About Me

"Setting the world to rights"...one blog at a time! Plus anything else that comes to mind

Monday, 29 March 2010

8 Our national health

So, what exactly should our taxes cover? A whole lot more than I can come up with I suspect, but there are some obvious ones; as well as some I feel we should NOT have to pay.

Let’s start with health since I’m proposing to highjack the National Insurance system!

Very broadly … vaccinations against certain diseases and facilities for dealing with epidemics, for example, are essential. Hip replacements and diabetic treatments keep individuals active and contributing – this sort of thing keeps society running. However, services like fertility treatment benefit only the individuals concerned, not society. There are also the knock-on effects of non-essential services. For example, the chances of the children born through fertility treatment needing more healthcare than the average child are higher, possibly even taking either or both parents out of the job pool to care for them. Certainly, at this time, society can’t afford this.

It’s harsh, no doubt about it but remember – a fair taxation system combined with sensible public expenditure should leave us with sufficient in our pockets to pay for what is most important in our lives. If what is important is having children then we can use the money in our pockets to pay for treatment privately.

Now look at the name, The NATIONAL Health Service, not the Local Health Service. Everyone pays into it and should have the same opportunity to use its services. The sufferer of a particular disease in the North West should expect the same service as a sufferer of the same disease in the South East. Allocating budgets here seems daft. Consider; perhaps each area is allocated a certain amount of money per resident to cover prosthetics. However, there are more chances of accidents requiring prosthetics in manufacturing towns than there are in the City of Westminster, say. Each area has different risks associated with it, if something needs doing, it should be done.

Budgets create demarcation lines, borders. Someone could live 5 miles from a hospital but it’s 2 miles over the area health authority border so they have to travel 20 miles in the opposite direction for treatment. Daft!

Our hospitals and health centres have become larger and larger over the years. We don’t need duplicate facilities every fifty miles or so for rare or specialist treatments but we do need local facilities for more general needs, simple broken bones, diagnostic procedures and so on, then send patients diagnosed as needing treatment to a specialist facility. Afterwards patients could be transported back to a local hospital to recover near family and friends. Or perhaps bring back the convalescent homes that used to provide interim care before patients returned to their lives. Also, larger facilities mean more people at risk if there’s an outbreak of something contagious. During times of plague in history, were not people discouraged from large congregations to try and prevent spread of the disease?

There’s more to this subject alone than I can cover in a small blog…but it’s a start.

Sunday, 14 March 2010

7 Human Rights issue

Before we move into what our taxes should be used for, let’s address the Human Rights issue as this will affect how we decide what society should pay for. I suspect there are as many views on what human rights consist of as there are human beings on this planet. Folk tend to look at what THEY want and need when deciding what human rights are. Understandable!

In my view the only rights any individual has are those that society is not only WILLING to let them have, but is also ABLE to let them have.

In a small society, tribe perhaps, too many healers would leave people sitting around contributing nothing when everyone was well. This would put an unfair burden on, say, the hunters who had to provide meat for more people than necessary. On the other hand, too few healers could be catastrophic if a major disaster happened. Presumably they worked out a viable balance and I’m sure most members of small societies or tribes had more than one skill. I’m also sure they had many a young man who wanted to be a healer but had to be a hunter. The tribe may be WILLING to let him be a healer, but they may not be ABLE to do so because it would unbalance the tribe and possibly lead to eventual starvation and extinction of the whole society.

Bigger societies have a lot more leeway but how do we find the balance between what our society is not only WILLING to do but is also ABLE to do? Not exactly a straightforward issue. I’m sure we would all like to think we could make the very best of everything available to everyone at all times but even I know this is an impossible dream. Basically what society needs are the facilities to keep most people fit for work most of the time and to have reasonable preparations in place for emergencies. Anything that can be managed over and above that is to be welcomed as a bonus.

