Vir Cantium

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Monthly Archives: October 2007

Back to School for the Race Industry

So there I was, sitting outside the headmaster’s office, waiting to be seen – yet I wasn’t nervous in the slightest. More than once I had been called to answer for some transgression, yet this time was different … probably because it was eighteen years after I had actually left the school and here I was, now a governor and visiting my alma mater properly for the first time since leaving, 3 A-levels in hand, to venture into the big wide world.

In some ways it was like I’d only left yesterday, except I’d occasionally come across a point where there should have been a door, or a classroom had suddenly grown in size. The school is fortunate in that it is backed in capital by a charitable foundation which has enabled it to grow in size – both physically and in pupil roll – and a new science block, sports pavilion and sixth form block have appeared where once was grass or tennis courts.

And they now have girls. A whole big bunch of them in the Sixth Form – which prepares both sexes for co-ed life at University, apparently.

And as with most Grammar Schools – as opposed to good comprehensives – entry is not dependent on parents’ ability to afford to move into the catchment area. And the egalitarianism doesn’t stop there (someone tell the Left, please):

A visitor from the Commission for Racial Equality asked once about the impressive performance of Afro-Caribbean boys at the school compared to the average for that racial pigeonhole group (in fact, around a third of the intake is from an ethnic minority). “What compensatory courses do you run then?” they asked innocently. “What do you mean?” was the reply, “we just treat them the same as everyone else.”

Quaint though the “colour blind” view may be in current race-relations groupthink (albeit held by the majority of people outside the professional equality industry), this school is an example, among many, of how you don’t need to pander to the victimhood culture that too many people are earning a salary on the back of. It’s not the colour of your skin that counts, but your attitude to life and those around you.

It all goes to the schoolz’n’ospitals

Her Majesty’s Revenue & Customs haven’t been blazing a trail of efficiency of late.

Earlier in the year, it came out that the Revenue had spent over £1m on an exercise called “interventions”, which may sound like a polite version of the description that many taxpayers would attach to the tax system. In fact, it was a project where they contacted taxpayers whose returns looked slightly quirky and effectively gave them the chance to own up to mistake or omissions – sorry, that should read “help them to pay the right amount of tax”.

Unfortunately, contrary to the prevailing opinion of the Treasury, most apparently unusual features of people’s tax affairs are not cunning attempts to evade tax, but have perfectly valid explanations. For instance:

“Hello Mr Smith, we have noticed that you are only declaring £4,000 of rental income, yet your rental accounts show £8,000. Would you like to correct your return?”

“No, because I own the property jointly with my wife – haven’t you checked?”

(Pause)

“OK, that’s fine, thank you. Goodbye”.

So for a cost of over £1m, how much extra tax was raised? Err, £664,000.

Better than that, perhaps, is Mark Prisk’s discovery this week that the Revenue have spent over £500,000 in pursuing a landmark case against a husband and wife who had the audacity to want to legally reduce their tax bill. How much did the Jones’s want to cut their liability? £7,000. Hardly Liberia’s deficit, but it was the principle – and the Revenue lost.

Now the Revenue would argue that it was a test case and the tax at risk was far higher than that “owed” by the Jones’. Yet the irony is that, predictably, following the defeat, the Chancellor announced in the pre-Budget statement that the Treasury would now be reviewing the law to ensure that the sort of wicked tax loophole that the Jones’s indulged in (which arose from the independent taxation of husbands and wives) will be dealt with. After all, the government needs these tax revenues to pay for failed pursuits of innocent taxpayers schools and hospitals doesn’t it?

P.S. Yes, blogging has been light and will continue to be over the next couple of weeks while I catch up on some proper work.

If the US had failed …

Fate has ordained that the men who went to the moon to explore in peace will stay on the moon to rest in peace.

