I well remember back in '73 when VAT was introduced they promised that it would only be levied on luxury items. The definition of luxuries certainly broadended over the years since! Whenever someone says of a new law, "it's just the thin end of a big wedge" they turn out to be so often proved correct.
They *still* come with taxes attached to the purchase. Everything from VAT to Air Passenger Duty.
It is true that what Parliament and the courts apparently regard as luxury foodstuffs are not zero-rated.
Posting a URL and saying "It's all in there if only you read it" is NOT an argument.
If you have an argument to make, you must make it in your own words.
If you don't, you haven't got one.
"Regressive" does not mean what you (and possibly that author) think it means.
You could look it up. I assure that percentage taxes (like VAT) are not regressive. Flat rate taxes such as tobacco, fuel and alcohol duties are regressive since they account for a larger proportion of a low income than they do for a high income. That's what economists mean when they say the price of something is regressive on the poor.
VAT cannot amount for more than a certain proportion of anyone's income, and the less income they have, the less VAT will be demanded of them (for the most obvious of reasons).
Thought about "regressive" yet?
You could try:
QUOTE: A regressive tax is a tax applied uniformly, taking a larger percentage of income from low-income earners than from high-income earners. It is in opposition to a progressive tax, which takes a larger percentage from high-income earners.
KEY TAKEAWAYS A regressive tax is a type of tax that is assessed regardless of income, in which low- and high-income earners pay the same dollar amount. This kind of tax is a bigger burden on low-income earners than high-income earners, for whom the same dollar amount equates to a much larger percentage of total income earned. A regressive system differs from a progressive system, in which higher earners pay a higher percentage of income tax than lower earners. In the U.S. and certain other developed nations, a progressive tax is applied to income, but other taxes are levied uniformly, such as sales tax and user fees. ENDQUOTE
I expect you're going to argue that it can't apply in the UK because it mentions dollars.
Not wrong.
You need to understand what low-, medium- and high-order mean.
So true.
Only "plenty" in the sense that there is plenty to choose from.
Indeed. But it's a safe bet that the Graun isn't complaining about inability to afford caviar, smoked salmon and £10 bottles of Balsamic of Modena.
Obviously not. If he did, he would not misuse the term "regressive".
It always seemed odd that VAT is charged on adult clothes, but not children's, when children can walk around naked without being arrested, but adults can't.
I have, and you have conveniently forgotten my words. Most would sooner accept words from other sources that corroborate my claims. However much you prefer this to be a debating society, it isn't.
I have, and you are blind to the words I have used, more than once. Perhaps English isn't your native language.
It means exactly what the author is saying. However much you rather it didn't.
Your ignorance is astounding. You have been shown on more than once that people on poor incomes do pay more on VAT than those on high incomes, however hard you wish that not to be true.
I have, and it shows VAT is regressive tax by your very own definition as those with a low income pay more VAT as a proportion of their income.
Are you saying that people on low incomes pay a lower VAT rate, would it be 15% where higher income earners have to flash a card around to pay
20%? Your ignorance is astounding. <snip>
Quite.
Another article that says VAT is a regressive tax:
I expect you're going to argue that it can't apply in the UK because it's written in the USA.
By all means continue to look a plonker trying to redefine "regressive tax". Only someone with failing faculties would believe more VAT is paid by higher income households as a proportion of their income. You really couldn't make it up.
When was the last time you did any DIY?
The only misuse of regressive is in your beliefs. Go on, find a few UK articles that say VAT is not a regressive tax, you know you want to.
They are WHEN COMPARED WITH INCOME TAX.
Thats not what regressive means when comparing taxes.
Wrong.
Yes, but with income tax, those on the lowest incomes pay no income tax at all. Not so with VAT.
And that means that the VAT is a regressive tax and income tax isnt.
And that is saying what he said, that the VAT is a regressive tax.
Fraid so with holidays in france so cheap now.
I do thanks.
And so no other taxes if you get a lift in someone elses car in the chunnel or ferry.
What I said.
He didnt.
Moments ago with his silly version of what regressive taxation means.
Plus Stamp Duty.
You might as well post a link to the index page of Encyclopaedia Britannica. It'd be just as convincing.
Come on... don't act daft.
What you say simply isn't possible.
A moment's reflection would show you that.
At current rates, no-one can pay more than one-sixth of their net income in VAT. And hat's only if everything they buy is at standard-rate VAT.
The lower the net income, the smaller the amount of VAT that can be paid (or even demmanded) from it.
Impossible. See above.
"Same dollar amount"
Is that the way that VAT works?
That isn't even an argument. It all hangs on "appears".
There is no need. The definition is well-established. And VAT is not a regressive tax. Fuel duty, alcohol duty, tobacco duty and similar taxes are regressive. VAT is not.
Is that the only way you know of trying to put an argument?
Why?
Its just another example of his very poor way of saying what he means. He actually means that those on low incomes who spend all of their income because their income is low, pay a much higher PERCENTAGE of their income in VAT than those who earn more and don't need to spend all their income and who choose to save it instead of spending it on VATed stuff.
You mean 20%
That is the case for some who choose to eat what is VATed and that isnt uncommon with some who can't cook etc.
Yes, but he is talking about the percentage, not the absolute amount.
Nope, not when he now says PROPORTION.
Useless.
Not what he is discussing.
It is when compared with income tax.
Wrong.
No, I don't.
£10 + 20% VAT (£2) = £12. £2 is 1/6th of the £12.Someone earning £1200 a month net and who buys nothing except items bearing VAT at 20% will pay £120 a month in VAT.
That's 1/6th of £1,200.
[ ... ]20% is... er... a percentage. It is the same percentage (maximum) for every income level. 1/6th is easily expressable as a percentage.
As far as I know, children's clothes are sold in a free market. Not charging VAT just allows the retailer to charge more.
Likewise, reducing stamp duty puts house prices up. I'm certainly not an economist, but that does seem obvious to me.
It certainly allows the retailer more latitude as to the sales margin.
Whether that means a price increase is going to depend on various other factors, some of them in operation very temporarily (fashion and seasonality are important in the rag trade, which is why clothing ends of ranges so often feature in the "sales").
It allows buyers more scope to bid a higher price than they might be able to if the Duty were payable at a higher rate (or at all). It does not automatically mean a price increase, since the price being asked and the price being offered are themselves dependant upon... well... various other factors.
I suspect the main effect of stamp duty on house transactions is to distort true price discovery at the points where thresholds and rates are set by the Chancellor of the day.
I meant that it makes no sense to say 1/6th, you should have said 20%
The 20% comment has nothing to do with that particular sentence.
Duh.
But it makes no sense to use anything but a percentage.
So are adult clothes.
That's completely silly.
That's obvious.
More fool you.
And because hardly anyone wants to hold out of season stock for half a year.
But it isn't 20%.
It is 1/6th (16.67%).
It isn't possible to address an unknown amount of income with an absolute figure for the maximum amount of VAT that may be paid from it. One can only use the 20% figure and calculate the max amount using the
1/6th rule:(100% + 20%) ÷ 6.
You have obviously forgotten how the topic came up.
Exactly. Clothing stocks tend to have a limited shelf life. There are exceptions, but the sector is very dependant upon seasonality and on fast fashion.
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