Which universe was this phoned in from?

Fourth, some shibboleths need to be faced. Grenfell Tower is already symbolic, but it also represents a reality in UK housing policy. This now subsidises private landlords and not tenants. It is biased towards home owners and not those who aspire to a secure home for their families. It promotes the myth of property as wealth, and not as homes. It does, therefore, divide society. The best indictation of change will, then, be the willingness of people to not only become involved but to also demand that these divisions be removed. So the question is whether or not politics can move from being about reinforcing the power of particular interest groups to an alternative based upon the promotion of broader communal values.

There will be very obvious indicators that will suggest if this is happening. So, for example, will funding for social housing be made available?

A tenant managed block of council flats went up in flames. After said council had spent £70,000 per flat tarting it up. Within a fortnight a local council (The City Corporation) had bought replacement flats in the locality to offer, as social or council flats, to all those displaced.

This shows subsidy to private landlords, does it?

55 comments on “Which universe was this phoned in from?

  1. I see his ‘university’ has been awarded a silver in the teaching standards. Can’t see it getting any better whilst he still is a 0.2 Prof.

  2. I’ve just spent a couple of minutes checking my understanding of shibboleth and like wat I’m at a loss to understand what he’s getting at. He’s obviously seen or heard the word used and think using it himself makes him look learned.

  3. I visit quite a few personal finance blogs. Several writers bang on endlessly about rents, house prices, and whatnot but always, I regret to say, unintelligently. Not one that I’ve seen grasps the key point that it is no business of the government whether we live in owner-occupied housing or as tenants. It follows that the taxation of the two should be equalised. In other words, CGT should apply to o-o housing, and the imputed rent on o-o housing should be subject to income tax (as it was before 1963).

  4. @dearieme…

    What great ideas!

    CGT on owner-occupied housing… Bring the housing market to an abrupt halt or massively increase personal debt in the form of mortgages necessary to compensate for the taxation element of a sale if you want to move house.

    Imputed rent on o-o housing… Assuming that you’re implying that I, as an o-o, should be charged income tax on the notional rent that I could have paid myself for the privilege of living in the house that I paid for out of taxed income… Fuck off!

    You’re not Spud’s aler ego are you?

  5. It promotes the myth of property as wealth, and not as homes.

    Some myth.

    The day that a property ceases to represent wealth to whomsoever owns it will be the day before it becomes unfit for habitation as a home.

  6. “the imputed rent on o-o housing should be subject to income tax”

    Likewise driving a personal car should be subject to imputed taxi fares and banging your wife should suffer imputed whore-tariffs.

    Makes perfect sense. Anything and everything you do privately should suffer imputed income tax as if you were receiving the same as a service.

    It’d make blokes think twice about a crafty J Arthur in the shower.

  7. I’d be happy for CGT on o-o housing and rental properties to be equalised, also stamp duty, at the same optimal level of zero.
    Would also be happy if council tax treatment was equalised – for HMOs it’s an allowable expense on the LL’s tax return. No such luck for an owner occupier.

  8. On reflection: the City of London is supplying ace new housing to ex-Grenfell tenants. Have they thought through the incentives they are are putting in place for tenants in other tower blocks?

  9. “The Meissen Bison

    ‘It promotes the myth of property as wealth, and not as homes.’

    Some myth.”

    Indeed. Having no-one of note to leave any money to when I die, I’m looking forward to equity-releasing my house as part of my retirement plans.

    I’ll enjoy spending the mythical money.

    I guess Spud is just pee’d off that his own home ownership wealth plans haven’t gone well.

  10. “the City of London is supplying ace new housing to ex-Grenfell tenants”

    I do understand the call for those who have been made homeless in the Grenfall fire to be re-housed in their local neighbourhood.

    Anyone know how much rents are in Addis Ababa and Mogadishu?

  11. Imputed rent taxed as income is a thing in Switzerland. However, mortgage interest payments are likewise tax deductable.

    It’s a strange way to try to reduce the financial “privilege” of o-o vs rental, but that’s how it is.

