The rich aren’t spreading their cash, and we’re not getting any better off

A very interesting show on BBC2 last night about the richest people in the UK. It’s interesting to see how half-heartedly the tax inspectors are chasing the wealthy and seem to actually allow tax avoidance schemes, only attacking them here and there. Increasing the amount that the wealthy get taxed seems to push the super-rich into either entering into tax-avoidance schemes or leaving the country, so taxes have been kept low for them. The “non domicile” residents only pay £30,000 tax per year, which is nothing if you’re rich.

Tax avoidance schemes, by the way, cost the UK around £20bn in revenue last year. That’s around 20% of the NHS budget.

There’s a theory, according to the programme, that low taxes for the rich will actually help the economy as it’ll enable the super-rich to do business, run and create companies, employ people and it makes the UK attractive.

The super-rich instead are spending money on investments, whether it’s in diamonds, housing, cars or houses .. for themselves. They’re both generating and consuming themselves, instead of providing the “trickle down” effect to the workers and middle-class.

For those of us working, we’ve ended up poorer, but the Government has instead been able to show good economic figures as GDP is maintained by the super rich buying and spending.

Now in London massive developments are being sold before they’re even finished. The properties, bought by foreign buyers for the most part, are used as investments. They are capital. They’re gold bars sitting in plain sight.

70% of all new built residential property in London is now being bought by foreign investors. Prices are going through the roof as they become more and more popular. Meanwhile, the remaining properties and those outside of London are seeing a huge increase in the Buy To Let market, pushing home buyers further out than ever. It also means that first-time buyers are struggling. They’re seeing their wages stagnate, making it harder to build up a deposit to buy a house.

Do give “The Super Rich and Us here” a watch if you’ve got time, it’s a very interesting programme and a scary look at just how bad things are getting.