July 9, 2025 • 15 mins
In this week's roundup, Bloomberg UK Wealth Editor at Large Merryn Somerset Webb speaks with Money Distilled newsletter author John Stepek about the UK's debt problem. A report from Britain’s fiscal watchdog – the OBR – warns that the country faces "daunting" risks, as a soaring debt load has led to “substantial erosion” of its capacity to respond to future shocks.
So how will the government tackle that debt? Everyone’s suddenly talking about wealth taxes - but we might not get the wealth taxes everyone expects. Merryn and John look at why inheritance tax on homes, and capital gains tax, both look like potential targets - and talk about why politics always gets in the way of good policy.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, Radio News. Welcome to the Marin
Talks Money Market Wrap, where we talk about the biggest
moves in market this week and what is driving them.
(00:24):
I'm Marren Sum's that web editor at Large for Bloomberg
UK Wealth.
Speaker 2 (00:27):
And I'm joined Stepic, senior reporter for Bloomberg and author
of the Money Distilled newsletter.
Speaker 1 (00:33):
Morning John Mordon Marin. So today I think we really
have to talk about debt and we have to talk
about tax I mean, this week has been I suppose
you could say every week for quite a long time,
it's been kind of the same, but this has been
one of the weeks when the problems globally with public
levels of debt has come right to the four again,
and that has particularly been the case in the UK,
(00:55):
where we've had this report out from the OBL saying
that things are really very very very bad. So we've
got tax burden at a seventy five year high, but
yet our finances are described as vulnerable, daunting, growing pressures,
unsustainable position in the long term, and the UK cannot
afford the array of promises that it has made to
(01:15):
the public. Now, you and I have talked a lot
about this in the past, thing that one of the
ways you grow out of debt is to default on
your promises to the public, and that it's just one
of many things that's going to happen. But we are
also beginning to see the impact of all this concern
about UK levels of unsustainable debt. We're beginning to see
that in the debt markets themselves.
Speaker 2 (01:36):
Right, Yeah, I think so, And it is something that
we've talked about a lot. But I mean even the
RBR point so that the UK in terms of its
bordering costs is higher than almost any sort of peer economy.
I think the only ones that are there, let me
just check this report, but I think the only ones
that are doing. What's from that point of view is, yeah,
(02:00):
government is fourth highest among advanced European economies, six highest
among advanced economies after Japan and Greece, Italy, France and
the US. But we also face the third highest borrowing
cost of any advanced economy after New Zealand and Iceland.
And you know, I mean New Zealand and Iceland aren't
exactly major economies, no.
Speaker 1 (02:20):
So just to put it in perspective that our thirty
year yelled is now what five point four five percent
four something like that, and the tenure yield at four
point four point six ish. So these are very high
borrowing costs for the UK.
Speaker 2 (02:37):
Yeah, and the problem is that it's happening at a
time where we also get very high debt, so we're
paying a very high interest rate on a massive pile
of debt. To my mind, I think, and I think
the thing that the OBR is pointing out is that
this is not a trajectory, isn't sustainable. And one of
the kind of like key charts in this OBR report
(03:00):
is one where the point that every single time there's
a budget, the government promises whichever government obviously not just
does government promises that the trajectory is going to improve,
that we're going to cut down or the deficit, and
the actual outturn is that it just keeps getting bigger
and bigger.
Speaker 1 (03:19):
And we seem absolutely incapable, as discussed previously and everyone
has seen over the last couple of weeks, incapable of
cutting spending. We cannot do anything about our insane welfare bill.
We cannot do even a tiny little chip around the edge.
It just fails. The expectations of the population are I
was constantly ratcheting up, and it doesn't seem to be
a way out.
Speaker 2 (03:40):
I think trying to get to the heart of why
that is is interesting. I mean, it is difficult to
take stuff away from people, but I do think that
there's a sense among I think almost everyone feels that
there's someone else that is getting something they are not
entitled to, or that there's someone else who is not
(04:01):
being taxed heavily enough. And so this is one of
the reasons why if you target anything at all, there's
this sort of big bike lash. But they also don't
do it very well. I mean, the winter fuel allowance
is a very good case in point. There were many
ways you could have done that, and they chose basically
the worst way to do it. So there's an element
(04:22):
being bad at politics involved here.
