I am grateful to Jolyon Maugham for pointing out what might best be called the bleedin' obvious. He has reminded me, via his blog, of this
This has now been put forward as draft legislation in the summer budget, recently announced.
There is just one problem though. As Jolyon puts it,
You'll remember the Budget Red Book published last week which recorded an increase of 7.5% in the rate of tax paid on dividend income above £5,000:
Which as Jolyon points out, is quite definitely an increase in income tax that is occurring in the very same budget that outlaws such increases.
Some legislation is, it seems, not worth the paper it is written on, even before it is passed.
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Let battle begin on the definition of “income”. Those in the know will point out why dividends are very definitely income. But such minor things as expertise and evidence having long been ignored, can there be much doubt that the government and its trolls will present one spurious explanation after another to “prove” that dividends are very definitely not income?
Perhaps we’ll even experience another Worstall moment.
But surely even if someone manages to somehow prove that dividends are not income (which I can’t see how they could), it is still income tax that is being charged, and that is what they said they wouldn’t put up.
Being a small business dividends for me are definitely an income, whether it is right or not that I take my profits out that way rather than as salary (and since big businesses do that I cannot see why I should be treated differently because I am small). The government is also planning to remove tax relief on expenses for small business – since I generally have to work away from home this means I will be paying expenses on my living expenses too which for me is again an increase. Again, big businesses are allowed to claim things like hotel costs as expenses giving further unfair competition (and MPs have well published expenses too which are paid out by their generous employers). My personal taxation has increased more than any budget I have lived through.
So, what a surprise, the Consertvatives were lying when they made their ridiculous pre-election pledge. I’d expect nothing else from a party composed of cynical, vinidictive, hypocritical liars.
Just one thing David; I’m assuming you weren’t one of the turkeys that voted for them in the election? Sorry if that appears personal, but there are going to be a lot of peole who voted for this government that will regret it, sooner or later.