This is a poorly thought out LibDem policy. They clearly don't understand that the 'rich' don't pay significant tax because they are rich enough to afford accountants and tax advisors who put in place structures to mitigate their tax. The poor don't pay significant tax, because they just don't earn enough. This increase will only affect the hard-working man and women on the street who are investing for their future, their children and their retirement. What incentives are left to work hard in this country ? Very few if you ask me !
Having CGT out of step with income tax was an insane Labour policy which thankfully seems destined to be short lived. However, I don't think the LibDem idea of restricting the CGT allowance to such a low figure as £1000 is sensible. Hopefully the Conservatives will re-instate the pre-Brown ideas of indexation allowance and taper relief, while taxing CGT at income tax rates.
No different to other scams by government. Hit the thrifty to subsidise the scivers, malingerers and those whose hobby is "working the system".
Reducing interest rates was a move to penalise thrifty pensioners who tried to look after themselves in their retirement, whilst appeasing those who took on mortgages and loans they should have known they could never repay. Same old game - look to where the most votes may be. Cynical? Yes and were I younger I'd leave this lousy country tomorrow.
The people are loosing their moral while becoming modern. The society needs to be attentive that moral value. Well, it shocking and needed and immediate attention to short out at the earlier.
I agree with everything Rohan says. It is always the people who pay all their bills, don't claim any benefits and manage to save for a rainy day who get taxed extra. I personally am sick to the back teeth of it all.
CGT increases should be stepped to take allowance of the length of time an asset is held. Smaller/older investors who have kept their savings in property or shares for over 10 years should pay zero CGT. Speculators who buy and sell within a year should pay 50%. Assets held between 1 and 10 years should pay 25%. Simple, yet fair!
This will be unfair to people who sold a home and down sized with the money left over as in my case i bought a small bungalow with a smale loan then let the local council let to the homeless this is my pension i feel i am gaining and so are the young family living there
I could have just spend the money on a few good holidays and then got the gov to help me out so no this needs more thinking about . People who can afford to have a second home and leave it locked up 10 mts a year thats different
I'm in agreement with Counsellor7.The longer you keep an asset the more relief you should get. I invested for my kids benefit so they could get on the property ladder. Now this Tory Lib dem farce is going to tax away any chance of getting a return on my investment.
I started with nothing but I have worked hard and I bought 2 buy-to-let properties one about 6 years ago and the other about 2/3 years ago which I planned to use for my retirement instead of investing in a pension.
I think this is an absolute outrage and think the ConDem coalition should be "condemmed" to history as soon as possible. What is the point of working hard and skimping to try and better yourself when the govt do this to the normal hardworking person. I feel like giving it all up signing on the dole, getting the state to pay for my home, etc. Is it now really worth the stress, etc of trying to progress? Want to cut the budget deficit then bring back Maggie's type of politics, stop Mollycoddling the people, bring back national service for those who choose not to work or work illegally to claim benefits/avoid child support etc. The amount of fraud in the state benefit system must be more than £6billion why not state here, lets make the UK more efficient by getting the country off benefits and back to work.
We had to move home with work and have not been able to sell our old house despite it being on the market for 2 years. It is unfair to tax us so much when we sell it as we've needed to use the money from remortgaging our house to buy this one.
I too agree with Counsellor7. We bought a house for our daughter and granddaughter to live in when there were no suitable rented properties (private or otherwise) for them in the area. This was 12 years ago, since when she has been paying us a small rent to cover costs (taxable income of course). This wasn't an investment opportunity, it was a neccessity. We will never regain the capital we have put in and the house will be hers eventually. If we sign over the house for nothing we pay CGT; if she finds she is able to buy the house we will pay CGT, if she inherits it - guess what? - tax will have to be paid. This is what you get for taking on the responsiblity of looking after your own.
We are not investors looking for profit, we would just like some money back for our retirement without feeling penalised.
People get all sorts of tax advantages for doing buy to let, so they deserve to get taxed more for it.
I think to government is doing the right thing. It may be very hard for many of us including myself, however we must act now for the long term sake of the country.
Stop thinking short term and me me me. I will suffer in the short to mid term but it must be done to save the financial stability of our country.
Come on guys. Whatever tax increases they bring in some of us will not be happy. Lets just all accept that we will all have to feel the pain in some way or other and then get on with it.
BIG No - it is not fair, especially as:
1) Pension scheme's are detriorating in terms of returns
2) State pension is financially arguably delivering basic living standards if that
3) Other tax increases are clobbering households anyway not to mention rising RPI
4) the State has already confisticated a lot of shareholder assets (i.e. bank shares) with a blink of an eye. You do not have to be a direct shareholder to have lost out here either. Various employers and personal pension schemes will have been hit this way and also unit trust investments even if that is in ISA wrapper.
In the end if the State wants people to be "independent" then it has to leave some room to make sensible returns whether that's through income or capital gains.
At this rate, the small percentage of people who are trying to make an effort to cater for themselves & their families will be left with absolutely nothing to gain for slogging away during their working life which is being cut short anyway. Don't care what anyone says - over 55s are being shut out of employment market.
