Cancel Employer Pension?

BernardM

Our economy is our health, education, transport service which needs billions why wasn't it given to these that are in crisis.

You talk about being better off, and spongers. My arguments for less hours and say a four-day week to help the unemployed. Taxing those earning below £75,000 less than they are now would make at least 80% of the British population better off.

jamesd

BernardM wrote: »

Why should 50 billion pounds be given to the financial institutions and bankers who have created the economic and social and political crisis and nothing to the millions of British people who have lost millions of pounds.

Again our pensioners should be given a State pension equal to the national average wage. It could easily be met by this amount.

There are about ten million pensioners. Split that fifty billion Pounds between them and you have five thousand Pounds each. A reasonable annuity rate is perhaps 6% of the capital so that fifty billion might pay for three hundred Pounds a year, 5.76 a week.

Say you wanted to have that five thousand for each pensioner every year. The total income tax paid by everyone in 2006-7 was 150 billion, so you'd be suggesting that the income tax take should increase by a third. Say you tried to fund that from basic rate tax payers only, they paid 63.8 billion in tax so you'd be suggesting (50+63.8)/63.8 * 20 = 36% as the basic rate of tax. It's not quite that much because higher rate tax payers exist, 3.7 million of those to go with the 23.7 million basic rate. That extra 3.7 million people drops the needed increase from 16% to 14%.

So, do you really want to propose a basic rate of tax of 34% to pay for that 5,000 a year? If not, how else do you plan to pay for it?

Say you wanted only higher rate tax payers to pay for it. Their total income tax bill in 2006-7 was 84.3 billion so you'd be proposing an increase in that by 60%. 12 billion was at basic rate so that would leave 72.3 billion from higher rate tax. Add 50 billion to that and you need to increase the higher rate from 40% to 40 * (72.3 + 50) / 72.3 = 68%. Those earning over 100k paid about 50 billion of tax between them in 2006-7 and it's a safe bet that many of them would simply leave the country if you tried a 68% higher rate of tax.

The tax rate calculations above are really wrong in many ways but they will do for this discussion, to illustrate the implications of the proposed spending.

Pensioners aren't really that badly off in general. The mean income of pensioners who paid tax in 2006-7 was 19004 before tax and 16433 after tax, a tax rate average of 13.5%.

To try another way of looking at things, according to HMRC taxpayers of pension age paid 104 billion in tax in 2006-7, while 42.3% of tax payers of all ages had incomes below 20,000 and 57.7% below 30,000. So even if you went for a 20k target you'd still be making pensioners better off before than 42.3% of those working, more when tax is added in, because pensioners pay less tax.

BernardM

So you sound more concerned about someone earning £250,000 being taxed at 70% in the future, than poor pensioners and the unemployed struggling on £100 a week who currently have to pay exactly the same tax on food and services. Why not more concerned for them.?

The highest tax level is 50%, those responsible for Britain's current financial crisis should pay for that crisis. I think it would be fair that we should abolish VAT and increase Corporation Tax and make the rich pay.

I think a more sensible income tax band would be as follows.


Income under £15,000 per year --No tax payable


Income between £15,000 and £25,000 -- 20% tax payable


Income between £25,000 and £40,000 -- 30% tax payable


Income between £40,000 and £50,000 -- 40%! tax payable


Income between £50,000 and £100,000 ---50% tax payable


Income between £100,000 and £200,000 -- 60% tax payable

Income over £200,000 ---70% tax payable

dunstonh

So you sound more concerned about someone earning £250,000 being taxed at 70% in the future, than poor pensioners and the unemployed struggling on £100 a week who currently have to pay exactly the same tax on food and services. Why not more concerned for them.?

For most people, its a choice of whether you earn £100 pw in retirement or not.

The highest tax level is 50%, those responsible for Britain's current financial crisis should pay for that crisis.

What has the level of the highest tax rate got to do with the responsibility of those who started this recession?

Income under £15,000 per year --No tax payable


Income between £15,000 and £25,000 -- 20% tax payable


Income between £25,000 and £40,000 -- 30% tax payable


Income between £40,000 and £50,000 -- 40%! tax payable


Income between £50,000 and £100,000 ---50% tax payable


Income between £100,000 and £200,000 -- 60% tax payable

Income over £200,000 ---70% tax payable

You have just increased the tax liability for middle England and sent most of the bringers of wealth overseas. How are you going to raise funds to replace the lost tax revenue?

BernardM

This new Labour government has so far pledged £1,200 billion in public assistance to Britain's banks and money markets.
It's the biggest bail-out of British capitalism in history. The cost will be borne by at least two generations of workers through taxation, as public services and pension entitlements are cut to the bone.
Indeed, the sum is equivalent to 10 years public spending on the NHS or 15 years expenditure on education.
It contrasts with the measly £6 billion or so promised - but not yet delivered - by Chancellor Alistair Darling to productive industry last November, to assist small businesses and boost house-building, home insulation, road and school improvements and apprenticeships.
Let us not forget, either, that the £1,200 billion for the City comes from a government which said it could not afford £22 billion - its inflated figure - to renationalise our state-subsidised railways, £200 million a year to retain the Royal Mail wholly in public ownership, £50 million a year to keep 29 Remploy factories open for 2,500 disabled workers or £58 million a year to maintain 2,500 post offices now shut or scheduled for closure.
In truth, it's capitalism that we can't afford.

