Editor’s foreword

The Chancellor (alias The Dark Lord of Nasty Surprises) is not noted for his generosity, but at least he appears to have left most trusts and tax advisers alone in the pre-Budget Report of 2 December 2004. That is, unless you are involved in the tax and trust equivalents of quantum mechanics. I believe the new anti-tax abuse rules are targeted at strippers in old Bond films or something like that? Perhaps I was just dreaming. Readers will have leapt with joy to hear that:

The inheritance tax nil-rate threshold will increase from £263,000 to £272,000 in 2004-2005. Little use if your house has doubled or tripled in value during the past five years. But, you’ll at least be dead when it bites (unless you are now to be caught in the pre-owned assets rules, but that’s only about 10,000 people and they probably all go hunting, so never mind.) This £9,000 increase apparently costs the poor old government £144m. The whole nil-rate band will set them back £9.5bn for 2004-2005.
The capital gains tax annual exempt amount will rise from £8,200 to £8,500 for individuals and from £4,100 to £4,250 for most trusts. This apparently costs the government £12m. But, it is insignificant when the cost to the government of the principal private-residence exemption is estimated to be £12bn for 2004-2005. That is a lot of noughts and, like most taxes, it creates a rather large economic distortion.
ISA’s will cost the government £1.2bn in lost income tax for 2004-2005. But then they invented them, so that’s their own fault. No getting out of that one, although of course it was worth a try. Next time lucky eh Chancellor?
The zero VAT rating of burial and cremation costs the Treasury another £100m. Place a tax on death? Now who would dream of such a terrible thing? (See sub-paragraph 1 above).
The horrendously complex tax-credit system is to continue. The point of most people saving small amounts is increasingly lost as a result of means-testing in old age. And, its good news for benefits hotlines. They are likely to be kept busy. Buy those shares now.

What do readers think might readily plug the apparent £12bn ‘black hole’ in government finances come the next general election? The clue is in the figures. Just kidding. Hmmm.

As the season for over-indulgence is upon us, I got to thinking about eating and indeed cutting back. ECA readers naturally only have a greed for knowledge whereas, after some slight delay, your esteemed editor has only recently become re-shaped to that of the more youthful and slimmer picture gracing this page. Diets will also be all the rage again when the post-election tax hikes arrive as usual.

Naturally, I rely on balanced healthy eating combined with use of high quality speciality beers. Well, it works for me. But you could try the following, far more awkward, ones (believe me, I know. You have my sympathy). I have a signed first edition of The Popcorn Diet Plus by Joel Herskowitz MD (Pharos NY 1987). Popcorn is your daily hunger filler, high carb and high fibre, but it’s a bit boring and you feel like Homer Simpson when sitting in front of the TV. I am not enthusiastic about the ‘Plunge Phase’ and ‘Wogging’ (walking cum jogging) incorporated in the Beverley Hills Medical Diet by Arnold Fox MD (Chain-Pinkham USA 1981). Furthermore, I am not famous enough to use it seriously and have never been inconveniently hindered by good looks. Nor do I personally care for

The Rice Diet Report by Judy Moscovitz (GP Putnam NY 1986) based on (you’ve guessed it) rice. Although, I do like rice pudding with raspberry jam in it. I could go on. If anyone wants to write the recipes, there is a bestseller in Coldrick’s Yorkshire Beers Diet. I’d sell it with the slogan ‘If you’ve tried em all then try this one. Your body will soon be tighter than a Tetley teabag.’

David Coldrick
Editor
david.coldrick@wrigleys.co.uk

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