I agree, my husband and myself started a business with £100 in the 1960's and although we are
now retired our daughter has carried it on,giving part-time jobs for some 20 people. When we
started we worked days,evenings and weekends to make it work. We didnt have holidays and
we couldn't be sick beacuse we couldn't afford it. In 1980 we bought a small piece of land
and built a bungalow on it for our eventual retirement. We 'Told Sid' and bought some gas shares
then some electicity shares and as my husband was paying in for a pension was given shares
in that company and we also bought some as well. We are not rich, but will now be asked to
pay 40% if we sell any which won't help if we require to be put into a home.
We have people who live not far away from our house who "play the system" they have a
tractor as their form of transport and a boat to go fishing for lobsters. Who's got it right?
What tax advantages would they be? because I don't know of any.
I also agree with counsellor7. I have worked hard and saved and taken risks by taking on Buy to Let mortgages. I am happy to pay my share of tax but resent the fact that my hard work of renovation and maintenance on my properties and the fact that I have provided decent homes for over 20 years is now being penalised. This is in effect an enormous cut in my pension plan. It is always the workers and planners that are penalised.
Nobody here seems to recognise that to make a capital gain one has to buy something and this then has to make a profit but it is at risk of making a catastrophic loss. If one makes a loss then surely to be fair you should get a tax rebate of 40% on the full amount of the loss.
Hang on, it's not June 22nd yet so we don't know what the CGT changes will be. If all they do is reverse the position back a year (while still appropriately taxing the private equity cartels) then I don't really see what people are complaining about!
The libdems wish to bring in wealth taxes of all kinds which are fundamentally unfair. Savers and investors on which the country relies are penalised over and over again. I am moving abroad to make sure my capital gains made at my personal risk are not all given to the overpaid mp's to pay to the overpaid civil service.
Note I am not highly paid but I have always invested for my retirement. I am a professional engineer and despite working at times around 70 hours a week managing multi million pound projects I have never made 60%of the salary a back bench mp makes and with no perks.
To have these numbskulls pontificating about everybody sharing the burden is soul destroying.
this is penalising property investors like ourselves to make up for the mess left by market speculators! It's annoying that we are constantly refered to as property speculators, despite that we have had all our properties for many years, while the real speculators who have caused this mess, speculators who sell stocks & shares & commodities they dont even own are continually refered to as investors whereas they are no better than gamblers, at least if they bet on the horses instead of currencies etc. no one else would be drawn into their seedy world!
It isn't possible yet to comment fairly on the tax rise until we know what it will be but I do think that CGT and Dividend tax (not stamp duty on share buys) should both be brought into line with income tax - if you choose to take money from your company and call it a dividend payment instead of income why should you pay a different rate of tax than anyone else?
This is just unfair and it means that directors can earn more and pay less tax than employees!
I'm no speculator either, just an ordinary working guy who works hard and trying to save what I can afford out of my below average wage.
Trying to better myself in buying a few shares etc. was a big risk for me and I really resent the fact that a huge proportion of any profit my hard earned money makes is effectively stolen in tax.
I'm the one who's working and paying tax already, I'm the one taking the risk with my tiny surplus.
The tax man certainly isn't going to share my risk so why the hell should he share any profit?
Any CGT rise will cause a slump in the housing market. There are a hell of a lot of people with buy to let properties, hence why any government will increase the CGT because as usual it's an easy target.
Many have just the one property (like myself) instead of a pension, so this will hit those at a later date, yet the government encourage us to save because of the pension time bomb!!
Why, why, why do they not get the long term unemployed doing compulsory community work? This would instantly get hundreds of thousand back looking for paid work or stop them doing their cash in hand work, so they would have to sign off.
But as usual this is too clever an idea for MP's.
Should things carry on like this I will be giving up work and living a stress free life with easy money coming in from tax credits.
Let's be sensible here!
We don't know what changes there will be to either the CGT allowance or to the CGT rate.
We don't know what (if any) changes there will be to certain special arrangements such as:
- business assets (from selling your family company to selling shares in the company you work for) which are generally tax advantaged
- your primary residence (currently exempt CGT)
- buy-to-let properties (currently benefitting from a range of tax reliefs)
Not every change will hit the average man on the street, and reverting the CGT rate from 18% to the seller's marginal tax rate will only reverse something that's been in place for 16 months, and (in my opinion) will act to make the tax fairer.
"Not every change will hit the average man on the street" said one 'Guest' recently.
Sadly, the individuals that saved their money and invested it in shares or buy to let properties are not 'the average man in the street', as it has become far too 'average' to max out credit cards; buy when you want, not when you can afford; and spend without a responsible thought to looking after yourself in old age and your children as they set out in life. The more strategically thoughtful, thrifty, sensible individuals are the very ones who will be most unfairly penalised by a blanket CGT hike.
So this tax proposal, foolish if implemented without distinguishing the careful from the profligate, will be applauded by anyone who doesn't have any painstakingly husbanded investments which will lose significant value because of it, and will be denigrated by the rest of us who didn't spend beyond our means and didn't just live for today.
I'm all for protecting the 'have nots' who have had unfortunate life experiences (the vulnerable), but not the 'have nots' who became so through thoughtless, irresponsible and selfish spending (the greedy). Where's the justice?
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