Friday, 3 October 2014

where did I put that 6p?

When you hear the media state figures or stats it's always worth remembering what is put to you is for impact.


"Prices only up 3%"

This three per cent makes more difference the less money a person has.

Say an item costs 2 quid and it goes up 3% that's 6p.
But if you compare impact to someone with a tenner against impact of someone with a hundred quid. The relative impact gets visible. Then compare that to impact on someone with a grand.
There's even less impact.

This basic thing may sound easy,

Relative impact is very important.

That's how you arrive at other measures that are important , like...

How much of your income goes on food...

Example someone with a grand spend 20 quid. And then someone with a hundred quid spend 20 .

See that?

Why am I explaining so simply?

Because then I can start talking in terms of this basic seemingly simple impact understanding...

And then say that is where the more difficult analysis of regressiveness.

"We will introduce a fair uniform tax of 30%" could be said by a party.
Now how is that fair..

It isn't.
Flat income tax rate is regressive in impact.

Other regressives are VAT. There are more.

So see?

Now where did I put that 6p?

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