If we manage to develop a reasonable system of taxation there should be enough money in the hands of the general population to enable them to get what THEY consider to be their human rights. BASIC Human Rights can then be considered in terms of the right not to be harmed in any way instead of the right to have things.

6 One tax - can it work?

Well, we have a system in place that could be adapted and scrap everything else. National Insurance is already used to claim a fixed percentage from both businesses and individuals. Since I consider the health of the nation to be part of the responsibilities of society as a whole I don’t see why it has to be a separate claim on our pockets. The money goes into one big pot and is paid out on a need-to-be-done basis.

We all have individual National Insurance numbers. Use a P (Personal) prefix for an individual and an N (Non-personal) prefix for business, charities etc and X for everything else, eg foreign residents earning money in the UK. Banks and building society interest, stocks and shares sales – all can have tax taken before payout and passed to the government by the bank, building society, stockbroker etc; employment income, including basic salary and bonuses – tax can be taken and submitted to the Government by the employers; house sales – tax on the balance between original purchase price and sale price can be taken and submitted to the government by the solicitors. All accounts and transactions must have allocated ‘N.I.’ numbers and this number must be quoted by the payer to the Government for recording by the Tax Office.

Anyone submitting a tax return simply lists all income for the year and how much tax they’ve paid at source and submits payment for what has not already been paid. The figure already paid is compared to what is recorded under the ‘N.I.’ number and the new payment recorded. There’s no working out what tax band applies, no fiddling to bring the amount down to the lowest possible tax band – one percentage for everyone. Tax inspectors should find their work easier when investigating suspect returns and carrying out random checks.

The more tax is taken ‘at source’ the less chance for individuals to ‘fiddle’. One percentage means sources don’t need to know whether their employees pay a particular rate or are eligible for certain subsidies in order to calculate what they should pay; one percentage fits all, leaves no room for argument or misinterpretation and is easy to change annually when the ‘Budget’ is decided.

What percentage? I’ve no idea; one of those things better minds than mine would need to work out!

Oh, and in case anyone is wondering, no – if you make a loss instead of a profit you don’t get tax handed back. Tough!

I’d like to re-iterate here that income tax should be the only tax. If we need money to keep us going, we all contribute. Keep it separate from anything else so we always know where we stand.

If social engineering is required e.g. a company violates regulations and causes an environmental disaster, the company is prosecuted and not only has to pay to put the problem right but also has to pay a ‘social penalty’. Remedial work and penalties should both be paid from their profits i.e. after they have paid their income tax – which is a separate issue.

Policing and administration of prosecutions should be covered from the ‘N.I.’ pot as this comes under law-enforcement but the social penalty should be paid to a separate fund. That fund to be kept in case any firm does something so awful that it goes out of business without being able to pay for correcting the problem and does not have insurance to cover it.

As another example, if it was decided that a penalty on petrol use was needed as social engineering the money should also go the Penalty Pot. As petrol is so damaging, perhaps the pot could also be used to fund research into alternative fuel sources.

Saturday, 13 March 2010

5 Tax changes - an idea?

One fixed percentage of all income seems the fairest. Higher earners may pay more in actual money but are still only being inconvenienced at the same rate as the lower earners, yet are reaping rewards for their work by a better standard of living than others, and inclusion in our society. However, there’s no reason why those at the lower end of the pay scale shouldn’t be inconvenienced to the same extent; they will also be benefiting from society and it gives a feeling of inclusion and shared responsibility, of ‘doing my part’. So it’s fair.

Let’s spell this out. I mean every individual, company, institution, charity etc pays a specified percentage of income from whatever source. No exceptions whatsoever.

What are the benefits of one tax only? ...how long have you got?!

First and foremost is that whole fairness issue. It’s fair, and we know everyone else is in the same boat, so we can see it’s fair. It’s simple…if you earn it, you pay it. If there’s not enough money in the pot, the percentage is adjusted up accordingly, and if - dare I say it? - there’s too much, the percentage can go down! .

