Should we be pushing for greater fairness in C2W?

Syd
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Should we be pushing for greater fairness in C2W?

Postby Syd » 6 Oct 2019, 1:38pm

To me there is currently a fundamental element to the C2W scheme which which unfair to the lower paid who will be more likely to have less disposable income.

As it stands at present the scheme benefits the buyer by reducing their tax burden during the 12 months they make payments. Those higher rate tax payers therefore benefit more.

My wife and I have both just finished paying for our respective C2W bikes, both of which retailed at £1,000. After calculating how much the bike cost each of us it was evident that I, as a higher rate tax payer, saved significantly more % wise than my wife.

My bike cost me less than a junior colleague of my wife’s bike which retailed at a good bit lower cost than mine.

To me this is fundamentally unfair. Should the scheme be changed to allow savings capped lower tax rate to be fair to everyone?

landsurfer
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Re: Should we be pushing for greater fairness in C2W?

Postby landsurfer » 6 Oct 2019, 1:45pm

To me this is a rare offset to the 40% tax i pay on the majority of my salary and my pension ...

As a single income family of 5 ( 2 adults, 3 children ) i have no qualms at all about taking this break.
Maybe you and your wifes combined income allows you a certain degree of altruism ... we don't have that luxury.
My last 3 bikes have come from the C2W scheme ....
It's just like that, it's just the way it is.
The road goes on forever.

Bonefishblues
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Re: Should we be pushing for greater fairness in C2W?

Postby Bonefishblues » 6 Oct 2019, 2:00pm

Perhaps our energy should be focused on the low-waged who can't take advantage at all, if it pushes them below the statutory minimum?

Syd
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Re: Should we be pushing for greater fairness in C2W?

Postby Syd » 6 Oct 2019, 2:10pm

Bonefishblues wrote:Perhaps our energy should be focused on the low-waged who can't take advantage at all, if it pushes them below the statutory minimum?

Whilst true I’m not sure that’s as easy to resolve. There is also the 2.4% of the population on zero hours contracts for home the scheme is effectively impossible.

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NUKe
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Re: Should we be pushing for greater fairness in C2W?

Postby NUKe » 6 Oct 2019, 2:54pm

You do realise that most of this benefit has gone to cycle manufacturers/ retailers who have pushed up prices as a result of cycle to work.
NUKe
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Bonefishblues
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Re: Should we be pushing for greater fairness in C2W?

Postby Bonefishblues » 6 Oct 2019, 3:05pm

NUKe wrote:You do realise that most of this benefit has gone to cycle manufacturers/ retailers who have pushed up prices as a result of cycle to work.

Rather like the ULEV subsidy :)

Syd
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Re: Should we be pushing for greater fairness in C2W?

Postby Syd » 6 Oct 2019, 3:25pm

NUKe wrote:You do realise that most of this benefit has gone to cycle manufacturers/ retailers who have pushed up prices as a result of cycle to work.

Assuming that is true and there is evidence to support it it still doesn’t make the imbalance in the scheme and more fair.

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 6 Oct 2019, 11:13pm

Why not make it work based on lower tax rate? It's something that bothered me. If you're earning enough to be taxed at the higher rate you're on a good salary and probably able to save up to £1000 (unless you're living to your means to keep up with the Jones of course). So the government gives you a bigger discount on the bike than a lower tax rate person less able to save for a grand of bike.

So level the playing field. Why not give everyone the same discount?

Btw "last three bikes that way" comment from higher tax rate earner tickled me a bit. Made me wonder over how long a period? If over the 20 years it's been running fair enough but if you're buying a new bike every year using the scheme imho it's taking a kind of advantage sorry for being a bit judgemental but imho the whole scheme is flawed right through.

Flawed in a few ways. Wasn't it set up to encourage healthier ways? The idea half your journeys with the bike were commuting to work. I wonder how true that is? Then there's the richer get bigger discounts on tie bikes bought that way. For me the fact you're paying more tax doesn't justify this. You're only getting the higher rate of tbe benefit because this was the easiest way to give the benefit. I'm sure there's a better way but it would probably need legislation above what the government of the day was willing to put through.

Personally I think it should be scrapped completely or the flaws get sorted.

Bonefishblues
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Re: Should we be pushing for greater fairness in C2W?