  12. > £70k would have bought them a small house outright a bit further north.

    This. But we have a strange rule that says that because a Syrian refugee mysteriously finds himself in Kensington, rather than in Teeside, we must accommodate him in Kensington. And send him to university nearby. All at taxpayer expense.

  13. > some shibboleths need to be faced

    shibboleth (n): a common or longstanding belief, custom, or catchphrase associated with a particular group, especially one with little current meaning or truth.

    Seems pretty clear to me. I’d have used “challenged” rather than “faced”, but otherwise it’s fine.

  14. “Grenfell Tower is already symbolic, but it also represents a reality in UK housing policy. This now subsidises private landlords and not tenants.”

    Eh? I’m sorry, but after nearly a decade working in the housing sector, I never noticed how the sub-market-price social rents, with their all-inclusive repairs and emergency plumbing service and planned cyclical bathrooms, kitchens, windows and door replacement service was somehow paying cash directly to private landlords.

    I did know of many private landlords who struggled to rent properties in the same blocks as social tenants, as we undercut their rents (and stuck shitty occupants in), though.

    The man is a baboon

  15. Andrew M, I thought that when I look d it up, but don’t you need to say to which group the shibboleth belongs for it to make sense?

    Like if someone said “we need to challenge this dogma that…..” you’d be asking “whose dogma?”

  16. “However, mortgage interest payments are likewise tax deductable.” That would be right if the same thing applies to a let house. Hell, it applied in Britain until a few decades ago.

    “Would also be happy if council tax treatment was equalised – for HMOs it’s an allowable expense on the LL’s tax return. No such luck for an owner occupier.” That would have to be considered too because the point is to equalise treatment.

    “CGT on owner-occupied housing… Bring the housing market to an abrupt halt”: only if you introduce the tax in an abrupt way. I notice that you don’t rise to the intellectual challenge of explaining why an o-o house should be exempt from the tax that a let house is subject to.

    “Fuck off!” Thank you for illustrating my point that unintelligence is such an outstanding characteristic of this field.

  17. If you are going to do imputed rent, one could argue imputed interest instead (on the equivalent capital sum invested). Ie capital in the bank, interest earned, rent paid. That the equivalent person renting.

    For the individual concerned, rent paid is not tax allowable, interest earned is taxed.

    And no, obviously it’s not a good idea in any case, as others have pointed out re cars, hookers, or any other assets one ever buys and uses (caravans, planes, boats?). The principle is basically one of the state controlling everything one does.

  18. Dongguan John,

    > but don’t you need to say to which group the shibboleth belongs?

    I substitute “common misconceptions” for “shibboleth”. That means the implied group is most people, the masses.

    The shibboleths themselves are also implied, not stated. He lets readers fill the gap with their own prejudices. This is why his writing makes perfect sense to those on the Left, while remaining impenetrable to those on the Right.

    I agree with Bloke in North Dorset’s assesment:

    He’s obviously seen or heard the word used and thinks using it himself makes him look learned.

  19. PF,

    “If it flies, floats, or fucks, rent it.”

    If I calculate the imputed rent on my wife, the government would owe me a pretty big tax rebate.

  20. This is why the theory of multiverses gets so much mileage.

    If he was a lone kitchen typist one could understand – but he’s uncritically quoted mainly by the “left” afaics . To what’s left of my mind that makes those quoters worse than the original source of mental flatulence.

    In this context the useage of “shibboleth” must be compared to “Tax Justice” and the rest of the self aggrandising pomposity that emanates from him and his fans.

  21. If it’s imputed rent, rather than imputed interest, then it’s not equalising with the person who pays rent, it’s basically the state saying we want the tax as if every properly was let.

    I am not sure why any non collectivist would argue for that?

    Flies, floats or fucks – indeed..:)

  22. “you don’t rise to the intellectual challenge of explaining why an o-o house should be exempt from the tax that a let house is subject to.”

    A let house earns its owner profits. It is a business asset.

    An owner occupied house does not earn its owner profits. It is not a business asset.