No teams of accountants/lawyers/politicians sitting down – and being paid - to work out the pros and cons of increasing/decreasing various sources and the possible side-effects. No complicated Budgets that have to be explained and then complained about/apologised for when they turn out to have an unreasonable burden on a particular section, or sections, of society.

Whole departments in the Tax Office can be dispensed with. There would little need for most of these people to lose their jobs in the short term. They could be re-trained in administrative roles and transferred to immigration. By the time they’ve reduced the lists there should have been enough natural wastage not to cause too many redundancies. In the long run the cost of their salaries and pensions would be vastly reduced and we would lose the cost of the buildings etc, relieving the tax burden on society even further.

Businesses wouldn’t have to employ large numbers of people to interpret and implement the Tax Laws. The self-employed wouldn’t have to pay Accountants to work out their tax liability. The employed wouldn’t feel frustrated at having to pay full whack for e.g. a wardrobe, that a self-employed person can get tax relief on by asking the sales-assistant to describe it as a ‘cabinet’ on the invoice! Everyone would spend less energy looking for ways to reduce how much tax they pay and spend more time and money investing in their business and resources.

As businesses invest and grow, they will expand and employ more people, who can afford to buy whatever society produces and the country prospers. Likewise, new businesses can concentrate on getting off the ground instead of paperwork.

The ordinary Joe-on-the-Street has tax deducted from his wages by his employer before he even gets the money in his hand. He then has to live on what’s left, providing food, shelter, heating, caring for dependents etc. Companies and the self-employed can deduct their raw materials (food), premises (shelter), heating, paying employees (dependents) from their income before they are taxed! Why can’t Joe pay for his living expenses before he has to start paying tax? No…it still leaves the whole question of what is a valid tax deduction and what isn’t. Surely it’s better for companies and the self-employed and the employed to pay their taxes based on their income?

It also seems to me that the simpler a system is the harder it must be to find loopholes or ‘work’ (‘fiddle’?) the system.

Why should any one section of society be exempt from paying tax? For example, charities and religious bodies can be tax free. What a can of worms! Firstly there’s the question of what is a ‘valid’ charity or religion? I’m sure there are lots of different views on this! Then there’s the question of who’s going to make up the shortfall? If a charity invests money in a savings account, that money is effectively taken out of the economy for taxation purposes. Those who don’t agree that a particular cause is worthy, end up having to contribute by default because more tax has to be paid by everyone else to make up for that cause’s tax-relief benefits.

Society’s infrastructure has to be paid for regardless of who pays. If one section doesn’t pay then everyone else has to make up the shortfall. How is that fair?

Taxes are to cover transport, communication, education, defence and so on. Whether we are old, or young, married or single, a private individual or a business, charity or church, we all benefit from these things and no one person or organisation should be exempt.

Is one tax for all Impossible? Is it Impractical? Maybe! But let’s explore it as a starting point and build up a workable solution.

4 Taxation - do we need it and is it currently fair?

Money governs every aspect of society; taxation is the tool we use to raise money. Do we have to have taxation? Yes, of course we do. There are certain areas of our society that we have responsibility for as a group if we want to survive; transport, communication, education, defence and so on. Our way of getting these things done is by payment. Everyone pays something towards the pot to keep our infrastructure in place - taxation.

Understanding that we have to have taxes, now we have to work out a fair system of collection. I think our system has become complicated over time as society has evolved. There are numerous taxes, direct, indirect and hidden, and it seems to me that whatever way you look at it, some unfortunate section of society ends up paying more than the rest. If it’s not fair it will generate ill-feeling, resentment and eventually, social disorder.

My thought is that it’s only fair if it’s seen to be fair and it can only be seen to be fair if it’s simple.

• Is it currently fair? Not to my mind. Is it fair that someone living in one part of the country should receive benefits that someone elsewhere in the country isn’t, when they are paying taxes for the same services? Of course not!

