Stealth Taxes in the UK

Millions of people in the UK will be hit by the tax changes that will come into effect from this month April 2010.

These increases were set up some time ago so nearly all of them will have been forgotten by the ordinary working man.This, of course, is why they are often known as stealth taxes.

They get introduced a year in advance of when they actually come into effect. So when they first announced people tend to ignore them as at that time they have no actual impact.

This has been a feature of Gordon Brown's Chancellorship from his first budget way back in 1997 and is continuing with the current Chancellor Alistair Darling.Darling in his last years budget.

Gordon Brown is the finacial genuis wholost the UK more than £13 Billion selling the Gold reserves at some US$ 220 an ounce compared to nearly US $ 2,000 at its peak.

For example last year he announced that fuel duty would rise by 1p a litre in real terms between 2010 to 2013 and that means 1p plus inflation as measured by the retail price index.

This will come into effect on aptly 1st April 2010 (April fools day). The increase will be geared to the projected inflation figure for the third quarter of this year which will be released with the budget on 24th March and some thing in the order of 3p a litre is anticipated. However in the budget on 24th March 2010 he said that the increase would be spread over the year. That is one third on April 1st and one third in October and one third in January 2010.

In his 2008 budget Darling also introduced a one off tax increase in Vehicle Excise Duty (VED) on all new cars that are registered after 1st April 2010 (again April fools day) this tax is commonly referred to as "Showroom Tax". Like all Stealth taxes this has not been picked up much by the press and many car dealers report that clients are generally unaware of it.

The way that this works is that people buying a new car with the 10 number plate will face quite a significant tax increase which could amount to £1,000 in some cases.Some examples of the show room tax are:Audi A4 £125 BMW 5 Series £550 Mazda R8 £950The purpose of the tax is to apply a higher tax to high emission vehicles with a higher initial rate of VED in the first year.

However thousands of ordinary working class people with medium sized cars will also be hit with a tax amounting to hundreds of pounds.For example somebody buying a Honda 2.0 IVTEC which falls in band J will be hit with a first year duty of £425 compared with the current cost of £215.Then we have stealth taxes on ordinary peoples pensions.

From April 6th 2010 the Government will dramatically reduce the pension benefits for millions of workers in what is being called yet a further stealth raid on peoples retirement funds. There are more than 6 million people who earn more than £31,800 per annum who are building a smaller state second pension. This is known as a S2P and it is designed to provide a top up to the basic state pension and was previously called serps.

The government have frozen the higher earnings limit for eligibility for the S2P at £40,040 last April and previously it had increased year on year ,as you expect it to, and at the same time the rate at which S2P will build up halves from 20% to 10% above £31,800.It has been widely reported that the revenue generated by stealth taxes and by allowances and tax thresholds which are frozen, with no inflation linked increases (as one would naturally of course expect) are increasing dramatically.

Stealth Taxes have actually increased from £69 billion in 1997 when Gordon Brown became the UK Chancellor to a staggering £125 billion in 2010 an increase of nearly 80%.

Gordon Brown's government slogan is "A future fair for all" .

Many people think that he is talking about a fun fair. To b stampe frank what he knows about being fair could be printed on a postage stamp.

He has harmed pensions by making it such that they could not relaim the advance corporation tax on their income. At a stroke he reduced their income and limited the future growth of ordinary working peoples pensions dramitically. The losses are estimated to be in excess of £350 billion and clearly his decision has taken more money from pensions than the late Robert Maxwell ever did. The reason for this is that pensions grow by reinvesting their income so as to get compound growth on their funds. Brown struck his less than prudent tax cut in 1997 so his negative effect has been in force for 13 years. But not only as he made the income much less than it should be the effect of less incopme in the pension finds meant that the stock martket did not grow as fast as could.

Recently he has admitted that the figures he gave before the Chilcott enquiry were incorrect and the statistics he provided on immigration recently were severly incorrect.

With ever increasing taxes it is even more imortant that you cheack that you are not due a refund under the PAYE system.

To increase your wealth in a tax free way  you should consider learning about spread betting. This allows you to trade the stock markets and it is completely tax free, Something to think about.

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