Counterfactual history – or “what if” studies – can be fascinating exercises, if a little pointless, frankly. However, sometimes they can take on a real and poignant edge – as with this speech that Nixon had prepared in the event of Neil Armstrong and Buzz Aldrin being stranded on the Moon. From this distance (in both time and space) it is easy now to forget just what a feat the moon landings were and how close the astronauts were at all times to danger and tragic failure – as more recent accidents on more mundane trips have shown.

Now, what effect would it have had on the Cold War had the USSR actually won the race to the Moon…?

And you thought Eurovision was only an annual event

Croydonian has picked up on an instance of a bunch of Balkan states voting one of their number onto the Security Council of the UN.

So here’s an interesting comparison: voting in Eurovision and at the UN. One involves an unashamed display of national herd behaviour and back-scratching in a vote on something of falsely inflated importance (though which we still have to pay for regardless) but which has virtually no weight or significance in the outside world.

The other is an international song contest.

(Boom boom.)

It’s Not My Fault

It’s Society’s fault that I have just scoffed this jammy dodger with my cuppa, and may supplement it with a Ginsters’ pasty from the corner shop when I take the dog out shortly.

In a way, though, the report’s findings – that many obese people cannot help themselves – are correct, but maybe not for the reasons it states.

If you accept that the state should take on the responsibility of your healthcare, then too many people will interpret that as relieving them of the responsibility for the condition of their own health. It also gives justification for government to take an unnatural interest in what we do with our own bodies and in our own private lives.

PieSo, should we be looking at more radical means of how we pay for state healthcare? Should the “premium” that we are charged for state health cover more closely reflect how well we look after ourselves, as private medical cover does?

Of course, some would criticise such moves as health fascism and more stealth taxation, but that is more a reflection of how abused and ineffective the system has been to date … and the fact that no genuine opt-out exists for non-emergency medical treatment on the state. Sure you can go private, but without a genuine opt-out for non-emergency treatment you just end up paying twice for your healthcare.

Moving on from what was developing into a dangerous line of thought for a loyal Conservative … one problem with reports like today’s is that it does make things even more difficult for the minority who do genuinely have a medical reason for their obesity.

Anyway, Society is now forcing me to think about lunch. Or is it all the fault of the evil Maggie Thatch? Or BushHitler? Now I’m losing track.

So, Farewell Ming

Ming has gone. Indeed, gone such that no-one has seen him since the deed was done last night. At least we Conservatives still see IDS around and about. I suppose we will now be treated to some plodding media coverage of the leadership battle between the titans of Chris Huhne and Nick Clegg as they struggle for control of the levers of power and …..

Sorry. Nodded off there for a bit.

Let’s analyse the state of the LibDems: should they lurch to the left to go for the softer target of Labour, or carry on the increasingly tougher option of winning over Tory voters (or rather, stopping the leeching of votes back to the Conservatives). Either way, for a normal political party, the sheer forces would be fatal, but this the LibDems, and political principles are some way down the agenda below acting as a de facto “none of the above” on the ballot paper.

As in 2005, the Lib Dem may see better results where they can present an alternative to Labour. In fact, as in every election since who cares when, they will simply be a dustbin for the votes of every voter disaffected with the government of the day but who can’t bring themselves to vote for the real opposition (that’s the Official opposition – the ones who actually are shadow ministers, secretaries of state, etc.).

Libs will no doubt still be deluding themselves with their 2005 result, yet they must realise that as the drawdown of troops from Iraq continues, and with Blair off the stage, the problems of Mesopotamia will drop down voters’ priority lists. Thus the only serious trick that the Libs ever had to play in recent times will soon be worthless.

And so they will return to the comfort of the familiar – whining about a lack of airtime and wishing for the chance when they might get to fiddle the electoral system in their favour (so that they go from being a minority party to being, errrm, a minority party with a minister or two).

I guess this is my last chance to use that photo again.

