Alistair Fenton complains that the abolition of corporation tax rebates in 1998 raided pension funds (Letters, February 6).
Alistair Fenton complains that the abolition of corporation tax rebates in 1998 raided pension funds (Letters, February 6).
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That's not so: corporation tax rates and exemptions were cut. That fall in tax rates from 31% to 28% led to an increase in share values and higher dividend receipts; which, in turn, increased the value of UK pension funds and savings. Rising share prices this year are partially restoring pension fund values. Between 1989 and 2010 income tax was lowered from 24% to 20%, increasing pensioners' net income. True, national insurance rates were increased by 1% to fund extra spending on the NHS, but pensions don't pay national insurance.
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Falling inflation and low annuities
Alistair Fenton complains that the abolition of corporation tax rebates in 1998 raided pension funds (Letters, February 6).
That's not so: corporation tax rates and exemptions were cut. That fall in tax rates from 31% to 28% led to an increase in share values and higher dividend receipts; which, in turn, increased the value of UK pension funds and savings. Rising share prices this year are partially restoring pension fund values. Between 1989 and 2010 income tax was lowered from 24% to 20%, increasing pensioners' net income. True, national insurance rates were increased by 1% to fund extra spending on the NHS, but pensions don't pay national insurance.
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We moderate all comments on HeraldScotland on either a pre-moderated or post-moderated basis. If you're a relatively new user then your comments will be reviewed before publication and if we know you well then your comments will be subject to moderation only if other users or the moderators believe you've broken the rules, which are available here.
Moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours. Please be patient if your posts are not approved instantly.
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