Speaker 1 (04:25):
It's true. I mean the winter fuel payment always seems
to me that it should be part of the different
part of the benefit system. Or if you think people
should have extra extra pension, which is effectively what it was,
put it on the pension. And if it's not effectively
extra pension, what is it for in the first place.
I mean, all this stuff, you can pick any part
of the welfare system and talk about how ridiculous it is.
And one of the things that you and I were
(04:46):
talking about briefly the other day was the extraordinary fact
that you can claim an awful lot of benefits in
the UK while still living in a house that you own.
Out right. You can live in a two million pound
house in London and still claim Universal Benefit. For example.
There's one of the many madnesses inside a system that
is now so complicated and so full of entitlement that
(05:06):
is practically impossible to clean up so that the genuinely
needy other ones in receipt. Let's not go down any
welfare rabbit holes. I could do it, but let's not.
Speaker 2 (05:15):
I think again, there is the ailment special interest groups law,
because we've always protected viewed the hosts as some sort
of advantage in this country, and so I think that, yeah,
it just speaks to the way they're thing of that
we know have so many third rails that there is
(05:37):
nothing you can do.
Speaker 1 (05:38):
Yeah, and there is there is no sense from politicians
that you can come out and say, well, actually, every
time you try and change anything, everyone says, well, you
don't care about the poor, or you don't care about
the disabled, and the message needs to change too. If
you really want to protect the poor and the disabled
long term, then you need massive reform or in the
end no one gets protected.
Speaker 2 (05:57):
Absolutely, And I think, but I guess this is what
market so for, isn't it.
Speaker 1 (06:01):
This is what markets are for. Markets are giving giving
that message very very strongly to the UK, very strongly.
So the solution, obviously, this solution is to massively reform
everything in sight quickly. That's not going to happen. So
what's as you're going to happen is the tax burden
is going to rise from its current seventy five year high.
(06:22):
And the talk at the moment is around a wealth taxture.
There'd be a wealth tax in the UK. Now, you
and I we've talked about this so much, and the
answer is no, of course, not everywhere there is a
wealth tax. It failed. This will be a disaster. And
anyone who thinks that it's fine, it's all right, it's
only it's not me, it's the other rich people. Let
us introduce you to fiscal drag.
Speaker 2 (06:42):
The wealth tax is one of those things like rent controls,
where you he almost it's almost not worth engaging in
the argument because if someone still believes it walks by now,
then they aren't amenable to reasonable conversation. They just want
to believe that a wealth tax will solve things. They
(07:04):
just want to believe the main controls will solve things.
So there's nothing you can see to change their mains.
Speaker 1 (07:10):
Even though you've got, you know, hundreds of years of
history to show it isn't true. However, regardless of what
you and I think about this, there are going to
be more taxes on wealth. And it may be it
may be that this is not what we might call
an official wealth tax. But one thing that we know
you and I is that there are ready a lot
of wealth taxes in the UK. And the most likely
thing we'll see from here is an increase in some
(07:31):
of the wealth taxes that we already have. And I'm
sure there are conversations going on around increasing capital gains tax.
There'll be conversations around IHT. And I was looking at
a note from RSN today and there are horrifying suggestions
in here, John, one of which is that they might
look at the resident and nil rate band for IHT,
(07:54):
so that idea that you can pass on an additional
amount of money attached to your main home. There is
always a bit of a fiddle, a complete fiddle free
of IHT, and that the suggestion is that that might
be removed such that you only have your nil rate
band of three hundred and twenty five thousand pounds per
(08:14):
head to pass on as opposed to the extra what
is it one hundred and seventy five thousands per head
for this mythical family house, and that would that would
bring an awful lot of new people into the IHT bracket,
which is unpleasant. On the other really nasty possibility might
be the removal of this idea that all your assets
(08:34):
are re based for capital gains purposes on death, so
when you die, you're a status not liable for capital's
gains tax. It is only liable for IHT and multie.