Ming contemplates

Lib Dem Leadership Contest – It’s a Two Horse Race

So the knives are out for Ming – as if they were ever put away for long. The latest ICM poll has shown a slight improvement, though, with the Libs bouncing back to 14% from the 11%-ish that have been rating recently. This means that, according to Electoral Calculus, the Lib Dems will win two seats in a General Election.

Sadly, neither of them are Ming’s. Instead, the leadership of the Lib Dem parliamentary party will be a showdown between Charlie Kennedy (Ross, Skye and Lochaber) and John Thurso (Caithness, Sutherland and Easter Ross). It is, as the Libs might say, a two horse race.

The PBR unravels

Invariably, rushed law is bad law, and so it has been with the changes to Capital Gains Tax. A reaction to those bogey-men du jour, private equity firms, it seems that many of those who will be hit by the new 18% CGT rate will be those callous exploiters of the workers – errr, workers who hold shares under Save as You Earn and other Employee Share Schemes. Nice one Darling. Indeed, it seems Lord Digby Jones warned the Treasury of this before the Pre-Budget Report (according to Channel 4). Lord Jones might now be noticing that that itching sensation might be something to do with the dogs he’s laying down with.

And let’s not forget those who have run their own businesses for years in anticipation of their retirement, and will see the tax on the sale of their business (which may constitute their primary pension investment) double or worse (retirement relief already having been abolished a few year’s back).

An interesting side-effect of the changes, which take effect from 6th April next year, is that many small businesses, which aren’t already incorporated, will now rush to do so before the 6th April next year, to crystallise any capital gain they have and so take advantage of the old reliefs while they still can. And, just like the years following the introduction of the 0% corporation tax rate (now abolished), the sudden increase in company formations will be hailed as an increase in business start-ups and used to rebut suggestions of an economic slowdown. Don’t believe the hype.

Much has already been said about the con of the £600,000 inheritance tax threshold which is nothing of the sort. With a little tax planning, most couples could take advantage of the first-death threshold anyway. Darling’s announcement simply makes the process a little more straightforward – but hardly justifying the headlines of Tuesday afternoon.

And what of independent taxation of husbands and wives, introduced and welcomed under the last Conservative government? The IHT change would look, to the layman, as recognition of the advantages that independent taxation brings – with one spouse being able to transfer their other halves’ allowance. In other news, a victory was scored in the High Court recently (the “Arctic Systems case”, Jones vs Garnett) when a married couple successfully defended themselves against attempts by the Revenue to stop them splitting the husband’s income 50/50 in order to use her allowances to reduce their overall tax bill.

But principles mean nothing to the government, and Darling announced on Tuesday that the Treasury is looking at ways to subvert the High Court judgement and come down hard yet again on small businesses.

As with the main budget, the media spotlight moves on after 24 hours, but those affected may not appreciate the full negative effects until another year or more, and so the drip effect will continue. Right up until 2009.

If you’re really keen, you could peruse the analysis and discussions on AccountingWeb .

And so it was …

In the continuing saga of Brown’s difficult second album, his co-writer Alistair Darling has produced a clutch of “new” tracks that turn out to be a bunch of cover versions for which he didn’t even ask permission to use, and which have clearly been produced in something of a rush, and it shows.

I’ll probably blog some more later on the PBR, but for now I have real work to do….

Darling To Play Catch-up

So Alistair Darling may signal changes to Inheritance Tax in the Pre-Budget Report this afternoon.

I wonder where he got that idea from?

For George Osborne this should be a win-win. If Darling raises the threshold further, or drops the rate, then it will surely make our proposals cheaper, thus enabling the revenue from the non-dom levy to be spread a little further in other tax cuts. And of course, with the media rather more sceptical of the Brown government than they were eight days ago, the attempted “shooting of the tory fox” will be shown up as an opportunist and desperate reaction to our own proposals.

Sadly, I will not be able to watch the speech as I’ll be partaking of the pleasure of a VAT update seminar. How will I contain the excitement?