tag:blogger.com,1999:blog-1835455773953043846.post5927825814122981319..comments2024-01-12T18:59:05.080+00:00Comments on Defence With A "C": Scratching for taxesUnknownnoreply@blogger.comBlogger8125tag:blogger.com,1999:blog-1835455773953043846.post-60440631368857703682013-08-16T20:35:14.951+01:002013-08-16T20:35:14.951+01:00Who believes it? Before you mention VAT, that'...Who believes it? Before you mention VAT, that's chargable on imports as well. The tax on energy is low and business rates would make just a fraction of the total cost of the project. You might optimistically add an extra 1% to the 11 above.Chrishttps://www.blogger.com/profile/18182426936194426623noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-77074844367937640242013-08-16T17:29:45.775+01:002013-08-16T17:29:45.775+01:00"
The idea that taxes are *only* paid on prof..."<br />The idea that taxes are *only* paid on profits is a myth.<br />"TrThttps://www.blogger.com/profile/07316335177828136131noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-69168334714163008172013-08-16T01:38:41.565+01:002013-08-16T01:38:41.565+01:00Taxes are paid on profits. It's called Corpora...Taxes are paid on profits. It's called Corporation Tax. Chrishttps://www.blogger.com/profile/18182426936194426623noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-61379129209990235962013-08-15T20:11:12.900+01:002013-08-15T20:11:12.900+01:00You have 20% VAT on sales right off the top
12% EN...You have 20% VAT on sales right off the top<br />12% ENI on wages<br />12% NI on wages<br />20% / 40% / 50% tax on wages<br /><br />5% VAT on electric and gas (probably reclaimable, I F-in hate VAT)<br /><br />Green Levy on gas and electric, 12% maybe, I forget.<br /><br />Business Rates<br /><br />The idea that taxes are paid on profits is a myth.<br /><br />http://www.cps.org.uk/files/reports/original/111104155223-morebangforthebuck2.pdf<br />Not taxes so much as the wider economy, but interesting none the less.TrThttps://www.blogger.com/profile/07316335177828136131noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-87366401326090265322013-08-14T19:05:41.620+01:002013-08-14T19:05:41.620+01:00Evening anon,
If it's being exported, it prob...Evening anon,<br /><br />If it's being exported, it probably doesn't need the UK to buy it as well just to keep it afloat. See Rolls-Royce and their significant (and growing) chunk of the airline engine market.<br /><br />With regards to the people employed, the proportion of those people filling unskilled, generic type posts is not likely to be overly high. There'll be admin people etc who might have to compete in the market place, but there's little chance that the more highly skilled staff who will make up a reasonable chunk of a defence companies work force are going to have to compete for jobs.<br /><br />One thing worth noting is that people like engineers often end up as entrepreneurs, designing the next latest and greatest gadgets. It's certainly a reasonable proposition that you would expect to see groups of people laid off forming partnerships/small companies, that perhaps focused on their particular areas of specialist knowledge.<br /><br />As for Newey, his skills and the resulting success that has stemmed from them have done a huge amount for keeping high quality motorsport in the UK. Without him (and the resulting success) there is a strong case to argue that British motorsport would not be at the same level that it is now, he really has been that influential.<br /><br />Also, you should remember this is not an outright argument against buying British, just that the tax recuperation argument is somewhat less than is often touted. There should be other reasons to support a UK preferred buy in cases where a foreign buy would be cheaper. <br /><br />The answer is probably more along the lines of what the Chris above is suggesting, where the UK buys certain things at home (like Nuclear subs) and shops elsewhere for others.Chrishttps://www.blogger.com/profile/18182426936194426623noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-69179461998278840642013-08-14T18:54:22.967+01:002013-08-14T18:54:22.967+01:00Thank you Christopher (and what an excellent name ...Thank you Christopher (and what an excellent name you have!),<br /><br />I don't mind if we're buying British when there are clear reasons why this is beneficial, even if it means competing against a foreign supplier. I just think the tax take argument is very lacklustre.<br /><br />In comparitive advantage terms I think we do quite well, for example with things like Hawk trainers.Chrishttps://www.blogger.com/profile/18182426936194426623noreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-17508701117878627222013-08-14T16:37:43.707+01:002013-08-14T16:37:43.707+01:00One thing you forgot to mention that there can als...One thing you forgot to mention that there can also be more tax generated (both from profits and employees) from exports of a UK produced solution. Even if the whole product isn't exported. Often at least some of the sub components will be.<br /><br />Don't really completely buy your argument that if less people were employed by defence companies then they would all or nearly all be employed by other companies. Yes the highly skilled people would most likely be employed, but it is likely that would just mean that lower skilled people currently employed somewhere in the other industries chain would not be employed.<br /><br />I don't see the evidence that the total number of people employed in other areas would suddenly increase to cover any decreases in the numbers employed in the defence companies. If there was a sudden high number of very high skilled people looking for a new job, then some companies might think that they could employ extra people and expand. While most would employ those people and cut down the number of other recruits, or even find ways to lay off existing employees. <br /><br />If Adrian Newey had taken a job with a defence company, would there be one less person employed in Formula 1? If he taken that job in defence until now and then found himself looking for a job, and got employed by one of the Formula 1 companies. Would they have created a new extra position for him, or would it have meant that someone else didn't get employed. Maybe just that they didn't take on one new university graduate. However what if that new university graduate would have been a even better designer in the years to come?<br /><br />I have no actual figures to base this one, but I would think that if a company laid off say 1000 employees. Quite a number of them highly skilled but in no way all of them. Then maybe 5-10% would get absorbed into other industries, without any other job losses or less people employed. Then I would think there is a good chance another 10-15% would take jobs in a different country. So while they wouldn't be claiming benefits or anything, they also wouldn't be paying taxes in this country.<br />Another 40-50% might get employed in other areas, but they would mean that either someone else didn't get employed for those jobs, or maybe the companies cut down the number of graduates/new trainees that they employed. 5% might decide to retire early.<br /><br />However I do agree that if one of the aims of the MOD is to create or keep jobs, then it should benefit from doing that. If the MOD job is defence, then its task should be to get the best equipment for the forces. However there is the issue of having the ability to design and produce weapons in this country, which is really a big part of defence. If we bought everything from other countries, then in a major war, we could be in serious trouble. You could argue that a major war isn't likely.<br /><br />Personally I'm in favour of buying domestically whenever possible. If a foreign item is a lot cheaper or better, and not having it designed or produced in this country isn't a big issue, then go with the foreign one. But most other times, go with the domestic one. However the MOD should benefit from some of those taxes that are recovered. <br />Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-1835455773953043846.post-79972337847127385682013-08-14T16:35:58.189+01:002013-08-14T16:35:58.189+01:00I think it also comes into the realm of specalisat...I think it also comes into the realm of specalisation aswell, if we can focus on one section of defence industry and produce that well, and get export contracts for that, now the UK industry is potentially big enough to have multiple specalisations, but there is the risk of competeing against firms in other countries that can produce what we can better and cheaper, overall its a complicated issue, and I found this article really good at talking about it!Anonymoushttps://www.blogger.com/profile/12769764688899028032noreply@blogger.com