Postby Bonefishblues » 6 Oct 2019, 11:39pm

Syd wrote:
Bonefishblues wrote:Perhaps our energy should be focused on the low-waged who can't take advantage at all, if it pushes them below the statutory minimum?

Whilst true I’m not sure that’s as easy to resolve. There is also the 2.4% of the population on zero hours contracts for home the scheme is effectively impossible.

We should focus on the easy stuff, I suppose.

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NUKe
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Re: Should we be pushing for greater fairness in C2W?

Postby NUKe » 6 Oct 2019, 11:54pm

Syd wrote:
NUKe wrote:You do realise that most of this benefit has gone to cycle manufacturers/ retailers who have pushed up prices as a result of cycle to work.

Assuming that is true and there is evidence to support it it still doesn’t make the imbalance in the scheme and more fair.

True,
NUKe

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landsurfer
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Re: Should we be pushing for greater fairness in C2W?

Postby landsurfer » 7 Oct 2019, 8:42am

Tangled Metal wrote:
Btw "last three bikes that way" comment from higher tax rate earner tickled me a bit. Made me wonder over how long a period?


11 years, a rigid MTB, bought as ideal for the child seat .. and 2 road bikes in that time.
Which are my only bikes.
Just 2K into the higher tax bracket. A couple can have a combined income of £100k and still be in the lower tax bracket, but our total income of £52K sees us in the high bracket .... Theres no such thing as "FAIR"...
:D
It's just like that, it's just the way it is.
The road goes on forever.

Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 7 Oct 2019, 9:18am

I understand about the unfairness of being just over a threshold but our household has two earners who have a combined probably below the threshold and we have to buy our bikes with less discount. Is that any fairer?

Guess how many we've bought in 11 years? The answer is 1 and I couldn't get C2W anyway at the time. Well, apart from kids bikes and my sh recumbent which I'll probably sell on for what I paid for it anyway. Plus after getting my bike I learnt it wasn't able to take a child seat because of a weird instability thing that would shake me off the bike.

Incidentally with restrictions on sale discounts with some schemes I can probably get a bike cheaper outside the scheme and with 3 years interest free credit. Seriously, I know one bike shop that'll give you 3 years completely no extra cost credit on bikes over a certain value well below the grand threshold most schemes work to. £1000 bike costs £1000 ÷ 36 months = £27.77 per month or so. Especially good if full rrp was £1399. Not what I've done bit enticing compared to C2W on basic tax rate.

brynpoeth
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Re: Should we be pushing for greater fairness in C2W?

Postby brynpoeth » 7 Oct 2019, 9:22am

It is just like the scrapping credit for cars, moves cash, creates work, uses resources
-1

Why would anyone want more than one cycle? :wink:
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Tangled Metal
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Re: Should we be pushing for greater fairness in C2W?

Postby Tangled Metal » 7 Oct 2019, 9:29am

How many of your journeys on those were work commutes? Does anyone actually buy bikes through C2W for over 50% commuting duties?

The scheme is unjust because it uses income and tax rates to give different discounts. It's flawed because it has no guaranteed way to encourage anything.

Having said that I do like some tax based encouragement to healthy exercise. I believe Sweden has a system where you get the costs for exercise back through tax rebate. AIUI you go to the gym and it comes out of your tax for example. Basically you can buy exercise services even equipment then the cost comes out of your tax. I used to know a Colombian guy working in Sweden who got gym membership. He told me some work colleagues got a nice bike out of it too.

PH
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Re: Should we be pushing for greater fairness in C2W?

Postby PH » 7 Oct 2019, 9:33am

It isn't fair, then the same could be said about much of the tax system. It might do a little good, I can't see that it does much harm. Those I know who are strapped for cash will buy a sub £100 second hand bike rather than sign up for this anyway. I've worked for an employer who wouldn't introduce it as they couldn't offer it to everyone on the payroll and the rules are an alternative must be offered to those not eligible. I doubt the cycle industry has been creaming it in, it's a competitive market and the scheme providers take a decent chunk out of it. The previous £1,000 limit might have focused some brands to aim at offering bikes at that price point, there's good and bad to that, some of those grand bikes might have been better bikes just over the limit and some that would have been a bit less have maybe been bumped up.
I've had the opportunity a couple of times but haven't used it, either I didn't need a new bike or I could get a better deal without it and dislike the idea of unnecessary debt.