That creates all sorts of complicated tax planning things for
all sorts of PEP And they don't like to sell
and pay capital gains tax when they're old, because then
maybe double tax effectively or five hundred times tax given
(08:57):
the way that the UK system works. Removal of that
would mean that on death you would pay both capital
gains and then IHD. So so for example, let's say
you inherited one hundred thousand pounds which had capital gains tax,
so the net value had gone up. You would then
pay your capital gains tax, and having paid that, you
(09:17):
would then pay IHT on the remainder.
Speaker 2 (09:22):
I can see that happening. Then nobody bind for how
you ses? I think, well, if they need a political
back life, that that would be like they went a
fuel of leans kind of like times one hundred. But
the CGT thing, I think that would go over most
people's heads.
Speaker 1 (09:38):
Yes, I do, well, entil they had to pay it.
So look at it like this. Let's say, do you
know what I mean?
Speaker 2 (09:44):
That's a long wead on the lane for pts of
the people who may complain about it.
Speaker 1 (09:49):
But it would also mean that you know people who
inherited relatively small amounts, or you might think of a
smaller towns and in terms of IHT or in terms
of inheriting housing etctera. Say you inherited something worth only
one hundred thousand pounds, we had a capital gain of
one hundred thousand pounds, right, yeah, and then you pay
(10:09):
twenty four thousand pounds in CGT. Then you would pay
thirty thousand, four hundred pounds in IHT on the remainder,
So the overall tax rate on that bit of inheritance
is fifty four percent. Yeah, I mean, and even if
you weren't liable for IHT, maybe you thought you were
(10:32):
inheriting this thing, and you know, you don't consider yourself
to be the kind of personal liable for tax on
an inheritance, and you would still pay your twenty four
thousand pounds. I mean, I think would cause a bit
of an uproar. But nonetheless, that is a wealth tax,
a new wealth tax.
Speaker 2 (10:46):
Did they have any idea or any estimate at how
much that would raise? Because the thing that gets me
about all of this is that in terms of the
gap between what we need realistically and what we get
from all of these wealth taxes.
Speaker 1 (11:03):
Is big.
Speaker 2 (11:04):
And if you've if you've ruled out touching things like
income tax and VAT, is very very hard to fill.
Speaker 1 (11:11):
Absolutely, this is fiddling around the edges, and it's absolutely
fiddling around the edges. But you know it's it's performative
wealth tax, isn't it. Yeah.
Speaker 2 (11:20):
But I mean, again that brings us back to the
whole point about the markets, because I think one of
the issues with the markets. That possibly is that goes
a little bit under discust is that it's not about
the absolute numbers. It's about the sense that you're not
getting a grip. It's you know, you can run a
big deficit if people think that you're actually doing something
(11:44):
with it. But at the moment, and for a long
time now, it feels as a Britain is just sort
of spiling its spiraling around the plug hole and as
you say, sort of targeting bits and pieces that are
actually getting in the way and making everything harder and
just clogging up the kind of economies. Are cities more
than more base if they try to simplify things, And
(12:04):
that looked as if we were going to get some
sort of plan in place that would actually want to
get the economy growing and all the rest, then I
think that the markets would give more levy. I think.
I mean, basically, it's a governance issue. It's not our
financial as a financial issue. As a governance so Isshoe
fast and.
Speaker 1 (12:21):
Foremost, although reminded John that you can't plan growth and
you can't create growth the way and let growth happen.
Speaker 2 (12:27):
Yeah, that's the problem.
Speaker 1 (12:31):
I mean, I think you and I both know all
our listeners. Was also know that there's this isn't impossible
that pretty much everything, not everything, but pretty much everything
that is wrong with the UK can be fixed with
major policy change. And those major policy changes aren't complicated
until you start trying to implement them in a political environment. Right,
and the simplest way forward from here is to increase
(12:54):
the rate of income tax for everybody. You know the moment,
what is the number? Fifty fifty five percent of of
UK households are net receivers as opposed to net contributors
to the system. That's not sustainable. This idea that you
constantly take more and more and more people out of
tax by keeping this historical thing we've had of raising
the basic allowance for income tax to try and make
(13:16):
sure that people don't pay tax was possibly the wrong approach.
