It’s that time again – post budget and pre-end of tax year – we’re being bombarded with messages about saving in ISAs. It’s a good thing that it’s there to do tax free, etc., but it suddenly feels like a lot of pressure. In the past I’ve never really paid much attention to it, but this year we could indeed lump all our savings in that direction.
I’ve been thinking of putting money into some funds that give a high return, but couldn’t be described as being environmentally friendly (natural resources) or ethically sound (China), but would produce a good return where I could then decide what I do with the profits.
Up until recently it was a bit of an academic point, but with the approach of the ISA tax-free deadline I have to decide what to do. I’m probably going to wimp out and keep the money in the bank – staying liquid and giving myself the option to buy a car instead. It’s all about long-term gain vs short-term benefit and for the moment I don’t feel like being particularly high-minded.
Brown’s budget this week didn’t set a particularly good example. He’s made the tax system more complicated than ever and made it easy for his political enemies to make accusations that it’s only about winning votes. Unfortunately it was a lost opportunity to win more people around – the people who are likely to switch from Labour to the Conservatives when he’s Prime Minister.
So, what would I have done if I was Chancellor? Well, that’s a question I’ll answer over the next few days. I’m going to start off by suggesting that we have a flat rate of tax – a particularly easy one to suggest, but one that I think would kick start our economy in a massive way, so:
1. Flat rate of tax
20% for everything – all income tax, corporate tax and inheritance tax
Let the government play with the allowance levels, not the rates. That makes it easier for all of us.
More to come . . .