both of those statements, although I don’t see how a wealth tax or well-targeted incentives would reduce investment or make starting up less affordable. I think you’re extending my criticism of rentier capitalism to any business where there’s a rental payment.