In the end, everybody has to contribute if you want
to have a state of this size and if you
want to continue to offer all these things. If you
don't want that, then you have to find a way
to cut spending. It's really it's not complicated on the
face of it. It's only complicated inside the political environment
that we have created for ourselves. With a little political will,
(13:39):
and you know, one have thought, I think you and
I have thought that a government with a vast majority
like this might have the ability to make the changes
that were necessary. But clearly, clearly it does not. So
here we go down the plug hole, John all over
the end of Britain.
Speaker 2 (13:55):
Yeah, yeah, yeah, yeah.
Speaker 1 (13:58):
You can look forward to you can look forward to
a sharp rise in non income tax taxes from here,
followed by a sharp rise in the in the guilty yeldom,
followed by things that I don't really want to think about,
but certainly a defaulting of the state's promises to its population.
Have you got anything cheery to add, John before I
(14:19):
sign off, because I really really appreciated if you did.
Speaker 2 (14:24):
I don't really you know, it was some really interesting
I read something in Bloomberg response saying that you tell us,
you know the stable coin issure, You've got a stash
of eight billion dollars worth of gold, so maybe finding
a private central bank is what we all need to do.
Speaker 1 (14:43):
That's so interesting. Even crypto moves to gold in the end.
When I was tweeting about the UK's levels of debt
this morning, pretty much everyone replied to me saying, God
bitcoin to which my response was no, but I have
got gold.
Speaker 2 (15:00):
I'm going to steal that one.
Speaker 1 (15:01):
You aren't you. You haven't got any crypto at least
I've got some. No. None. Thanks for listening to this
week's Marin Talks Money Debrief. If you like our show,
rate review, and subscribe wherever you listen to podcasts. Also
be sure to follow me in John on x or
Twitter at mariness w and John underscore Stepeg. This episode
(15:23):
was produced by some Asadi, production support and sound designed
by Moses and Questions and comments on the show and
all our shows are always welcome. Our show email is
Merri Money at Bloomberg dot net
Bloomberg Audio Studios, Podcasts, Radio News. Welcome to the Marin
Talks Money Market Wrap, where we talk about the biggest
moves in market this week and what is driving them.
(00:24):
I'm Marren Sum's that web editor at Large for Bloomberg
UK Wealth.
Speaker 2 (00:27):
And I'm joined Stepic, senior reporter for Bloomberg and author
of the Money Distilled newsletter.
Speaker 1 (00:33):
Morning John Mordon Marin. So today I think we really
have to talk about debt and we have to talk
about tax I mean, this week has been I suppose
you could say every week for quite a long time,
it's been kind of the same, but this has been
one of the weeks when the problems globally with public
levels of debt has come right to the four again,
and that has particularly been the case in the UK,
(00:55):
where we've had this report out from the OBL saying
that things are really very very very bad. So we've
got tax burden at a seventy five year high, but
yet our finances are described as vulnerable, daunting, growing pressures,
unsustainable position in the long term, and the UK cannot
afford the array of promises that it has made to
(01:15):
the public. Now, you and I have talked a lot
about this in the past, thing that one of the
ways you grow out of debt is to default on
your promises to the public, and that it's just one
of many things that's going to happen. But we are
also beginning to see the impact of all this concern
about UK levels of unsustainable debt. We're beginning to see
that in the debt markets themselves.
Speaker 2 (01:36):
Right, Yeah, I think so, And it is something that
we've talked about a lot. But I mean even the
RBR point so that the UK in terms of its
bordering costs is higher than almost any sort of peer economy.
I think the only ones that are there, let me
just check this report, but I think the only ones
that are doing. What's from that point of view is, yeah,
(02:00):
government is fourth highest among advanced European economies, six highest
among advanced economies after Japan and Greece, Italy, France and
the US. But we also face the third highest borrowing
cost of any advanced economy after New Zealand and Iceland.