• Can it currently be seen to be fair? Again, not to my mind. Some people are eligible for tax relief, others aren’t. Can we see who these people are, why they are eligible for relief and be sure we’re not paying more than our share? No!

• Is it simple? Guess what – not to my mind!

So, what do I think would be fair? Well, put at its very basic, purely from a fairness point of view and accepting that nothing in this life is completely fair for everyone I would say…

…we should pay on the basis that we are all inconvenienced to the same degree.

Paying a set amount is clearly not fair. £10 a week, for example, out of the pocket of a pensioner could be life threatening if it meant they couldn’t eat or keep warm. £10 a week out of the pocket of a millionaire simply wouldn’t be noticed.

But is paying according to a scale – a higher percentage the more you earn, or paying nothing if you’re earning at the bottom of the pay-scale - any fairer? High earners lose 40% of their income. Not as life threatening as £10 for the pensioner but what incentive is there to stay in the UK and keep contributing? What incentive to work harder if the more you earn the higher the rate of tax? On the other hand, what incentive to work at all if someone else will pay for you?

3 So, what's it all about?

Basically, these blogs are about standing back and looking at society as a whole, considering whether we need to re-structure because the old one has become too complicated and rickety and is liable to fall about our ears because the repairs need repairs.

Friday, 12 March 2010

2 Where do we fit in?

Before going further I think it’s important to understand ‘society’ and our individual role in it. To my mind - bottom line - it’s a group of like-minded people living together, working towards survival.

Every single one of us, from Lands End to John O’Groats, from western Ireland to East Anglia, from the inner cities to the remotest farm belongs to this society, benefits from this society and therefore has responsibilities to this society. In order for a society to work the members of that society have to agree to co-operate according to agreed common rules and we have to accept that we all have to do our part. We seem to have lost this sense of cohesion and responsibility. We all need to change our attitude!

It’s no use saying, for example, “I don’t have children, why should I pay for education?” If society’s children don’t get educated they won’t be able to contribute their bit towards society when they grow up; there won’t be doctors and nurses to treat us, no bus drivers to take us to the hospitals, no farmers to grow the food we need to eat to keep us healthy…

…nor is it any use saying “I don’t drive/don’t use the roads on the other side of the country, why should I pay for their upkeep?” The city worker relies on the transport system to bring food from the country grown by the farmers. The farmer relies on the city workers to buy his produce to give him a living so he can in turn buy their goods and services…

…it’s certainly no use saying “I can’t work because there’re no jobs that interest me”. While a large enough society can afford to look after some members who are, through no fault of their own, either temporarily or permanently unable to contribute, even a large society will eventually fail if the proportion of non-contributors to contributors is too high.

Whoops, the battery's low, the next blog will have to wait for another time.

1 Getting started

These blogs are deliberately anonymous. The main reason being I feel it’s important not to be able to read this and say ‘oh, well, he/she only says that because he/she’s a black/white, old/young man/woman; what did you expect?’, and then dismiss the ideas completely.

I’m not trying to say my views are the only right ones or that my solutions are the only valid ones. Indeed I suspect that many, if not most, are na├»ve, idealistic, impractical and unintentionally insulting to at least a few people out there - since it’s hard to say anything without upsetting someone. Not to mention they are based on ‘what everyone knows’ and I can’t have all the facts right.

However, I don’t see the possibility of making a fool of myself as any reason not to contribute in some way to sorting out the mess we seem to have got ourselves into as a country. It’s possible that at least a small portion is worth taking forward, or that the odd idea may trigger better ideas in more capable people.

I don’t propose riots, or uprisings, or the toppling of governments. No, I’m thinking the sheer size of population in this country must mean that somewhere there are good, practical, knowledgeable people with or without qualifications, who can come up with ideas to resolve our problems without thought of personal gain but with the will-power and resources to follow through. In other words, if we as a society don’t like the mess we are in, it is up to us as a society to propose some solutions to our government instead of simply berating them because they can’t work it out by themselves.