    Of course, the State could choose to tax everything. Some people wish it did. But the above works for me as a reason to differentiate the two situations.

    It wasn’t an intellectual challenge.

    That would be

    “Chap in his 70s has lots of money (say £2.5m) and is told he has only 6 months to live. His wife is dead. He has one married daughter, no sons. No grandchildren. He hasn’t done any IHT planning. He wants to minimise or eliminate IHT so his daughter and son-in-law can do all the things he wished he’d done with the money. What advice can you give him?”

  23. @Jack C – Since it’s not licenced gambling, it would be an unenforceable debt and so not deductible from his estate.

  24. Charging imputed rent would get complicated though, wouldn’t it? If I improve my house, should the imputed rent go up? What if I let things slide a bit?

    More to the point, I assume there will be allowances as well.

    If the imputed rent is 12k per annum, and I spend 15k on replacing the kitchen, do I get 3k added to my tax allowance?

    Does the new kitchen increase the imputed rent, thus reducing the amount the government owes me?

  25. AndrewC,

    His daughter should divorce, and he should enter a gay marriage with his (former) son-in-law.

  26. In related news, Sadiq Khan wants an amnesty for any illegal immigrant who lived in Grenfell tower.

    Apparently there were over 49,000 living there, and rising, including 34,500 children, all with beards.

  27. “Chap in his 70s has lots of money (say £2.5m) and is told he has only 6 months to live. His wife is dead. He has one married daughter, no sons. No grandchildren. He hasn’t done any IHT planning. He wants to minimise or eliminate IHT so his daughter and son-in-law can do all the things he wished he’d done with the money. What advice can you give him?

    Step one, buy a house worth £1m immediately. This can then be passed directly children using the £1m for PPR relief (thats assuming none of the wife’s IHT allowance was used on her death, if it was reduce value of house accordingly).
    Step two marry someone (male or female) that he trusts 100% to pass on the value of his estate when he dies.

  28. @Andrew M & Jim

    Yep. Marrying just before you die is about the only death bed planning that works without pre-planning. A civil partnership with the recently divorced son-in-law works (and civil partnerships don’t require consummation). Once the bloke has popped his clogs, the son can re-marry the daughter and pass the money back to her. There’s actually a 2 year claw-back possible so it’s best to wait a while.

    Works also for a single parent with minor children. You do need, as Jim mentions, a trusted friend. In that case the cash could be put in trust by the friend for the benefit of the child.

    Provided 7 years passes by, all is well.

    Call me a cynic but I think IHT was the reason behind Jade Goody, Michael Winner and other ‘get married just before you die’ situations.

  29. We have friends just turned 70 who have lived together for over 40 years. They got married a few weeks ago at the insistence of their IFAs.

  30. AndrewC

    Set up *a business*? Something about family shareholders being able to pass on equity, free of IHT on death? Correct me if I’ve misremembered / misread something?

    If yes, sure marraige is much simpler, always assuming you can 100% trust the third party.

  31. Lose it all on betfair backing 1.01 ‘no try scorer’ in the next rugby league match. Make sure the daughter is offering 2.5 million to 25000 on the other end of the bet first.

  32. bloke in france said:
    “Buy agricultural land and pretend you’re a farmer.”

    Think even that needs 2 years between purchase and death; question said he’s only got 6 months.

  33. BiF,

    > Buy agricultural land and pretend you’re a farmer.

    There’s a two-year rule for the IHT exemption.

    I like the Betfair idea. But that’s bound to raise flags with the Inland Revenue, just as if the father walked into the Hippodrome with £2.5m, exchanged it all for casino chips, then the daughter walked out with £2.49m (and one hell of a hangover).

  34. Well, in my accounts I list an amount as “rent” for the OO place I live in. But it also appears as income in a different aspect elsewhere, so balances out. It’s a useful accountancy conceit to keep track of the fact that being alive costs money. It makes for better budet planning to say that my “rent” is £X per month instead of I need £A in January and February but £B in March because of something else and £C in April because item D is paid for every three months, etc.