And you know, I mean New Zealand and Iceland aren't
exactly major economies, no.
Speaker 1 (02:20):
So just to put it in perspective that our thirty
year yelled is now what five point four five percent
four something like that, and the tenure yield at four
point four point six ish. So these are very high
borrowing costs for the UK.
Speaker 2 (02:37):
Yeah, and the problem is that it's happening at a
time where we also get very high debt, so we're
paying a very high interest rate on a massive pile
of debt. To my mind, I think, and I think
the thing that the OBR is pointing out is that
this is not a trajectory, isn't sustainable. And one of
the kind of like key charts in this OBR report
(03:00):
is one where the point that every single time there's
a budget, the government promises whichever government obviously not just
does government promises that the trajectory is going to improve,
that we're going to cut down or the deficit, and
the actual outturn is that it just keeps getting bigger
and bigger.
Speaker 1 (03:19):
And we seem absolutely incapable, as discussed previously and everyone
has seen over the last couple of weeks, incapable of
cutting spending. We cannot do anything about our insane welfare bill.
We cannot do even a tiny little chip around the edge.
It just fails. The expectations of the population are I
was constantly ratcheting up, and it doesn't seem to be
a way out.
Speaker 2 (03:40):
I think trying to get to the heart of why
that is is interesting. I mean, it is difficult to
take stuff away from people, but I do think that
there's a sense among I think almost everyone feels that
there's someone else that is getting something they are not
entitled to, or that there's someone else who is not
(04:01):
being taxed heavily enough. And so this is one of
the reasons why if you target anything at all, there's
this sort of big bike lash. But they also don't
do it very well. I mean, the winter fuel allowance
is a very good case in point. There were many
ways you could have done that, and they chose basically
the worst way to do it. So there's an element
(04:22):
being bad at politics involved here.
Speaker 1 (04:25):
It's true. I mean the winter fuel payment always seems
to me that it should be part of the different
part of the benefit system. Or if you think people
should have extra extra pension, which is effectively what it was,
put it on the pension. And if it's not effectively
extra pension, what is it for in the first place.
I mean, all this stuff, you can pick any part
of the welfare system and talk about how ridiculous it is.
And one of the things that you and I were
(04:46):
talking about briefly the other day was the extraordinary fact
that you can claim an awful lot of benefits in
the UK while still living in a house that you own.
Out right. You can live in a two million pound
house in London and still claim Universal Benefit. For example.
There's one of the many madnesses inside a system that
is now so complicated and so full of entitlement that
(05:06):
is practically impossible to clean up so that the genuinely
needy other ones in receipt. Let's not go down any
welfare rabbit holes. I could do it, but let's not.
Speaker 2 (05:15):
I think again, there is the ailment special interest groups law,
because we've always protected viewed the hosts as some sort
of advantage in this country, and so I think that, yeah,
it just speaks to the way they're thing of that
we know have so many third rails that there is
(05:37):
nothing you can do.
Speaker 1 (05:38):
Yeah, and there is there is no sense from politicians
that you can come out and say, well, actually, every
time you try and change anything, everyone says, well, you
don't care about the poor, or you don't care about
the disabled, and the message needs to change too. If
you really want to protect the poor and the disabled
long term, then you need massive reform or in the
end no one gets protected.
Speaker 2 (05:57):
Absolutely, And I think, but I guess this is what
market so for, isn't it.
Speaker 1 (06:01):
This is what markets are for. Markets are giving giving
that message very very strongly to the UK, very strongly.
So the solution, obviously, this solution is to massively reform
everything in sight quickly. That's not going to happen. So
what's as you're going to happen is the tax burden
is going to rise from its current seventy five year high.
(06:22):
And the talk at the moment is around a wealth taxture.
There'd be a wealth tax in the UK. Now, you
and I we've talked about this so much, and the
answer is no, of course, not everywhere there is a
wealth tax. It failed. This will be a disaster. And
anyone who thinks that it's fine, it's all right, it's
only it's not me, it's the other rich people. Let
us introduce you to fiscal drag.