BernardM

A nurse or a doctor pays tax at 30 per cent, while the very wealthy who got rich on the back of the current financial chaos are effectively paying 11.25 per cent.
The highest level of taxation in this country is still lower than that in the US and our levels of tax on corporate profits is among the lowest in advanced capitalist countries.
Britain's greedy rich are leaving taxpayers to plug a £4 billion hole in the public purse by squirreling cash away in offshore tax havens.
The total cost of tax avoidance to British taxpayers stands at £25bn, with profit-hungry businesses accounting for the lion's share
The super-rich tax dodgers, who use loopholes in EU law to pay around 11 per cent tax on their income rather than the 40 per cent levied in Britain.
Under the EU Savings Tax Directive, British residents who hold offshore bank accounts in tax havens can either declare their interest to HM Revenue and Customs or opt to have a 15 per cent tax withheld from their interest payments by the country in which they hold the account.
This gives an effective British tax rate on offshore accounts of just 11.25 per cent.
It is unacceptable that new Labour has allowed tax havens for the super-rich to flourish in different parts of the world, including places under British legal jurisdiction such as the Isle of Man and Jersey.

BernardM

dunstonh wrote: »

For most people, its a choice of whether you earn £100 pw in retirement or not.



What has the level of the highest tax rate got to do with the responsibility of those who started this recession?



You have just increased the tax liability for middle England and sent most of the bringers of wealth overseas. How are you going to raise funds to replace the lost tax revenue?

The bringers of wealth. Do you mean 'the City. This section of society does not manufacture anything, it does not build or create anything, yet it is now the most dominant sector in the U.K. Its chief objective is the movement of money in search of the biggest profit margin in the quickest possible time.

A flat rate income tax systems only purpose is to move even more of the burden
on to low-paid workers and benefit companies and shareholders.
We need these income tax rates to ensure that those that earn the most pay the most.

jamesd

BernardM wrote: »

So you sound more concerned about someone earning £250,000 being taxed at 70% in the future, than poor pensioners and the unemployed struggling on £100 a week who currently have to pay exactly the same tax on food and services. Why not more concerned for them.?

I expressed no concern either way, I simply told you how much your proposal would add to various tax rates if you tried it, after showing you how wrong your claim that only 50 billion could fund it was.

BernardM wrote: »

The highest tax level is 50%, those responsible for Britain's current financial crisis should pay for that crisis.

How do you plan to impose a tax on US citizens in the US? Those most directly responsible are US home buyers who stopped paying their mortgage when the value of the property dropped below the value of their mortgage. If you want ot go a bit further back, it's the people in the US who produced the rule that a home buyer could walk away from the property like that and not owe the mortgage lender any money (in the UK you still ow the difference between mortgage and sale price). That made property a one way bet in the US: if it goes up you profit, if it went down to below mortgage value you just walk away and pass the burden to the US, UK and other international banks who bought the mortgage. The UK banks, like pensioners relying on savings account interest, are simply victims of that US system.

BernardM wrote: »

I think it would be fair that we should abolish VAT and increase Corporation Tax and make the rich pay.

OK, lets start with that. Page 231 of the 2009 Budget gives the income sources for the UK government. Revenue from all sources except the North Sea was 548 billion in 2007-8. Income tax was 151.8 before 4.4 billion of tax credits. You just proposed eliminating the 80.6 billion of VAT revenue and replacing that with an increase in the 46.3 billion of corporation tax and an increase in taxes that mostly affects average earners.

So, how much would you increase corporation tax by and how would you stop companies who are already relocating because of the changes from doing so even more after you increase it further? For example, see Call to cut corporation tax rates which points out that UK rates in 2008 were sixth highest out of the fifteen OECD countries and that UK has slipped in company competitiveness index from fourth to fifteenth in the preceding five years. After allowing for companies that leave the UK, what would the new rate you'd use be?

BernardM wrote: »

I think a more sensible income tax band would be as follows.

Income under £15,000 per year --No tax payable
Income between £15,000 and £25,000 -- 20% tax payable
Income between £25,000 and £40,000 -- 30% tax payable
Income between £40,000 and £50,000 -- 40%! tax payable
Income between £50,000 and £100,000 ---50% tax payable
Income between £100,000 and £200,000 -- 60% tax payable
Income over £200,000 ---70% tax payable

OK. Income tax revenue in 2007-8 was 151.8 billion. What will it be with this plan? I pointed you to the HMRC tables saying how many tax payers are in various bands so you have the information needed to work it out.

Shorter version is: you're continuing to make bogus claims that sound good but don't have basis in real numbers. That undermines your cause. Use numbers that work and it'll be a lot more likely that you will be taken seriously. Then we might have a sensible discussion about whether those prices are worth paying for the benefits they deliver.

BernardM wrote:

The total cost of tax avoidance to British taxpayers stands at £25bn, with profit-hungry businesses accounting for the lion's share

Are you sure it's that low? What about the cost of the ISA allowances and pension tax relief that are both tax avoidance measures, some of the most popular in the country? I've done a lot of research here so perhaps you'd care to do the research to get those numbers? You'll find that HMRC publishes them.

bendix

I think someone needs to point out to Bernard that no money has been given to any banks. It has been loaned.

Dear old Bernard needs to widen his reading from the Daily Mail, to something with a bit more substance.

dunstonh

The bringers of wealth. Do you mean 'the City.

Why is it that you assume that all high earners work for banks?

You appear to have a bee in your bonnet about anyone who has earned money and want to penalise them for doing so.