  35. @ Andrew M
    Most refugees are dumped in whichever council flat is least easy to rent to a local – a hell of a lot were dumped in some tower blocks in Glasgow that families from the Gorbals were no longer willing to tolerate; a few years ago they were blown down by a controlled explosion because it was deemed that they could not be made fit for human habitation. Logical deduction is that hundreds of refugees had been living in flats that *were* “unfit for human habitation”.

    That some were dumped in Kensington just tells you that *no-one* who was a local wanted to live in Grenfell Tower. It is then not all that surprising that the other council tenants in Kensington ignored their complaints because they regarded them as inferiors who would take the rubbish that they discarded.

  36. @ Jim
    trusts 100% …
    We’ve been married more than 30 years and our solicitor insists that we each leave 50% of the house to the boys with a provision for the survivor to live in it (or a subsequent home).

  37. I would advise the gentleman to become a firebrand Labour MP with deep socialist principles; he will then be able to structure his estate in precisely the way which means the beneficiaries won’t pay a fucking penny.

  38. Rob wins the IHT question.

    such planning will be ‘different’ from normal selfish evil IHT planning because of reasons.

  39. “PF

    AndrewC

    Set up *a business*? Something about family shareholders being able to pass on equity, free of IHT on death? Correct me if I’ve misremembered / misread something?”

    There is an exemption for such things….but again a 2 year holding period required.

    A tax partner I worked with advocated every wealthy person setting up a dormant company whilst fit & healthy. If, years later, you are suddenly given a few months to live, you can subscribe all your worldly worth for new shares in your company which then immediately starts trading. Buying and selling land or houses would do.

    When you die, the company is a trading company and it isn’t the TRADE which has to have been carried on for two years but the SHARES which have to have been held for two years and since you owned 100% of the company both before and after the later share subscription, the new shares are treated as being owned for as long as the original shares….more than 2 years.

    Do it properly and No IHT. beneficiaries inherit the company at the uplifted death value and can either actually carry on trading or just put it all into liquidation.

    A few thousand in fees is better than 40% in IHT

  40. AndrewC

    That’s really interesting – thanks for that.

    I hadn’t appreciated the 2 year issue, or that it could be 100% owned, which as you say makes it relatively easy to enact / put in place well ahead.

    Yes, as with all these things – definitely worth a bit of planning investment!

  41. There are so many loopholes.
    I think it was Roy Jenkis who said that anyone who paid IHT loved the texman more than his own family.

  42. @ Andrew M
    WTF? This a council-owned block with a ban on sub-letting?
    So why were they putting refugees in there instead of sending them to Glasgow?
    One of the things that really pissed me off about Gordon Brown was that the refugees were sent to Glasgow and when some civil service bureaucrat made a mistake they had to get a bus to Croydon or Liverpool when they had no money to pay the bus fare – forget about nowhere to sleep, no money for food, an 18-hour journey, the bungling by the DWP meant that trhey couldn’t pay the bus fare to go to Croydon to pointout that DWP had got it wrong.

  43. I don’t know whether spudotollah proves or disproves the infinite monkey theorem ie The infinite monkey theorem states that a monkey hitting keys at random on a typewriter keyboard for an infinite amount of time will almost surely type a given text, such as the complete works of William Shakespeare. Murphy certainly proves that a monkey at a keyboard can write gibberish

  44. John77,

    Some of the flats in the block would have been bought by their tenants under Thatcher’s Right-to-Buy. At that point they become normal (i.e. non-council, private) flats. The owner is free to sell up, to let them out at market rate, etc. The freehold of the building remains with the council.

    I briefly rented an ex-council flat myself. It was spacious and in an excellent location, albeit a concrete eyesore.

  45. The owner is free to sell up, to let them out at market rate, etc. The freehold of the building remains with the council.

    And the private owner would have paid their full share of the cost of that cladding and refurbishment. One of the big problems with owning ex-council property in a block, less effective control over service charges than in a privately owned block.

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