Speaker 2 (06:42):
The wealth tax is one of those things like rent controls,
where you he almost it's almost not worth engaging in
the argument because if someone still believes it walks by now,
then they aren't amenable to reasonable conversation. They just want
to believe that a wealth tax will solve things. They
(07:04):
just want to believe the main controls will solve things.
So there's nothing you can see to change their mains.
Speaker 1 (07:10):
Even though you've got, you know, hundreds of years of
history to show it isn't true. However, regardless of what
you and I think about this, there are going to
be more taxes on wealth. And it may be it
may be that this is not what we might call
an official wealth tax. But one thing that we know
you and I is that there are ready a lot
of wealth taxes in the UK. And the most likely
thing we'll see from here is an increase in some
(07:31):
of the wealth taxes that we already have. And I'm
sure there are conversations going on around increasing capital gains tax.
There'll be conversations around IHT. And I was looking at
a note from RSN today and there are horrifying suggestions
in here, John, one of which is that they might
look at the resident and nil rate band for IHT,
(07:54):
so that idea that you can pass on an additional
amount of money attached to your main home. There is
always a bit of a fiddle, a complete fiddle free
of IHT, and that the suggestion is that that might
be removed such that you only have your nil rate
band of three hundred and twenty five thousand pounds per
(08:14):
head to pass on as opposed to the extra what
is it one hundred and seventy five thousands per head
for this mythical family house, and that would that would
bring an awful lot of new people into the IHT bracket,
which is unpleasant. On the other really nasty possibility might
be the removal of this idea that all your assets
(08:34):
are re based for capital gains purposes on death, so
when you die, you're a status not liable for capital's
gains tax. It is only liable for IHT and multie.
That creates all sorts of complicated tax planning things for
all sorts of PEP And they don't like to sell
and pay capital gains tax when they're old, because then
maybe double tax effectively or five hundred times tax given
(08:57):
the way that the UK system works. Removal of that
would mean that on death you would pay both capital
gains and then IHD. So so for example, let's say
you inherited one hundred thousand pounds which had capital gains tax,
so the net value had gone up. You would then
pay your capital gains tax, and having paid that, you
(09:17):
would then pay IHT on the remainder.
Speaker 2 (09:22):
I can see that happening. Then nobody bind for how
you ses? I think, well, if they need a political
back life, that that would be like they went a
fuel of leans kind of like times one hundred. But
the CGT thing, I think that would go over most
people's heads.
Speaker 1 (09:38):
Yes, I do, well, entil they had to pay it.
So look at it like this. Let's say, do you
know what I mean?
Speaker 2 (09:44):
That's a long wead on the lane for pts of
the people who may complain about it.
Speaker 1 (09:49):
But it would also mean that you know people who
inherited relatively small amounts, or you might think of a
smaller towns and in terms of IHT or in terms
of inheriting housing etctera. Say you inherited something worth only
one hundred thousand pounds, we had a capital gain of
one hundred thousand pounds, right, yeah, and then you pay
(10:09):
twenty four thousand pounds in CGT. Then you would pay
thirty thousand, four hundred pounds in IHT on the remainder,
So the overall tax rate on that bit of inheritance
is fifty four percent. Yeah, I mean, and even if
you weren't liable for IHT, maybe you thought you were
(10:32):
inheriting this thing, and you know, you don't consider yourself
to be the kind of personal liable for tax on
an inheritance, and you would still pay your twenty four
thousand pounds. I mean, I think would cause a bit
of an uproar. But nonetheless, that is a wealth tax,
a new wealth tax.
Speaker 2 (10:46):
Did they have any idea or any estimate at how
much that would raise? Because the thing that gets me
about all of this is that in terms of the
gap between what we need realistically and what we get
from all of these wealth taxes.
Speaker 1 (11:03):
Is big.
Speaker 2 (11:04):
And if you've if you've ruled out touching things like
income tax and VAT, is very very hard to fill.
Speaker 1 (11:11):
Absolutely, this is fiddling around the edges, and it's absolutely
fiddling around the edges. But you know it's it's performative
wealth tax, isn't it. Yeah.
Speaker 2 (11:20):
But I mean, again that brings us back to the
whole point about the markets, because I think one of
the issues with the markets. That possibly is that goes
a little bit under discust is that it's not about
the absolute numbers. It's about the sense that you're not
getting a grip. It's you know, you can run a
big deficit if people think that you're actually doing something
(11:44):
with it. But at the moment, and for a long
time now, it feels as a Britain is just sort
of spiling its spiraling around the plug hole and as
you say, sort of targeting bits and pieces that are
actually getting in the way and making everything harder and
just clogging up the kind of economies. Are cities more
than more base if they try to simplify things, And
(12:04):
that looked as if we were going to get some
sort of plan in place that would actually want to
get the economy growing and all the rest, then I
think that the markets would give more levy. I think.
I mean, basically, it's a governance issue. It's not our
financial as a financial issue. As a governance so Isshoe
fast and.
Speaker 1 (12:21):
Foremost, although reminded John that you can't plan growth and
you can't create growth the way and let growth happen.
Speaker 2 (12:27):
Yeah, that's the problem.
Speaker 1 (12:31):
I mean, I think you and I both know all
our listeners. Was also know that there's this isn't impossible
that pretty much everything, not everything, but pretty much everything
that is wrong with the UK can be fixed with
major policy change. And those major policy changes aren't complicated
until you start trying to implement them in a political environment. Right,
and the simplest way forward from here is to increase
(12:54):
the rate of income tax for everybody. You know the moment,
what is the number? Fifty fifty five percent of of
UK households are net receivers as opposed to net contributors
to the system. That's not sustainable. This idea that you
constantly take more and more and more people out of
tax by keeping this historical thing we've had of raising
the basic allowance for income tax to try and make
(13:16):
sure that people don't pay tax was possibly the wrong approach.
In the end, everybody has to contribute if you want
to have a state of this size and if you
want to continue to offer all these things. If you
don't want that, then you have to find a way
to cut spending. It's really it's not complicated on the
face of it. It's only complicated inside the political environment
that we have created for ourselves. With a little political will,
(13:39):
and you know, one have thought, I think you and
I have thought that a government with a vast majority
like this might have the ability to make the changes
that were necessary. But clearly, clearly it does not. So
here we go down the plug hole, John all over
the end of Britain.
Speaker 2 (13:55):
Yeah, yeah, yeah, yeah.
Speaker 1 (13:58):
You can look forward to you can look forward to
a sharp rise in non income tax taxes from here,
followed by a sharp rise in the in the guilty yeldom,
followed by things that I don't really want to think about,
but certainly a defaulting of the state's promises to its population.
Have you got anything cheery to add, John before I
(14:19):
sign off, because I really really appreciated if you did.
Speaker 2 (14:24):
I don't really you know, it was some really interesting
I read something in Bloomberg response saying that you tell us,
you know the stable coin issure, You've got a stash
of eight billion dollars worth of gold, so maybe finding
a private central bank is what we all need to do.
Speaker 1 (14:43):
That's so interesting. Even crypto moves to gold in the end.
When I was tweeting about the UK's levels of debt
this morning, pretty much everyone replied to me saying, God
bitcoin to which my response was no, but I have
got gold.
Speaker 2 (15:00):
I'm going to steal that one.
Speaker 1 (15:01):
You aren't you. You haven't got any crypto at least
I've got some. No. None. Thanks for listening to this
week's Marin Talks Money Debrief. If you like our show,
rate review, and subscribe wherever you listen to podcasts. Also
be sure to follow me in John on x or
Twitter at mariness w and John underscore Stepeg. This episode
(15:23):
was produced by some Asadi, production support and sound designed
by Moses and Questions and comments on the show and
all our shows are always welcome. Our show email is
Merri Money at Bloomberg dot net
Host
Merryn Somerset Webb
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